Ostchem Holding, which includes the companies of the nitrogen chemistry group DF e.gusammen, has increased prices for mineral fertilizers by 10-15%. The Interfax-Ukraine agency reported this regarding the information provided by the press services of the DF group.
Prices have been revised due to the sharp rise in gas prices and exchange rate volatility. We keep the price until the end because we understand that farmers are having a hard time now. However, the changing market situation does not leave us much leeway.
Oleg Arrestarchov
Director of the Corporate Communications Department of the DF International Group
He explained that the price of natural gas is more than 70-80% of the cost of mineral fertilizers.
The selling price of ammonium nitrate with delivery to a household within 200 km increased by 8,7% to €945/Tonne, carbamide rose by 6,8% to 1080 €/ton, lime-ammonium nitrate by 11,8% to 756 €/ton, and the carbamido-ammonium mixture showed the greatest growth by 15,2% to 878 €/ton.
Oleg Arrestarkhov emphasized that after all previously concluded agreements with farmers and agrarian holdings to purchase fertilizers at a lower price, Ostchem “will 100% fulfill its obligations to deliver fertilizers”, which proves the effectiveness of buying fertilizers in the off-season.
The growth of solvent fertilizer demand and prices is now directly influenced by two factors - the release of grain exports by sea and prices on the Chicago Stock Exchange. So far, the trend has been disappointing: grain prices are falling, while the big fertilizer producers in the EU successively falter on rising gas prices.
Oleg Arrestarchov
Director of the Corporate Communications Department of the DF International Group
According to him, what is happening in the fertilizer market is part of a chain reaction that started last fall, while the war was only a catalyst for this reaction.
Therefore, there is every reason to expect a further increase in fertilizer prices and reduce their availability both in global markets and domestically. In Ukraine, fertilizer consumption has decreased by at least 30-40%, and it is a task for the government and the cabinet to support farmers through various tools as effectively as possible so that in 2023 there is no significant decrease in crops.
Oleg Arrestarchov
Director of the Corporate Communications Department of the DF International Group
In his opinion, manufacturers will reduce margins, but they will not be able to sell fertilizers below cost.