Brazil Reveals USD 1.6 billion Spend on Fertilizer from Arab Countries
Arab countries exported 64.5 per cent more fertilizer from Q1 to Q3 2013 over previous year
The Brazilian market has reportedly spent over USD 1.6 billion on fertilizers coming from Arab countries during the first three quarters of 2013, reflecting a 41.07 per cent increase from the same period in 2012 or USD 1.1 million in growth. Products imported came from top Arab countries, including Qatar, Morocco, Kuwait, UAE, Egypt and Tunisia.
According to recent industry reports, Morocco was named as the top supplier of fertilizers to Brazil during the first nine months of 2013 with a spending of USD 933 million and a growth of 19.05 per cent from the previous year.
This is followed by Qatar, with USD 325 million and a growth of 268 per cent. Egypt and Tunisia take third and the fourth place with USD 133 million and 96.49 million, respectively. Of the four countries mentioned, Qatar supplies nitrogenized products while Egypt provides quality urea at reasonable prices.
Both Tunisia and Morocco are known in the industry as key suppliers and traditional producers of phosphates. In addition to the four countries, Bahrain and the UAE supplied fertilizer worth around USD 35 million each to tie a fifth place, while Kuwait is listed in sixth with USD 32 million.
In addition to this, fertilizer producing countries are now turning to the Brazilian market due to India’s recent move to reduce its fertilizer imports.
The country was once the leading importer of fertilizers, however, the depreciation of the rupee has prompted the Indian government to remove subsidies to phosphate imports, thereby driving in a reduction in local purchases. This move, in turn, has resulted in an impact on the global market, driving fertilizer prices down. Also causing a drop in phosphate prices is the partnership split between Russian firm Uralkali and Belarusio Na Potash Company, which used to dominate a large share of the global market.
Fertilizer shipments from Arab countries to Brazil have displayed a reduction in product value. In fact, the volume of imports made from Q1 to Q3 of last year has grown to 64.55 per cent as compared to 2012. Brazil bought a volume figure of around 3.9 million tonnes from Arab countries.
However, the country’s greater fertilizer imports are not restricted to Arab suppliers alone. The Brazilian National Fertilizer Association (Anda) has reported that during the first nine months of 2013, Brazil bought abroad a 23.83 per cent greater volume of fertilizers, or a total of 20.4 million tonnes. The growth is attributed to the growing demand for food, coming mainly from emerging nations, which has prompted Brazil to produce more agricultural commodities and thus needing more fertilizers.
In conclusion, the country’s limited capacity for fertilizer production has led to the use of imports during agricultural production. Brazil produces 25 per cent of the fertilizer it uses and imports the remaining 75 per cent. In case of potassium chloride, imported products represent around 90 per cent of the total while the urea supply is 65 per cent foreign and 50 per cent of phosphates come from abroad.
