The war in Ukraine has caused considerable insecurity concerning the continuity of potassium fertilizers supplied to Brazil. As mentioned in previous blogs, Brazil is currently the fourth largest consumer of fertilizers in the world, importing approximately 85% of all the fertilizer used in the nation’s ag production.
In the case of potassium, the imported percentage is even higher, around 95% (approximately 12 million tons). In 2021, Brazilian fertilizer imports were more than 41 million tons, equivalent to more than $14 billion U.S.
At a recent meeting in Jordan, the Brazilian Secretary of Agriculture visited the country's largest fertilizer producer and signed an agreement with the Jordanians to supply Brazil with up to 1.2 million tons of potassium over the next five years. The idea is to reduce dependence on Russia, since Jordan is the 7th largest potassium producer in the world.
The Arab Potash Company, Jordan's potassium manufacturer, produces more than 2.4 million tons of potassium per year and is the only potassium producer in the Arabic countries. This company is already a potassium supplier to Brazil, and started exporting to the Brazilian market in 2019 at a volume of 42,000 tons, increasing to 154,000 tons in 2020 and 138,000 tons in 2021. In this first quarter of 2022, 91 thousand tons have already been shipped, with the perspective of reaching 320 thousand tons by the end of 2022.
Increased fertilizer capacity
During the visit, Arab Potash Company execs announced plans to open an office in Brazil to facilitate negotiations with Brazilian importers. The company's CEO revealed that the company intends to establish a production operation in Brazil. The company plans to increase exports to Brazil and subsequently invest in the country by building a fertilizer factory. However, these plans are only for the next two years.
The opinions of the author are not necessarily those of Farm Futures or Farm Progress.