South America Calling

Brazilian Fertilizer Sales Stable in July

Brazilian fertilizer sale figures for July confirmed business was picking up after a very slow start to the year.

Last month's sales totaled 3.3 million metric tons, down just 0.1% on the same month last year. Deliveries in the first seven months of 2015 remain well down though, some 10.5% back at 15.0 mmt.

A slump in grain prices, combined with limited access to farm credit, was expected to cause a major decline in fertilizer sales in 2015. However, the slide of the Brazilian real has improved the prospects for soybean margins in 2015-16 and more farmers will plant than were expected back in April. As a result, demand for fertilizers has surged over the last two months ahead of the start of summer crop planting in September.

Sales will still likely fall overall though as great price volatility, rising dollar-linked prices and limited access to credit will keep a lid on demand. Meanwhile, logistical bottlenecks will limit the capability of firms to meet last-minute orders, especially in the frontier regions of the center-west and northeast.

Looking just at NPK nutrients, deliveries between January and July were down 10.5% at 6.3 mmt.

Out of the NPK fertilizer group, phosphate sales have registered the biggest fall in 2015, slipping 12.6% to 2.1 mmt.

Local fertilizer production actually rose 5.1% in the period to 5.15 mmt.

(ES)

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