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Fertilizer Situation & Issues

Fertilizer Situation & Issues. Glen Buckley 2009 Legislative Ag Conference January, 2009. World Nitrogen Price Index (Average 2003 = 100 ). Market spikes to record levels. Market collapses . Long-Term Trend. January 2003 Current. Source: Green Markets.

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Fertilizer Situation & Issues

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  1. Fertilizer Situation & Issues Glen Buckley 2009 Legislative Ag Conference January, 2009

  2. World Nitrogen Price Index (Average 2003 = 100) Market spikes to record levels Market collapses Long-Term Trend January 2003 Current Source: Green Markets

  3. World Nitrogen Demand(MM Metric Tons) 2002-07 3.7% Growth 1990-2002 1.1% Growth Calendar Years Source: Fertecon, CRU, CF

  4. World Nitrogen Operating Rate MM Tonnes N World operating rates climb to record levels Average Rate 1992-2002 = 80.9% Calendar Years Source: Fertecon, CF

  5. World Natural Gas Prices($/MMBtu) Calendar Years Source: CERA, Fertecon

  6. U.S. Ammonia and Urea Capacity (Million Tons of Product) 2000 2008 Change Ammonia 19.9 11.5 -40% Urea 9.8 6.3 -36% Calendar Year Source: Fertecon, CF

  7. Perfect Storm - Up Demand • Crop futures escalate to record levels • World nitrogen import demand soars – concern over supply availability Supply • China drop out of the market • Record level of unexpected plant outages/turnarounds – Russia, Ukraine, Trinidad, Argentina, Middle East • Freight rates jump to record levels • Dollar continues to decline

  8. World Urea Prices($/Tonne) “China export tax” Source: Fertecon

  9. Perfect Storm - Down • Crop futures plummet • Credit/Financial crisis hits world market • World fertilizer trade demand comes to a complete halt • Freight rates collapse • Inventory in exporting countries soar – force plant closures • Dollar climbs 20%

  10. World Urea Production Outages(MM Tonnes) 2.59 MM Average = 936,000 Source: Industry Publications

  11. U.S. Nitrogen Supply(MM Tons N) “Imports now account for more than half of total U.S. nitrogen supply” Imports Domestic Production Fertilizer Year Source: USDC, TFI

  12. U.S. Dry Urea Supply (Million Product Tons) Imports Domestic Production Fertilizer Year Source: USDOC, IFDC, TFI

  13. U.S. Dry Urea Imports (MM Product Tons) Fertilizer Year Source: USDC, TFI

  14. U.S. UAN Supply(Million Product Tons) Capacity Imports Domestic Production Fertilizer Year Source: USDOC, IFDC, TFI

  15. U.S. UAN 32% Imports (MM Product Tons) Fertilizer Year Source: USDC, TFI

  16. World Phosphate Price Index (Average 2003 = 100) Market spikes to record levels Market collapses S/D Balance Tightens January 2003 Current Source: Green Markets

  17. World DAP/MAP Demand(MM Metric Tons) 2001-07 4.9% Growth 1990-2001 1.6% Growth Calendar Years Source: Fertecon, CRU, CF

  18. DAP Input Cost Into India ($/Tonne) Source: Fertecon, GM

  19. India DAP Production Cost ($/Tonne) Source: Fertecon, FMB

  20. U.S. DAP/MAP Production(000 Tons P2O5) Source: TFI, DOC, CF

  21. Questions?

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