Monday 14 March 2022

Fertiliser Crisis Could Lead To Food Shortages And More Price Rises

Farmers in the UK are facing the prospect of fertiliser rationing because of the war in Ukraine, which could lead to shortages of some foods in supermarkets and further inflationary pressure.

Russia is the world’s biggest exporter of fertiliser that is essential for growing crops and grass for cattle. Last week the EU imposed sanctions on three large producers, Eurochem, PhosAgro and Uralchem.

According to The Times newspaper, some fertiliser merchants have temporarily closed their order books because of a lack of supply while others are rationing the amount that farmers can buy. The UK imports around 60% of its fertiliser.

NamNews Implications:
  • Understatement of 2022?
  • The cost of fertiliser has also quadrupled in the past year from about £250 a tonne to nearer to £1,000 due to rising gas prices.
  • (and that before the Ukraine crisis…)
  • Moreover, the squeeze on fertiliser supplies is expected to limit the scope for substitution of lost Ukraine wheat production by other countries.
  • Time to try some what-ifs based on 10% and 15% inflation…
#HyperInflation #ShortSupply

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