Fertilizer Prices Drop 30% Following Demand Destruction

(Bloomberg) -- Fertilizer prices that had hit records are now plunging as buyers reel from sticker shock.

Most Read from Bloomberg

Ukraine Latest: US Slams Putin’s Food-for-Sanctions Relief Plan

Ford Beats Tesla to the Punch With First Electric F-150 Delivery

Top Gun: Maverick's F-18 Flights Cost New Tom Cruise Film $11,374 an Hour

Rare Ship-to-Ship Transfers Keep Oil Moving From Russia to China

The June spot price in Tampa, Florida for the nitrogen fertilizer ammonia settled at $1,000 per metric ton, a drop of 30% from May’s $1,425 per metric ton, according to Green Markets, a Bloomberg company.

Demand destruction is part of the decline. Places like Southeast Asia are seeing buyers unwilling to pay the record high prices that were posted in April and May, said Green Markets analyst Alexis Maxwell. It also reflects the declining cost of ammonia production as European natural gas prices fell in the second quarter, she said.

Even with the drop, however, prices are still 87% higher than a year ago, and supply chain issues continue to wreak havoc on global markets.

Read More: Can the World Feed Itself? A Fertilizer Crunch Is Wrecking Crops

(Adds background information in final paragraph.)

Most Read from Bloomberg Businessweek

The Tech Rout Isn’t Just Cyclical—It’s Well-Earned, and Overdue

A New Prediction Market Lets Investors Bet Big on Almost Anything

Mark Zuckerberg Is Blowing Up Instagram to Try and Catch TikTok

Elon Musk’s 420-Degree Edgelord Pivot Is Getting Stale

Deadly Heat in India Is a Warning of Global Catastrophes to Come

©2022 Bloomberg L.P.
Click Here To Get Funded!