Matt Cooley’s farm in Hampshire has a long fiberglass tank under lock and key. No wonder: the fertilizer inside has become an increasingly valuable commodity.
Prices of synthetic fertilizers needed to grow many crops and grasses began to rise last autumn when the price of the gas needed to produce them began to rise sharply. The conflict in Ukraine has exacerbated the situation.
If Culley had bought enough fertilizer to fill this 25,000-liter container at current prices, it would have cost 21,000. Just a year ago, the same amount of liquid urea-ammonium nitrate would pay him back £ 6,000 – a 350% increase.
“We’re not the most fertile land here,” said Cooley, who was upset by the spring rains as he surveyed the dug wheat field, which would turn into flour for use in biscuits.
Planted in late October, the green shoots of wheat have already grown to a height of about 15 cm (six inches) centimeters and, if all goes well, will be ready for harvest in mid-August.
“We are conventional farmers so to feed the crop in a place where we can justify doing the work, we rely on input, whether it be artificial or organic fertilizer.”
According to Anthony Hopkins, chief crop adviser at the National Farmers Union (NFU), British farmers use about 1 million tonnes of nitrogen produced each year, to grow crops for human consumption and grass for animal feed.
Yet farmers are facing unprecedented costs for this vital ingredient. The price of ammonium nitrate fertilizer has risen to £ 1,000 per tonne in recent weeks from 0 280 per tonne 12 months ago.
Cooley and his brother Daniel are the fourth generation to cultivate this 170-hectare (420-acre) land near the town of Andover – cultivating wheat, barley, oilseeds and soft fruits – while he also manages an additional 480 hectares for other local farmers and landowners.
Something needed for this year’s crop but all the fertilizer Cooley bought last autumn when prices began to rise, and so he decided to stop future purchases; He now regrets a decision. A multi-year contract for some of his crops means he is committed to delivering a certain amount of produce at harvest time.
As a result, he and the cultivators he represents as chairman of the NFU’s grain board are meeting the increased costs at a lower cost.
“This year we are reducing the application of all crops within our purchasing group by 25%. This saves an extra load order, ”Culley said. “We need to apply enough to increase the crop, but lower our expectations in terms of yield.”
Fertilizer is one of the three Fs that farmers have to buy – including food and fuel – all of which have seen rising prices in recent months, especially since Russia invaded Ukraine, increasing the pressure on agriculture.
Cooley has recorded a 60% increase in animal feed over the past two years, while energy and lubricants have increased by more than a third (38%), and fungicides and herbicides have increased by about 10%.
Rocket costs present the latest challenge for domestic food producers, following months of labor shortages, which were highlighted in a parliamentary report last week.
MPs from the Committee on Environment, Food and Rural Affairs have warned that prolonged labor shortages could affect domestic production, leading to higher food prices and higher food imports.
Ongoing and massive labor shortages have led to crop rot in the fields, lack of labor at meat processing plants has led to the slaughter of healthy pigs on farms, and disrupted the food supply chain as a threat to UK food security.
The UK produces enough food to meet about 60% of its demand, but many in agriculture fear a persistent shortage of workers after Kovid and Brexit – when seasonal workers are limited to 30,000 a year for grain and flower pickers in the UK. By the government – with rising costs, farmers are under so much pressure that some may choose to leave the industry.
NFU President Minette Batters called on the government to help farmers reduce some unprecedented costs and tighten fertilizer supplies.
He welcomed the Fertilizer Crisis Meeting organized by the Department of Environment, Food and Rural Affairs (DEFRA) with agro-industry organizations including NFU at the end of March.
Ministers have delayed the introduction of a ban on the use of urea, a key fertilizer used in the UK to reduce air pollution – and are changing some of the rules surrounding autumn mole spread.
“We continue to work with the government on the importance of fertilizer and ways to ensure stability and confidence in the food supply chain,” Batters said.
However, some other measures of the government may not have a long-term and immediate effect. Defra proposed to pay farmers to reduce the cost of nitrogen-fixing plants, such as legum and clover, for which no fertilizer is required. But it doesn’t help much when the coolie’s winter wheat-like crop is already in the ground.
Commodity analysts warn that farmers will not see a drop in fertilizer prices soon.
Consultancy CRU Group, which tracks product prices, has seen its fertilizer price index – which includes data on nitrogen, potash and phosphate – hit a record high on March 31 after the start of the war in Ukraine.
“Right now we expect prices to continue to rise in the next few months,” said Chris Lawson, CRU’s head of fertilizer. “There is incredible volatility in the market right now.”
Several factors, including high gas prices and declining supply, will drive up prices for a long time to come. Last month, the CRU estimated that energy consumption was affecting about one-third (28%) of European fertilizer capacity because plant production had been reduced or temporarily suspended.
The United Kingdom produces about 40% of its own fertilizer, but there are concerns about supply from Russia – the world’s largest exporter of synthetic fertilizer, which supplies more than one-fifth of urea – which has limited some exports.
Returning to the farm in Hampshire, Cooley will continue to monitor his field in the coming weeks, working out how often to apply a small amount of fertilizer, so that his crop grows as needed.
“The risk is much higher at this price,” he said. “The question will be next autumn, will we plant this crop?”
A Lancashire farmer has spoken for many in his industry when he recently won £ 30,000 in the People’s Postcode Lottery. Instead of splashing on a new car or holiday, he announced that he would spend all his windfall for fertilizer.