RIO DE JANEIRO, BRAZIL – After an exponential increase in fertilizer prices with the start of the conflict between Russia and Ukraine, another extreme measure is worrying Brazilian agriculture. Russia announced that it had suspended fertilizer exports to Brazil. The country is importing about 85% of its fertilizer.
Ambassador Sergei Lukashevich made the announcement. He explained that the country was forced to suspend trade because Lithuania (EU country) had closed its borders and prevented access to the logistics corridor.
“Is this democracy?” he asked. Russia accounts for 20% of all fertilizers consumed by Brazil.
Add to this the deliveries from Belarus and we are talking about one third of the Brazilian demand for fertilizer.
Without them, supply will decline, and prices will skyrocket. Last year, they were 155% more expensive. As a solution, the Brazilian government hopes it can increase purchases from countries such as Canada and Iran.
“The Lithuanian side has banned transit under far-fetched political pretexts, stating that the transit of Belarusian potash fertilizer to Brazil threatens Lithuania’s national security, among other things,” the note continues.
It is feared that the interruption of exports by Russia and Belarus will drive up the price of the product and jeopardize this year’s Brazilian harvest. The state parliamentary group is also concerned about the course of the war in Eastern Europe.
Given the strong global demand for food, the signs are pointing to a storm and are a direct result of the West’s out-of-control punitive measures against Russia.
According to federal deputy Neri Geller (PP-MT), the conflict could lead to a sharp increase in the price of agricultural inputs. And this will have a direct impact on consumers’ wallets and could even call into question the availability of sufficient food in general.
According to the deputy, the price of a ton of potassium has risen from US$320 to US$850 in the last twelve months. “We don’t know what the situation will be if the sanctions affect fertilizers. If there are sanctions in that sense, we will have an impact.
Maybe there will be a shortage of products for the next crop, or the cost will increase because it will have to be sourced from other countries like Saudi Arabia, Iran, and Bolivia. But it’s not enough for the amount we produce,” he added in an interview with Correio Braziliense.
One of the states most affected is Mato Grosso, the country’s largest grain producer. According to Conab, Russia will be involved in 21% of nitrogenous products in 2021, and in the specific case of ammonium nitrate, the country is practically the only supplier to Brazil.
In January, 2.31 million tons of fertilizers were consumed – 15.2% less than in January of the previous year, but with unprecedented expenditures – US$1.1 billion, as average prices for imported products reached a record US$496.62/ton. – This is an increase of 110.4% compared to prices in the same period last year.
Brazil’s massive agricultural industry feeds about 1 billion people. Should the globally crucial food production of the country be endangered due to the ill-considered sanctions and isolationist actions of the West towards Moscow, the US and EU should be held responsible by the world.