Fertilizer imports from Russia drop 9%, Brazil diversifies suppliers

RIO DE JANEIRO, BRAZIL – Despite the world’s difficulties with the purchase of fertilizers this year, Brazil imported a record volume of this input in April. However, the bill, due to the high international prices, was high.

A total of 3.25 million tons were purchased in April, 71% more than in the same month last year. Brazil has imported 11.2 million tons from January to April and 42.2 million tons in the last 12 months.

Purchases from Russia, the primary source of fertilizers for Brazil, dropped 9% in the first four months of this year, compared to January and April 2021. Last month, the Russians supplied 660,000 tons of fertilizer to the Brazilians, a volume 4% lower than in March.

Russia, which has maintained the leadership in exports to Brazil since 2009, was responsible for 22% of the fertilizer imported by Brazil in the first four months of the year, supplying 2.45 million tons of the input.

Canada, China, Nigeria, and Israel increased the supply of the product to Brazil. China and Canada exported 1.7 million and 1.1 million tons, respectively, to Brazil from January to April. Even Venezuela increased its exports, supplying 65,000 tons in the first four months of the year.

High oil prices, expensive energy, production reduction in some mines, and difficulties in international trade have put a lot of pressure on fertilizer prices since last year.

Although they only went up 6% in volume, Brazilian imports from January to April obliged the country to spend 147% more on the purchase of these inputs.

In the first four months of last year, spending totaled US$2.62 billion. In these four months, they reached US$6.48 billion.

The country’s agricultural expansion has accentuated Brazil’s foreign dependence on fertilizers. Ten years ago, Brazilian farmers planted 50.9 million hectares of grain crops. This year, the area jumped to 73.4 million.

This increase in the area allowed the country to go from an annual crop of 166 million tons of grains in 2011/12 to the current 270 million, according to data from Conab (National Supply Company).

The initial estimate for the Brazilian crop was 290 million tons in the period 2021/22, a volume frustrated by recurring climatic problems in recent years. Last year, drought and frost broke the corn harvest. This year, it was the soybean crop.

A large part of the imported fertilizer is destined for the soybean and corn crops. In the last five years, the areas of these products increased by 22%. The oilseeds area reached 41 million hectares, and that of grain rose to 21.5 million.

Although smaller, the cotton area increased by 78%, adding 4.1 million hectares, according to the most recent data from Conab.

The Ukraine War made Russia reduce its purchases of some products in Brazil in April. Among them are coffee, meat, soybeans, and sugar.

The Russians, however, prepared themselves in the months before the conflict. The volume of soybean purchases increased by 136% in the four-month period, and sugar by 785%.

The Brazilian agricultural expansion also made the country dependent on agrochemicals. In the first four months of this year, foreign purchases of pesticides (classified by the Ministry of Agriculture as herbicides, fungicides, insecticides, acaricides, and others) totaled 146,700 tons, 64% more than in the same period last year, according to data from Secex (Secretariat of Foreign Trade).

The most considerable evolution in the period came from herbicides, whose imports reached 87,000 tons, well above the 31,000 of the same period last year.

The foreign purchases of insecticides fell 20% in volume, and those of fungicides increased 24%. The expenses with agrochemicals rose to US$1.3 billion this year, 92% above January to April of last year.

With information from Folha de S.Paulo