Fertilizers pile up in Brazilian ports, testifying to how well the country has positioned itself

RIO DE JANEIRO, BRAZIL – Since the war in Ukraine and the sanctions against Russia, fertilizer has been in short supply worldwide.

While most countries are throwing their hands up in horror and don’t know where to get them, Brazil is in a somewhat different situation.

A glut of fertilizer at Brazil’s largest ports indicates that the country has positioned itself well in geopolitical terms and that it is not in conflict with any side.

That is why Bloomberg writes, that the price of the nutrients may have to drop further before farmers start thinking about buying them.

According to Luiz Teixeira da Silva, its operations director, at Paranaguá, private warehouses reached their maximum storage capacity of 3.5 million tons.

The terminal operated by VLI Logistics, one of two at the port of Santos that stores fertilizers, is also full, according to people with knowledge of the matter who asked not to be named because the information is not public.

Fertilizer prices soared to record highs after the war in Ukraine, raising fears of shortages. Brazil imports almost 85% of its fertilizers, and Russia is the leading source country for them.

As supplies normalized, prices have fallen in recent weeks, but farmers are still not buying. According to Marina Cavalcante, an analyst at Bloomberg’s Green Markets, they are waiting for further price reductions.

“Farmers expect that prices will continue to fall after declines last week and the week before,” she said. “So they will wait for further declines to do so.”

Brazil is the world’s largest shipper of several crops, including soybeans. Farmers can delay purchases until the eve of soybean planting in September. But if everyone waits too long, a last-minute rush could cause inland transportation bottlenecks that could leave some of them empty-handed.

With information from Bloomberg