A source of eFarmNewsAr.com in the fertilizers supply chain told that they are expecting a larger wheat area this year, which will push the demand of urea, UAN and phosphates. Last week, officials from the Buenos Aires Grain Exchange anticipated that wheat area could grow 200K hectares to 6.4 million and output surpass 20 million metric tons, probably very close to 21 million.
“There are some people in the business talking about 300 or 400K more wheat hectares this campaign, due to the low farmer’s interest into planting barley and sunflower”, the source said. He explained that the price spread between barley and wheat favors to this last one, while there is a weak demand over sunflower, and its commercialization is not being easy.
Fertilizers industry estimates that last year farmers used 1.35 MMT of fertilizers in the wheat and barley campaign. According to our source, this year demand would increase to 1.40 MMT or more. “Despite prices relationship is not so good as in recent years, the farmers have internalized the convenience of using a good fertilization program in their crops”, the source added.
It is expected that imports of urea remaining firm, in a 35/65 relationship with domestic production. “Despite a volatile global price scenario, we think that urea prices will remain stable during next month. Sales are moving slower than the past year, as farmers are focused on collecting soybean and corn, but we expect that in the next thirty days, sales will accelerate significantly”, he said.
The source doesn’t see serious changes in the nutrients sale portfolio, between nitrogen sources, i.e. urea versus UAN (urea ammonium nitrate). Last year, urea imports reached 780K tons while UAN reached 560K tons. This proportion would maintain stable this year too.