NZ Herald
  • Home
  • Latest news
  • Herald NOW
  • Video
  • New Zealand
  • Sport
  • World
  • Business
  • Entertainment
  • Podcasts
  • Quizzes
  • Opinion
  • Lifestyle
  • Travel
  • Viva
  • Weather

Subscriptions

  • Herald Premium
  • Viva Premium
  • The Listener
  • BusinessDesk

Sections

  • Latest news
  • New Zealand
    • All New Zealand
    • Crime
    • Politics
    • Education
    • Open Justice
    • Scam Update
  • Herald NOW
  • On The Up
  • World
    • All World
    • Australia
    • Asia
    • UK
    • United States
    • Middle East
    • Europe
    • Pacific
  • Business
    • All Business
    • MarketsSharesCurrencyCommoditiesStock TakesCrypto
    • Markets with Madison
    • Media Insider
    • Business analysis
    • Personal financeKiwiSaverInterest ratesTaxInvestment
    • EconomyInflationGDPOfficial cash rateEmployment
    • Small business
    • Business reportsMood of the BoardroomProject AucklandSustainable business and financeCapital markets reportAgribusiness reportInfrastructure reportDynamic business
    • Deloitte Top 200 Awards
    • CompaniesAged CareAgribusinessAirlinesBanking and financeConstructionEnergyFreight and logisticsHealthcareManufacturingMedia and MarketingRetailTelecommunicationsTourism
  • Opinion
    • All Opinion
    • Analysis
    • Editorials
    • Business analysis
    • Premium opinion
    • Letters to the editor
  • Politics
  • Sport
    • All Sport
    • OlympicsParalympics
    • RugbySuper RugbyNPCAll BlacksBlack FernsRugby sevensSchool rugby
    • CricketBlack CapsWhite Ferns
    • Racing
    • NetballSilver Ferns
    • LeagueWarriorsNRL
    • FootballWellington PhoenixAuckland FCAll WhitesFootball FernsEnglish Premier League
    • GolfNZ Open
    • MotorsportFormula 1
    • Boxing
    • UFC
    • BasketballNBABreakersTall BlacksTall Ferns
    • Tennis
    • Cycling
    • Athletics
    • SailingAmerica's CupSailGP
    • Rowing
  • Lifestyle
    • All Lifestyle
    • Viva - Food, fashion & beauty
    • Society Insider
    • Royals
    • Sex & relationships
    • Food & drinkRecipesRecipe collectionsRestaurant reviewsRestaurant bookings
    • Health & wellbeing
    • Fashion & beauty
    • Pets & animals
    • The Selection - Shop the trendsShop fashionShop beautyShop entertainmentShop giftsShop home & living
    • Milford's Investing Place
  • Entertainment
    • All Entertainment
    • TV
    • MoviesMovie reviews
    • MusicMusic reviews
    • BooksBook reviews
    • Culture
    • ReviewsBook reviewsMovie reviewsMusic reviewsRestaurant reviews
  • Travel
    • All Travel
    • News
    • New ZealandNorthlandAucklandWellingtonCanterburyOtago / QueenstownNelson-TasmanBest NZ beaches
    • International travelAustraliaPacific IslandsEuropeUKUSAAfricaAsia
    • Rail holidays
    • Cruise holidays
    • Ski holidays
    • Luxury travel
    • Adventure travel
  • Kāhu Māori news
  • Environment
    • All Environment
    • Our Green Future
  • Talanoa Pacific news
  • Property
    • All Property
    • Property Insider
    • Interest rates tracker
    • Residential property listings
    • Commercial property listings
  • Health
  • Technology
    • All Technology
    • AI
    • Social media
  • Rural
    • All Rural
    • Dairy farming
    • Sheep & beef farming
    • Horticulture
    • Animal health
    • Rural business
    • Rural life
    • Rural technology
    • Opinion
    • Audio & podcasts
  • Weather forecasts
    • All Weather forecasts
    • Kaitaia
    • Whangārei
    • Dargaville
    • Auckland
    • Thames
    • Tauranga
    • Hamilton
    • Whakatāne
    • Rotorua
    • Tokoroa
    • Te Kuiti
    • Taumaranui
    • Taupō
    • Gisborne
    • New Plymouth
    • Napier
    • Hastings
    • Dannevirke
    • Whanganui
    • Palmerston North
    • Levin
    • Paraparaumu
    • Masterton
    • Wellington
    • Motueka
    • Nelson
    • Blenheim
    • Westport
    • Reefton
    • Kaikōura
    • Greymouth
    • Hokitika
    • Christchurch
    • Ashburton
    • Timaru
    • Wānaka
    • Oamaru
    • Queenstown
    • Dunedin
    • Gore
    • Invercargill
  • Meet the journalists
  • Promotions & competitions
  • OneRoof property listings
  • Driven car news

Puzzles & Quizzes

  • Puzzles
    • All Puzzles
    • Sudoku
    • Code Cracker
    • Crosswords
    • Cryptic crossword
    • Wordsearch
  • Quizzes
    • All Quizzes
    • Morning quiz
    • Afternoon quiz
    • Sports quiz

Regions

  • Northland
    • All Northland
    • Far North
    • Kaitaia
    • Kerikeri
    • Kaikohe
    • Bay of Islands
    • Whangarei
    • Dargaville
    • Kaipara
    • Mangawhai
  • Auckland
  • Waikato
    • All Waikato
    • Hamilton
    • Coromandel & Hauraki
    • Matamata & Piako
    • Cambridge
    • Te Awamutu
    • Tokoroa & South Waikato
    • Taupō & Tūrangi
  • Bay of Plenty
    • All Bay of Plenty
    • Katikati
    • Tauranga
    • Mount Maunganui
    • Pāpāmoa
    • Te Puke
    • Whakatāne
  • Rotorua
  • Hawke's Bay
    • All Hawke's Bay
    • Napier
    • Hastings
    • Havelock North
    • Central Hawke's Bay
    • Wairoa
  • Taranaki
    • All Taranaki
    • Stratford
    • New Plymouth
    • Hāwera
  • Manawatū - Whanganui
    • All Manawatū - Whanganui
    • Whanganui
    • Palmerston North
    • Manawatū
    • Tararua
    • Horowhenua
  • Wellington
    • All Wellington
    • Kapiti
    • Wairarapa
    • Upper Hutt
    • Lower Hutt
  • Nelson & Tasman
    • All Nelson & Tasman
    • Motueka
    • Nelson
    • Tasman
  • Marlborough
  • West Coast
  • Canterbury
    • All Canterbury
    • Kaikōura
    • Christchurch
    • Ashburton
    • Timaru
  • Otago
    • All Otago
    • Oamaru
    • Dunedin
    • Balclutha
    • Alexandra
    • Queenstown
    • Wanaka
  • Southland
    • All Southland
    • Invercargill
    • Gore
    • Stewart Island
  • Gisborne

Media

  • Video
    • All Video
    • NZ news video
    • Herald NOW
    • Business news video
    • Politics news video
    • Sport video
    • World news video
    • Lifestyle video
    • Entertainment video
    • Travel video
    • Markets with Madison
    • Kea Kids news
  • Podcasts
    • All Podcasts
    • The Front Page
    • On the Tiles
    • Ask me Anything
    • The Little Things
  • Cartoons
  • Photo galleries
  • Today's Paper - E-editions
  • Photo sales
  • Classifieds

NZME Network

  • Advertise with NZME
  • OneRoof
  • Driven Car Guide
  • BusinessDesk
  • Newstalk ZB
  • Sunlive
  • ZM
  • The Hits
  • Coast
  • Radio Hauraki
  • The Alternative Commentary Collective
  • Gold
  • Flava
  • iHeart Radio
  • Hokonui
  • Radio Wanaka
  • iHeartCountry New Zealand
  • Restaurant Hub
  • NZME Events

SubscribeSign In

Advertisement
Advertise with NZME.
Premium
Home / Business

Worldwide commodities boom drives fertiliser prices to 10-year highs

Jamie Gray
By Jamie Gray
Business Reporter·NZ Herald·
25 Jun, 2021 05:38 AM4 mins to read

Subscribe to listen

Access to Herald Premium articles require a Premium subscription. Subscribe now to listen.
Already a subscriber?  Sign in here

Listening to articles is free for open-access content—explore other articles or learn more about text-to-speech.
‌
Save

    Share this article

    Reminder, this is a Premium article and requires a subscription to read.

Higher shipping costs have added to already high fertiliser prices. Photo / Hawke's Bay Today

Higher shipping costs have added to already high fertiliser prices. Photo / Hawke's Bay Today

The world-wide commodities boom has driven world fertiliser prices to 10-year highs.

Global food prices have recorded their biggest annual rise in a decade, driven in part by China's soaring appetite for grain and soyabeans and a severe drought in Brazil, which has put fertiliser in hot demand.

The UN's Food and Agriculture Organisation (FAO) said global food prices rose last month at their fastest monthly rate in more than a decade, even as world cereal production was on course to reach a new record high.

The FAO's Food Price Index averaged 127.1 points in May, 4.8 per cent higher than in April and 39.7 per cent higher than in May 2020.

Advertisement
Advertise with NZME.

A surge in the international prices of vegetable oils, sugar and cereals led the increase in the index, which tracks monthly changes in the international prices of commonly-traded food commodities, to its highest value since September 2011 and only 7.6 per cent below its all-time peak in nominal terms, the FAO said in a report.

Mike Whitty, general manager supply chain for the farmer-owned fertiliser co-op, Ravensdown, said fertiliser prices had been unusually strong on the back of higher food demand.

"What we have seen is significant demand for food and you require nutrient to produce food.

"That's come off a pretty depressed market over the last couple of years, both economically and climatically," he said.

Advertisement
Advertise with NZME.

The commodities boom had come at a time when inventories for grains and other commodities were low, coupled with significant demand coming from North America, Brazil and India.

"It's on the back of very good food prices for commodities, such as grains," Whitty said.

"Countries are looking to build up their inventory of food, so what we are seeing is a major squeeze in the market since early this year.

"Right around the world farmers are looking to meet that demand and so nutrient is key to providing the food that everybody wants."

The price of DAP - or di-ammonium phosphate - a widely used fertiliser that is manufactured overseas and imported into New Zealand - has hit a 10-year high of nearly $1000 a tonne - up from $800/tonne a year ago.

Higher food production requires fertilise. Photo / File
Higher food production requires fertilise. Photo / File

"It is quite consistent across all of the major products - potash DAP, urea, sulphur - they are all at 10-year highs now.

"We look at these things on a daily basis and the sheer pace of the increase has been somewhat surprising," Whitty said.

In addition, freight rates were firming significantly as the world's supply chain struggled to normalise in the wake of Covid-19.

Advertisement
Advertise with NZME.

Rates for containerised freight are up by 300 to 400 per cent and the same goes for bulk cargo after a period of low demand over the two years prior to Covid-19.

"With economies starting to come out of Covid being supported by governments, the demand has spiked significantly.

"We are seeing freight rates for bulk vessel on a hirage basis three times where they were last year."

Urea has gone from $600 a tonne to $800/tonne.

UK-based commodities research house ICIS said international fertiliser markets are experiencing an unseasonal boost in prices and demand, with some prices hitting historical highs.

"The major question now for producers, traders, co-operatives and farmers, is if current levels will be sustained and what availability will look like moving through the second half of 2021," ICIS said in a report.

"While some markets are exclusively impacted by production cuts, rising feedstock costs, sanction cuts, rising freight rates, a major driver giving the market confidence is record crop prices," it said.

The unabated strength of ammonia, which has also been driving the price up for urea and nitrates, looked to remain a challenging market, where, on almost a daily basis, production problems are announced, it said.

Higher commodities prices have prompted talk that the world might be on the verge of a commodities supercycle.

Early this year, Goldman Sachs said: "Looking at the 2020s, we believe that similar structural forces to those which drove commodities in the 2000s could be at play."

Goldman's supercycle view is based on how the world will recover from the Covid-19 crisis with an emphasis on a green industrial revolution and a policy focus on social need.

Save

    Share this article

    Reminder, this is a Premium article and requires a subscription to read.

Latest from Business

Business

Kiwi stole millions from his dad, reportedly blamed dad's girlfriend

Business

Government's giant internet, security upgrade under way for 2500 schools

Business
|Updated

United Airlines profits dip, company says world getting 'less uncertain'


Sponsored

Tired of missing out on getting to global summits to help grow your business?

Advertisement
Advertise with NZME.

Latest from Business

Kiwi stole millions from his dad, reportedly blamed dad's girlfriend
Business

Kiwi stole millions from his dad, reportedly blamed dad's girlfriend

'Treacherous, deceitful and calculated caper' blamed on elderly man's girlfriend.

17 Jul 02:43 AM
Government's giant internet, security upgrade under way for 2500 schools
Business

Government's giant internet, security upgrade under way for 2500 schools

17 Jul 02:00 AM
United Airlines profits dip, company says world getting 'less uncertain'
Business
|Updated

United Airlines profits dip, company says world getting 'less uncertain'

17 Jul 12:19 AM


Tired of missing out on getting to global summits to help grow your business?
Sponsored

Tired of missing out on getting to global summits to help grow your business?

14 Jul 04:48 AM
NZ Herald
  • About NZ Herald
  • Meet the journalists
  • Newsletters
  • Classifieds
  • Help & support
  • Contact us
  • House rules
  • Privacy Policy
  • Terms of use
  • Competition terms & conditions
  • Our use of AI
Subscriber Services
  • NZ Herald e-editions
  • Daily puzzles & quizzes
  • Manage your digital subscription
  • Manage your print subscription
  • Subscribe to the NZ Herald newspaper
  • Subscribe to Herald Premium
  • Gift a subscription
  • Subscriber FAQs
  • Subscription terms & conditions
  • Promotions and subscriber benefits
NZME Network
  • The New Zealand Herald
  • The Northland Age
  • The Northern Advocate
  • Waikato Herald
  • Bay of Plenty Times
  • Rotorua Daily Post
  • Hawke's Bay Today
  • Whanganui Chronicle
  • Viva
  • NZ Listener
  • Newstalk ZB
  • BusinessDesk
  • OneRoof
  • Driven Car Guide
  • iHeart Radio
  • Restaurant Hub
NZME
  • About NZME
  • NZME careers
  • Advertise with NZME
  • Digital self-service advertising
  • Book your classified ad
  • Photo sales
  • NZME Events
  • © Copyright 2025 NZME Publishing Limited
TOP