Apart from the rising costs of crude oil and farm vehicles, the agricultural industry faces a new challenge: steep fertilizer prices. Reports indicate a 30% year-over-year cost increase. Greengrocers and farmers subsequently adjusted their prices to compensate for their losses—further contributing to the swelling global inflation rates.
Fertilizer prices might not normalize soon. But Mike Straumietis, the CEO and founder of Advanced Nutrition, shares that retailers and farmers alike can adapt better after understanding the factors behind price shifts.
Importation of Minerals
The U.S. currently imports fertilizer minerals like potash and phosphate. Although cost-effective, it can also leave the country defenseless to mining and logistical disruptions worldwide. The U.S. agricultural industry currently has minimal control over the local supply and demand.
Prices of fertilizers sky-rocketed in recent years due to high demand and low supply. Fertilizer prices will only normalize once the U.S. depends less on imported minerals. Fortunately, the country has vast mineral resources that it can rely on if needed. Its agricultural industry could start sourcing raw materials locally if miners shift their focus to extracting fertilizer minerals.
Steep Crude Oil Rates
Steep crude oil rates hurt revenue, and Mike Straumietis shares that retailers and manufacturers adjust their fertilizer prices to maintain good profit margins. After all, the agricultural industry heavily relies on gasoline and diesel vehicles. For instance, farming vehicles distribute fertilizers on large fields, while mining equipment extracts fertilizer minerals for fertilizer brands.
Global Logistics Issues
There has been a lot of activity on the world political scene in recent years. While it may not be obvious immediately, these things impact the supply chain. Logistics issues stemming from territorial conflicts, disease outbreaks, and travel restrictions cripple the local fertilizer supplies. Again, the U.S. imports most of the fertilizer minerals it uses. Because of these factors, manufacturers have no choice but to wait as long as needed for their raw materials from overseas suppliers.
Lack of Mining Operations
The pandemic halted hundreds of mining projects nationwide. This put a large number of miners out of work, which has had a ripple effect on other areas of the economy. Thankfully, miners are gradually returning to mining sites, although they might take years to operate at full capacity again.
Spending Less on Fertilizer Without Compromising Quality
Farmers don’t need a nationwide overhaul of the fertilizer industry to unlock the full genetic potential of their plants. Instead, Mike Straumietis encourages creating custom plant feeding schedules. You can use an accurate nutrient calculator to determine your crops’ needs. Advanced Nutrients has a nutrient calculator that was designed specifically with this in mind. Be sure to check out the new tool as well as the wide array of plant nutrients they have available.
