Welcome to the land world
US Fertiliser Prices Hit A Nine-year High

Higher agricultural prices this year have encouraged farmers to expand grain production. This has also boosted the demand for fertilizer. As a result, North American fertilizer prices hit a 9-year high this week.

The latest commodity report says farmers are spraying more fertilizer on their fields to increase crop yields, and rising prices are due to a combination of drought and disruptions to supply chains caused by the pandemic. Fertilizer prices are being driven by higher transport costs, tariffs, and energy costs, as well as constraints on the availability of nitrogen, potash, and phosphate.

It is too early to say whether fertilizer prices will remain at current levels, but higher farming costs will put more upward pressure on food prices. Citi surveyed more than 100 farmers in the southwest in March. Of these, 92% thought the price of nitrogen would rise, 90% thought phosphates, and 77% thought potassium and alkali would rise.

Food inflation pressures were low in the first half of the year, partly due to a high food price base in the first half of last year, which could put additional pressure on us inflation in the second half if food prices continue to rise.

Earlier, the U.S. PCE price index rose 4.2 percent in July from a year earlier, the highest level since 1991. Given that, the Fed's days on the sidelines may be not longer.