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Soaring Global Fertilizer Prices Highlight Demand for Manure Technology
2022-04-06

  The main problem facing the agri-food industry right now is soaring fertilizer prices, which shows no real relief as the fighting in Ukraine continues. In this case, manure technology that could make a big difference is grossly underestimated, but that will change in the coming months and years.

  According to DTN, an agricultural commodity market information platform, all fertilizer prices have risen sharply since the start of 2022, and most prices are more than 100 percent higher year-on-year. Russia's invasion of Ukraine is not helping the fertilizer market, it will only make it worse. Russia and Belarus together produce 40% of global potash exports in 2021, with Russia alone accounting for 22% of global ammonia exports, 14% of urea exports and 14% of monoammonium phosphate exports. Earlier this month, Russia's decision to suspend fertilizer exports gave farmers in Brazil and the European Union a "head-on."

  This is a big problem. But it is also a problem that can be solved, and it also means new industry opportunities. In addition to countries successively launching policies and investments to promote sustainable fertilizers in their own countries, such as the U.S. Department of Agriculture’s commitment to invest $250 million in locally-made fertilizers; Brazil launched a new 30-year national fertilizer plan in early March; can help and play a bigger role.

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  According to the Food and Agriculture Organization of the United Nations, manure storage and handling accounts for 25.9% of the greenhouse gas emissions associated with the livestock industry's supply chain, especially methane and nitrous oxide in large quantities. These two greenhouse gases may be more likely to cause "warming" in the short term than carbon dioxide.

  A 2005 assessment by the U.S. Environmental Protection Agency, the country's farms and ranches are estimated to produce about 500 million tons of manure each year, the equivalent of more than 1,000 Empire State Buildings. All of this animal manure represents a huge manure resource and opportunity: we should think of livestock as a "fiber processing system" that produces renewable plant nutrients (especially phosphorus) and, of course, meat.

  According to EPA calculations, animal manure from the livestock industry produces about 6.2 billion kilograms (about 6.8 million tons) of nitrogen and 1.8 billion kilograms (about 2 million tons) of phosphorus annually, and recycling these nutrients alone is worth more than $5 billion . This means that the livestock industry can be seen as a "renewable fertilizer mine," offering an unlimited supply of raw materials and a huge opportunity for recurring income.

Manure is not new, but the conditions are ripe for transformation

  This pressure on fertilizer prices now allows high-quality organic fertilizer products to compete with synthetic fertilizers. Over the past few years, many companies working on manure management technology have struggled to come up with a viable business plan to market fertilizer products outside the high-end organic niche. This has trapped the sector in a chicken-and-egg cycle, leading to weak investment in livestock manure handling, recycling and processing.

  Soil health trends will further drive the attractiveness of fertilizer management techniques in response to climate change issues, and manure application has been shown to have a significant positive impact on the water bodies surrounding farms. Manure-based fertilizer products tend to be richer in organic matter, slower to release, and more bioavailable. In addition, manure reduces the risk of stifling soil biodiversity.

  At current fertilizer price levels, who else would buy synthetic fertilizers that could potentially damage soil health, while ignoring high-quality organic manures at the same price? Existing manure technologies can convert manure into high-quality and stable dehydrated fertilizers, but what has been missing is a business model that works for both livestock producers and crop producers.

  High fertilizer prices will allow forward-looking livestock producers to stay ahead of environmental regulations that will all but be unavoidable, as 111 countries around the world pledge to cut methane emissions by 30 percent by 2030. Investing now in manure treatment solutions that provide returns will diversify the operator’s revenue stream and contribute to stabilizing fertilizer prices through decentralized production. Most importantly, the local community environment will improve, avoiding serious environmental consequences.

  Our caveman ancestors used manure as fertilizer 8,000 years ago, and the future of manure technology is to use microbes to selectively eliminate any pathogens and then screen for beneficial microbes that improve soil and crop health. When farmers use manure, beneficial microorganisms can multiply. This would restore soil health relatively cheaply, improve crop yields, and potentially reduce the cost of chemicals and fertilizers by around 50 percent.

We should take full advantage of this opportunity

  Some of the specific innovations in this area that deserve our attention include: low-cost mechanized treatment systems that produce high-quality organic, high-carbon fertilizers that can compete with synthetic fertilizers; next-generation soil health companies utilizing nutrient-dense manure as feed for microorganisms; efficient liquid and solids filtration separation systems for water reuse in water-scarce, livestock-dominated areas; low-cost, compostable fiber products, especially in the packaging of meat or dairy products; in biodigesters Substantial investment will continue, with waste from many filtration and nutrient extraction systems as feedstock for biogas digesters; and systems that better demonstrate animal manure management techniques that can offset greenhouse gases and other pollutants.

  The start of 2022 has been a chaotic journey and unfortunately, from farmers to consumers, prices are under enormous pressure. We can all be better off by turning pressure into a driving force and encouraging the adoption of new technologies to solve this problem: the farms that grow the food, the livestock farms, the fertilizer companies, and the consumers who eat, drink and live on this planet. The sooner we get serious about the value of livestock manure, the better.

  We are generally reluctant to make VC-style futuristic predictions because that just contributes to the hype cycle. However, at this stage, there is a strong sense in the industry that manure technology has been seriously underestimated, so 2022 may be a historical turning point for this sub-category.