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2021년 10월 30일

Stagflation
Oil
Harvest
USDA’s World Agricultural Outlook Board anticipates 2021/22 corn, soybean, and wheat harvested area to total nearly 1.4 billion acres. In the past two years, an additional 57 million acres of corn, soybeans, and wheat across the world have come into production – a 4.4% increase since 2019.

And those acres need supplemental nutrients to produce profitable yields. Current price levels are encouraging for fertilizer production expansion. But rising natural gas costs as energy supplies run dry mean that the global fertilizer production increase could be thwarted by looming energy shortages in Russia, China and the European Union.

NOAA is currently forecasting a warmer than normal winter across much of the Heartland. Temperatures in the Pacific Northwest and Northern Plains are likely to be cooler than usual. If an unexpected polar vortex hits late in the winter and energy reserves in the Gulf are not adequate, domestic fertilizer production could face more delays.

It will likely be another tight year of global fertilizer supplies as more world players such as India, Brazil, China and Russia compete with the U.S. for available fertilizer supplies. While spring 2022 shortage fears are still largely speculative, farmers are wise to plan for worst-case scenarios regarding 2022 fertilizer applications.

It marks a warranted shift in managerial focus from price risk to operational risk. As we have prominently seen over the past three growing cycles, crop quality and yield – thus revenues – are negatively impacted when farmers halt operations for any reason. And with a rapid rise in weather volatility, waiting on pesticide and fertilizer supplies next spring increases the risk for lower yields next fall.