Commodities Shuttle: Fertilizer imports from Russia fall 9%, and Brazil diversifies suppliers

Despite the global difficulties in purchasing fertilizers this year, Brazil imported a record volume of this input in April. The bill, however, due to high international prices, was high.

There were 3.25 million tons purchased in April, 71% more than in the same month last year. As a result, Brazil has already imported 11.2 million tons from January to April and 42.2 million in the last 12 months.

Purchases from Russia, the main source of fertilizers for Brazil, dropped 9% in the first four months of this year, compared to January and April 2021. Last month, the Russians supplied 660 thousand tons of fertilizer to Brazilians, a volume 4 % lower than in March.

Russia, which has been the leader in exports to Brazil since 2009, was responsible for 22% of the fertilizer imported by Brazil in the first four months, by supplying 2.45 million tons of the input.

Canada, China, Nigeria and Israel have increased the supply of product to Brazil. From January to April, China and Canada exported 1.7 million and 1.1 million tons, respectively, to Brazil. Even Venezuela has increased exports, supplying 65,000 tonnes in the first four months of the year.

Rising oil, expensive energy, reduced production at some mines and difficulties in international trade have been putting great pressure on fertilizer prices since last year.

Brazilian imports from January to April, although they rose only 6%, in volume, forced the country to spend 147% more on the purchase of these inputs.

In the first four months of last year, spending had totaled US$ 2.62 billion. In this quarter, they reached US$ 6.48 billion.

Brazil’s external dependence on fertilizers was accentuated with the country’s agricultural expansion. Ten years ago, Brazilian farmers cultivated 50.9 million hectares in grain crops. In this harvest, the area jumped to 73.4 million.

This increase in area allowed the country to go from an annual harvest of 166 million tons of grain in 2011/12 to the current 270 million, according to data from Conab (National Supply Company).

The initial estimate for the Brazilian crop was 290 million tons in the 2021/22 period, a volume frustrated by the recurring climatic problems of recent years. Last year, drought and frost broke the corn crop. This year, it was soy.

A large part of the imported fertilizer is destined for the soybean and corn crops. In the last five years, the areas of these products have increased by 22%. Oilseeds reached 41 million hectares, and cereals rose to 21.5 million.

Although smaller, cotton increased 78%, totaling 4.1 million hectares, according to the most recent data from Conab.

The Ukrainian War made Russia reduce purchases of some products in Brazil in April. Among them are coffee, meats, soy and sugar.

The Russians, however, prepared in the months leading up to the conflict. The volume of soybean purchases increased 136% in the four-month period, and that of sugar, 785%.

The Brazilian agricultural expansion also made the country dependent on agrochemicals. In the first four months of this year, foreign purchases of pesticides (classified by the Ministry of Agriculture as herbicides, fungicides, insecticides, acaricides and others) totaled 146,700 tons, 64% more than in the same period last year, from according to data from Secex (Secretariat of Foreign Trade).

The greatest evolution in the period came from herbicides, whose imports reached 87 thousand tons, well above the 31 thousand in the same period last year.

Foreign purchases of insecticides fell by 20%, in volume, and those of fungicides increased by 24%. Spending on agrochemicals rose to US$ 1.3 billion this year, 92% above those from January to April of last year.