1/3 of the food produced in the world goes to waste

| Foreign Markets |

“A billion people in the world suffer from undernourishment. Each year 10 million people starve to death. Each 6 seconds one child dies of starvation somewhere in the world. If we reduce food waste by 5%, 4 million people could be saved” – such pieces of information can be found on leaflets and posters from a public awareness campaign initiated in China in 2013 and aimed at reducing food waste. According to publications by Global food losses and food waste, the problem concerns many countries other than China, and it constitutes a challenge for their governments.

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The great Chinese leap

| Foreign Markets |

At the moment of joining the International Fund for Agricultural Development in 1980, China was a relatively poor country, struggling with the task of providing food for its numerous population. Then, over the following 35 years, the importance of Chinese agriculture in the global economy has risen dramatically.

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Family farms are the future

| Production & Resources |

According to up-to-date research about family-owned farms, such businesses are very productive and may be able to feed all the people in the world. Their development could be the way to ensure food supply safety for the constantly growing population.

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China is betting on fertilizers

| Foreign Markets |

Fertilizers production is a leading sector of the chemical industry in China. The country is also a primary consumer of those products. The reason could not be more obvious, with the population of People’s Republic of China approaching 1,5 billion people.

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Global changes in agriculture

| Foreign Markets |

37% of the world’s population makes a living working in agriculture, which is defined as cultivating farmland, fishing, forestry and hunting. This proportion has fallen by 12% since 1980, when almost 50% of people on Earth found employment in agriculture, while the other half of the population worked in other sectors of the economy.

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China is betting on fertilizers

| Foreign Markets |

Fertilizers production is a leading sector of the chemical industry in China. The country is also a primary consumer of those products. The reason could not be more obvious, with the population of People’s Republic of China approaching 1,5 billion people.

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Fertilizers market in 2014. What will New Year bring?

| Foreign Markets |

According to IFA (International Fertilizers Association) forecast, the global demand in 2013/2014 season will reach 179.5 million tonnes. In 2012/2013 season, fertilizers consumption stood at c. 176 million tonnes of total NPK ingredients. What is especially interesting, though, is IFA forecast for 2014/2015. In this season, the global consumption of NPK ingredients is expected to reach 184.3 million tonnes!

Phosphorous market in 2014

The end of 2013 provides a good opportunity to take a look at the factors which are to shape the global fertilizers trade in 2014. To a large extent, the phosphorous fertilizers market shall depend on demand in India, where DAP (diammonium phosphate) market is likely to revive. Specialists also point at the reassuring long-term weather forecast concerning monsoons in this part of Asia. DAP inventory is estimated to reach 1.5-1.7 million tonnes in April 2014, while in April 2013 the stock was nearing 4 million tonnes. Seeing that consumption in 2014/2015 is to be 9 million tonnes, while the local production is only 3.5 million tonnes, imports ought to reach 5 million tonnes.

Fertilizers market in 2014. What will New Year bring?/fot. photopin.comThe situation on potassium fertilizers market

When it comes to potassium, the key ingredient shaping prices will be the changes caused by the break up of BPC, a trading company which joined the potentials of Russian and Belorussian manufacturers of those fertilizers. One of the results of BPC dissolution is the visible fall of the market share of those producers on the global potassium market, with the gap being filled by American companies. Another factor influencing the future situation is the fact that those two manufacturers (Belaruskali from Belarus and Uralkali from Russia) are going to aim at regaining their position. Considerable market surplus of potassium is therefore observed. This will have grave consequences for PotashCorp, an American corporation, which prepares a restructuring plan and massive lay-offs of 1000 staff. The move to reduce cost by the American giant will surely increase price pressure in 2014.

Fertilizers market in 2014. What will New Year bring?/fot. photopin.comConsumption of nitrogen fertilizers in 2014

Nitrogen fertilizers market will be determined by Chinese policy on the export duty on urea, with the highest rate of 15% plus CNY 40/t, and the lowest at CNY 40/t (c. 6,5 USD/t) in July – October.

Urea exportation from China was 7 million tonnes in 2012, while in the first ten months of 2013 exports have reached 6.5 million tonnes. Assuming that urea price in China is c. CNY 1600/t and taking into consideration plus 15% and CNY 40 as the total of export duty, FOB price in China may reach USD 340/t in 2014, while today it is USD 325/t.

Urea trade is also linked to demand in India. National Fertilizers Department has suggested that India will return to the global urea market in March 2014. Demand is unlikely to be high, however, as the stock in India is still considerable. American imports are likely to follow the same trend.

Cheaper gas in Ukraine

The last important factor in 2013, influencing the situation in 2014, is the change of the price of gas sold to Ukraine. The decrease by 30% will prompt the fertilizer installations in Ukraine to reopen production. There is little probability, though, that the quantity of fertilizers meant for export will rise suddenly.

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