Farmers are cautious over the ability of grain and oilseed prices to stay near record highs, and the impact of US drought on profits, prompting a continued reluctance to commit in advance to fertilizer purchases, PhosAgro said.
The phosphates and nitrogen group said that demand for nutrients had proved “strong” in the first half of the year, boosted towards the end of the period by the return of India, the top importer, to buy-ins.
However, this disguised a trend among primarily US and European growers to delaying purchased “until the actual application season started”.
In part this is due to concerns over the ability of prices to maintain their rally, which has driven Chicago corn and soybean futures to record highs.
Farmers were badly caught out in 2008 by a collapse in crop values as the global recession hit, hurt in part by inventories of fertilizers they had built-up at high prices, which tumbled too.
The concerns chime with worries among Chicago investors too that futures may repeat their declines of last year, when corn prices tumbled 28% from a late-August peak as funds sold-off.
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