The fertiliser supply situation for the coming spring is looking brighter following the news that CAN producers across Europe are to resume production.

The move by Europe’s manufacturers follows the recent reduction in gas prices, which have fallen from a high of €350/kwh earlier this year to €118/kwh.

The high prices of this summer resulted in the closure of 70% of the EU’s nitrogen production capacity.

However, with CAN production resumed the threat to fertiliser supplies for the coming year appears to have receded.

Irish importers are still not committing to buying large volumes of product as they maintain that the market and prices are still not settled.

However, market movements over the last 10 days would suggest a definite softening in farmgate prices from last year’s record levels.

Logistics

One industry source warned of a “logistical nightmare” coming down the line if fertiliser buying doesn’t see a major pickup.

“There’s nobody buying huge amounts at the minute, even though the price of gas has come back a bit. There seems to be no panic on the manufacturers to sell fertiliser in Europe either,” he said.

Fertiliser purchases, he explained, are 30% to 50% back on last year in Europe.

“The importers are not bringing in stocks of fertiliser to us and stocks are way down on last year.

“Farmers are going to have to buy the first couple of rounds of fertiliser now to have fertiliser,” he said.