The US is capable of making all the fertilizer inputs we need. Here’s my understanding. In general, the prime ingredient is natural gas, which we have in abundance. The reason the US imports at all is there’s a cost advantage as the capability wasn’t necessary in the US and we didn’t always have this incredible abundance of natural gas. Therefore, we didn’t need to produce fertilizer and building the capacity wasn’t worth it at the present price. But as the global supply chain collapses, that will change. Not overnight. But the US will be fine. There is currently a lot of farmlands that are being held out of production on purpose to keep the prices high. (Yes, you read that correctly. Thank our government which is deathly afraid of “deflation.”)
Russia is the world’s number one supplier of grains and fertilizer. Their primary market for grains is the Middle East and for fertilizer is China. Russia has stopped all grain exports, as has Ukraine. (For different reasons, obviously.) There’s no planting going on in Ukraine, which is the world’s number five supplier...also to the Middle East. The last time there was a food crisis in the Middle East we had “The Arab Spring.” (Russian crops failed for two years in a row...fires and locusts.)
The huge impact is going to be to the Middle East and to China. As there’s one global market those purchasers will drive up the world price. Invest in Archer Daniel’s Midland...
Russia has been the top exporter of WHEAT, followed by Ukraine. American exports of corn and soybeans make US the top exporter of foodstuffs.
I’m reading that there’s a shortage of natgas at the plants that make ammonium nitrate. This will hurt our corn crop; corn is notoriously hungry for nitrogen, and since too much of our industrial rowcropping doesn’t practice rotation anymore, soils are nitrogen-deficient unless slathered with ammonium nitrate every season. And water. Corn requires a lot of water, so it’s drought-sensitive, too.
Meanwhile my eastern Ohio region’s small farmers are heavy into grass-fed beef. Going to be laughing all the way to the bank.