— UN Secretary General António Guterres at the ministerial meeting "Roadmap for Global Food Security - Call for Action" said that Russian-made food and fertilizers should be allowed on world markets to resolve the food crisis.

What is the current situation with the supply of Russian fertilizers abroad, given that the US and the EU have not formally restricted their imports?

Leonid Kholod:

The Russian Federation is one of the largest suppliers of mineral fertilizers to the world market.

But due to sanctions, the export of products stopped, there were problems with logistics and payment.

Foreign traders often do not understand how to interact with Russian suppliers, and they, in turn, are afraid of possible problems.

Svetlana Avdasheva:

Now the main obstacle to the supply of Russian products has become breaks in supply chains: international transport companies refuse to enter Russian ports.

— Can we talk about a crisis in the global fertilizer market?

SA:

In 2020, energy prices began to rise.

Therefore, an increase in the price of mineral fertilizers was inevitable, especially considering that they are a non-renewable limited resource.

A steady rise in prices has been observed for several years in a row, and especially during the coronavirus pandemic.

But now, due to a disruption in supply chains, it could be just fantastic.

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  • © Nemanja Otic

— What is the share of Russian fertilizers in the world and, in particular, in the European market?

L.Kh.:

Back in Soviet times, this industry was actively developing, since appropriate raw materials sources were developed - phosphorites, potash salts, etc.

At the end of 2021, the Russian Federation supplied 37.6 million tons of mineral fertilizers to the world market for $12.5 billion. This is about 20% of the export of fertilizers in the world, which allows us to talk about Russia as one of the largest players in the world market.

SA:

Let me remind you that there are several types of mineral fertilizers, and Russia's share in the production of each of them is quite high.

But especially in the field of potash fertilizers, which account for a quarter of the world market for these substances.

In the European Union, this figure is about 60%.

Brazil and China are among the largest buyers of Russian potash fertilizers.

There are countries in Africa and Southeast Asia where supplies of Russian potash fertilizers completely meet demand.

— How dependent is the West on Russian fertilizers?

Are there alternative providers?

L.Kh.:

Latin America and European countries are the main importers of Russian and Belarusian products.

They have an alternative in choosing suppliers, but such a transition takes time and money.

It is also possible to increase the production of potash and phosphorus fertilizers if there are appropriate deposits and processing capacities.

It is more difficult with nitrogen fertilizers, the production of which requires not only a large and equipped enterprise, but also a lot of gas.

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SA:

Russia holds 10% of the US mineral fertilizer market.

If, relatively speaking, they want to raise prices for their farmers and refuse Russian products, then, perhaps, Canada will be able to supply them with the necessary substances.

The situation in the EU is more complicated.

Germany is practically the only country that has its own production of potash fertilizers, but it is difficult to say how much German supplies can replace Russian supplies for the whole of Europe.

If Canada reorients its exports of mineral fertilizers to the US, then it will not sell them to Africa and Southeast Asia at the same price.

Accordingly, prices will be higher.

Russian suppliers can provide discounts to potential buyers.

“Now at the highest levels there is talk of a possible world famine.

Such forecasts are heard not only in Russia.

How likely is this?

And what role can the situation on the world market of mineral fertilizers play here?

L. Kh.:

In Europe, as in most countries, chernozem soils are rare and the lands are severely depleted.

A lot of fertilizer is required to maintain normal yields.

Without them, it can fall critically, respectively, prices will rise.

Needless to say, such a scenario would not contribute to solving the problem of hunger.

SA:

The market of mineral fertilizers plays a key role in this case.

So, it cannot be ruled out that the rejection of this resource will lead to the fact that the harvest can be reduced by a third.

However, this does not mean that the whole world will starve.

But global famine in the sense of food shortages in a group of countries and regions is quite possible.