The Phosphate Crisis - Part One
Tim Hammerich
News Reporter
Phosphate prices remain stubbornly high, and relief doesn’t seem to be coming soon. Itafos CEO David Delaney says that current geopolitical issues are exposing a lack of domestic phosphate production capacity.
Delaney… “ I would say we are, Tim, in a global phosphate crisis. With the war restarting here over the last week, I don't see this ending anytime soon.”
Delaney said a prolonged period of depressed prices made it so companies had very little incentive to expand capacity.
Delaney… “ The U.S. was a predominant supplier of phosphate to the world. China was a big importer, and then China decided to develop their own industry, so they went from an importer of phosphate to the world's largest exporter of phosphate. In the 2010s, they were about a third of global trade. If you consider DAP and MAP traded globally around thirty million tons, they were about ten or 11 of that. And from that, you had extremely depressed prices, commodity prices in general, from 2014 to 2020. And when you go through a period of decline like that, what happens is nobody builds new capacity. You just can't afford to do it.”
With capacity down, geopolitical instability and a squeeze on sulfur, phosphate prices don’t seem to be coming down any time soon.
