Mike Straumietis: The Implications of Surging Fertilizer Costs on Food Security

Mike Straumietis is the Founder and CEO of Advanced Nutrients. Through a series of blogs, he tackles various issues in agriculture. In this post, he discusses the increasing fertilizer prices that have plagued the industry and their possible effects on food security.

Rising Fertilizer Prices

Like humans, plants need a variety of nutrients to thrive and flourish. The primary nutrients they need are nitrogen, phosphorus, and potassium. The forms of nitrogen they require to come in liquid nitrogen, anhydrous ammonia, or urea. Meanwhile, phosphorus as fertilizer comes in monoammonium phosphate and diammonium phosphate. In recent times, all of these materials have had an increase in prices. There are a number of factors that affect this on a national scale.

When comparing prices now to those of back in September 2020, ammonia has increased by more than 210 percent, liquid nitrogen rose by more than 159 percent, urea got up 155 percent, monoammonium phosphate is up 125 percent, and diammonium phosphate surged by more than 100 percent. Potassium’s price also jumped by 134 percent.

Mike Straumietis states that all of these have contributed to an inflation of fertilizer costs.

Some other factors that have resulted in higher fertilizer prices include the Russia-Ukraine war and the ensuing sanctions on Russia for its perceived aggression in the region. Currently, Russia accounts for nearly 14 percent of global fertilizer exports. Because of the conflict, the country has suspended some of its outgoing trade. The lack of supply has resulted in more expensive production and distribution of fertilizers.

The U.S. has been somehow able to adapt to the situation. For example, Mike Straumietis explains that the country has been able to compensate for the lack of delivery of fertilizer and raw materials from Russia by importing from alternate sources, such as Australia, Egypt, Saudi Arabia, Mexico, and others. Unfortunately, the same cannot be said for other nations, particularly emerging and developing economies.

Global Food Security Concerns

It has been around ten years since the world experienced a global food crisis. Humanity experienced two instances of food crises in five years during that time.

The year 2007 saw the world tackle a food price crisis possibly brought about by droughts in grain-producing countries, significant increases in oil prices, increased demand for food, and a surge in fertilizer prices. The world recovered near the second half of 2008, but the resulting volatility in the food market partly led to another world food crisis from 2010 to 2012.

While the world is still not in crisis mode, Mike Straumietis sees some signs of a food catastrophe. One reason is that fertilizer prices are seeing a huge spike, which was also present during the onset of the 2007-08 food crisis.

Higher fertilizer costs have direct and indirect effects on agricultural production and profitability. Because farmers and growers must account for increased expenses, they might have to compensate in other ways to avoid losses. Farmers sometimes need to lower their production due to the lack of resources.

Mike Straumietis also notes that increased fertilizer costs can affect the delivery of plant nutrients. Unfortunately, it can cast a harsh shadow on future harvests, consequently delaying or impacting food production.

While developed countries can hedge against fertilizer cost issues, others may not. When these areas cannot produce enough food for their citizens, it can tremendously impact their food security.

Goal: Unlocking a Plant’s True Genetic Potential

Advanced Nutrients, following the lead of founder and CEO Mike Straumietis, has developed the first and only complete growing system that optimizes a plant’s growth through all the phases of its vegetative and bloom cycles. The goal is to unlock a plant’s genetic potential to yield good results. Growers in more than 110 countries rely on Advanced Nutrients’ next-generation products.