27 Dec 2023 17:27

Russia could increase fertilizer production 10% in 2024, boost exports - association

MOSCOW. Dec 27 (Interfax) - Russian mineral fertilizer production and exports this year could recover to their 2021 levels, said Andrei Guryev, head of the Russian Fertilizers Producers Association.

"According to preliminary data, Russian mineral fertilizer production rose 9% year-on-year in 11M 2023 to 53 million tonnes. We expect to reach 2021 levels or 59 million tonnes by the end of the year provided that the current capacity utilization is maintained. We also expect exports this year to recover to the 2021 level," the RFPA press office quoted Guryev as saying.

If capacity utilization is sustained, fertilizer production might rise 10% in 2024 to more than 64 million tonnes and exports to the 2021 level, Guryev said.

Russia produced 58.6 million tonnes and exported 37.5 million tonnes of fertilizer in 2021. Fertilizer production fell more than 7% to 54.3 million tonnes and exports fell 15% in 2022.

According to Guryev, in 2022, the volume of Russian fertilizer exports to unfriendly countries decreased by a quarter (in absolute terms - by 3 million tonnes to 10 million tonnes), and in 2023 may decrease by another 15%-20%. The share of friendly countries in the structure of Russian fertilizer exports in 2023 is expected to grow to 75% compared with 70% a year earlier.

"New priority export destinations for Russian fertilizer producers are the countries of the global South, where three quarters of all exports are already being delivered. The largest markets at the moment are India and Brazil," the association head noted. According to him, Russian fertilizer shipments to Brazil grew by 1 million tonnes (or 16%) to 6.3 million tonnes in volume terms in 10M 2023.

Guryev reiterated that he believes it is necessary to abandon quotas for Russian fertilizer exports. "Fertilizer producers continue to be subject to export quotas, under which an exporter must obtain a new export license for each transaction. In order to reestablish the effectiveness of export controls, we believe that regulators should abandon setting quantitative restrictions on fertilizer exports and issuing one-off licenses under export non-duty quotas in favor of a permissive procedure for fertilizer exports (by issuing a general license for fertilizer exports)," he said.

Guryev stressed that the needs of the Russian agricultural sector's in fertilizers for this year were fully covered by mid-November, after which deliveries for next year's spring sowing began. By December 20, the volume of fertilizers purchased by Russian farmers, given resources accumulated at the beginning of the year, increased by 5% year-on-year to 5.8 million tonnes in active ingredient.