Phosphorus is one of the three main macronutrients required in agriculture, along with nitrogen and potassium. Plants absorb phosphorus as phosphate where it is a critical raw material for plant cells, where it plays a role in energy storage and transfer, photosynthesis, respiration and cell division. Over 200 million tonnes of the key raw material, phosphate rock, are produced each year, producing over 150 million tonnes of finished fertilizers for global farmers.
Key facts about the phosphates fertilizer market
- Over 200 million tonnes of phosphate rock is mined every year, but only 30 million tonnes is traded internationally, with the balance processed at source into either phosphoric acid (the key phosphate intermediate) or finished fertilizers.
- The phosphate industry is resource-based, expanding especially in the Middle East, North Africa and Russia where there are good-quality, commercially attractive resources. Morocco alone has over 50% of proven global reserves of phosphate.
- The key phosphates sold are the ammoniated phosphates of diammonium phosphate (DAP) and monoammonium phosphate (MAP). These products account for 38% of all finished product sold, and 60% of the total phosphate molecules used by farmers.
- Phosphate fertilizers are traded on a spot pricing basis, but the key raw materials, e.g. phosphate rock and phosphoric acid, are frequently sold on a contract basis, based on market price formulae.
- Recent investment into integrated low-cost capacity has put pressure on market prices since 2018, with key benchmark fob prices for DAP reducing from above $435 per tonne to below $280 per tonne