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FRIDAY, September 22, 2023

Fertiliser costs expected to more than double for Thai farmers

Fertiliser costs expected to more than double for Thai farmers
THURSDAY, April 07, 2022

Thai farmers’ expenditure on fertilisers is expected to go up by two to three times this year due to the sharp rise in global prices because of the Russia-Ukraine war, and the restrictions on exports by the two countries, an academic said on Thursday.

Spending on imported fertilisers this year is expected to soar to THB200 billion to THB300 billion, Att Pisalwanit, director of Thai Chamber of Commerce University's Centre for International Trade Studies, said.

The centre estimated that Thai farmers would have to spend more than THB100 billion higher than the cost in 2015 when they spent about Bt110 billion.

Experts said prices in the global fertiliser markets have shot up after both Russia and Ukraine restricted exports to reserve for domestic use since the middle of last year. The war in March aggravated the situation when Russia banned exports of fertilisers and precursor chemicals to 48 countries that joined the international boycott against Moscow.

China has also lowered the volume of exports of fertilisers, as a result the prices of urea fertiliser and di-ammonia phosphate have risen from $400 per tonne and $500 per tonne respectively to $1,200 and $1,300, a spike of about 160-200 per cent.

Fertiliser costs expected to more than double for Thai farmers Att said the situation is hurting farmers badly as the cost of fertilisers constitute 15 per cent of overall expenses of farmers.

Att said the prices of fertilisers in Thailand have increased by over 100 per cent. For example, the prices of nitrogen-based fertilisers increased from THB12,000-15,000 per tonne in 2020 to about THB30,000-35,000 per tonne this year. The price of phosphate-based fertiliser increased from THB20,000 per tonne to about THB38,000 per tonne this year and potassium-based fertilisers rose from THB9,000 per tonne last year to THB32,000 this year.

The five crops that would be affected the most by rising prices would be rice with an estimated increase in cost of THB69 billion, sugarcane with an increase in cost of THB44 billion, oil palms with an increase in cost ofTHB6 billion, rubber trees with an increase in cost of THB29,000, and corn with an increase in cost of THB18 billion.

The academic said the government should support the setting up of chemical fertiliser plants in the country by using raw material from natural gas.

Att said the Northeast of Thailand also has potash that could be used for making fertilisers.

The academic advised farmers to use less fertiliser and turn to use organic fertilisers.

The research arm of Bank of Ayutthaya predicted that the use of fertilisers would increase by 2.5 per cent to about 5.6-5.8 million tonnes per year until 2024.

Fertiliser costs expected to more than double for Thai farmers Meanwhile, Plengsak Praphaphesat, president of the Thai Fertiliser and Agricultural Supplies Association, on Thursday called on the Internal Trade Department to speed up consideration of requests of fertiliser traders to increase prices.

He said the department should also allow the traders to import more fertilisers to make sure that there would be no shortage because of rising demands.

A fertiliser trader, who asked not to be named, said he hoped the situation would improve soon because Russia has announced increase in exports of its fertilisers after several countries agreed to pay in roubles.