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Overiew
Global &
Global &
Pakistan
Global
Outlook
• Factors impacting agriculture and
fertilizer demand
– Oil price
– Weather
– Biotech Developments
– Agricultural Commodities
• Production, Stock and Prices
– Price and Other Factors
– Fertilizer use by Crops
• Supply/Demand situation
References
• International
– International Fertilizer Industry Association IFA
– International Center of Agriculture for Dry Areas ICARDA
– Yara InternationalYara
– The FMB Group, UK FMB
– Fertecon Phosphate Report FERTECON
• Pakistan
– National Fertilizer Development Center NFDC
– Soil Fertility Institute Lahore Soil Fertility
– Fertilizer Industry of Pakistan Industry
– Average price from Commodity Markets Market Price
Biotech
Developments
Main breakthrough
Global GM Crops Area (Mha) Sequencing of maize genome
Main anticipated developments in
next five years
Release of GM rice in China and
India
Release of drought tolerant crops
Status of N use efficiency trait?
Source: James
Could be released by 2015
Mostly:
USA, Argentina, Brazil, Canada, India, Recent partnerships:
China - Monsanto/Evogene
Soybean, maize, cotton, rapeseed - Pioneer/Arcadia
Herbicide tolerance, insect resistance
GM Crops consume 50 – 100% more fertilizers IFA
World Cereal
Production
IFA
World Cereal
Production
- 2.9%
509 Mt 924 Mt
- 5.4%
136 Mt
+17% +37%
128 Mt 25 Mt
IFA
World Cereal
Production
+13%
478 Mt 932 Mt
+8.3%
147 Mt
+0.7% +78%
132 Mt 41 Mt
IFA
World Cereals Stocks
IFA
Agri Commodity Price
Very high
Soya Wheat prices
Corn Wheat
130%
Soybean
87%
Maize
31
%
Rice
Palm oil
Milk
Price Increase Mar 07 – Mar 08
Declining but
still
high prices
Low but increasing Sugar
prices
Cotton
Meat
IFA
World Fertilizer Use
(%)
IFA
Price Factors
Product Price
Commodity Price
Raw Material
Supply & Dist Cost
Supply Demand
World Fertilizer
Consumption
45 Years Historical Trend
Million Tons
IFA
World Fertilizer
Consumption
Short Term
IFA
World Fertilizer Outlook
Long Term
175 194
154
IFA
World Fertilizer
Demand
IFA
Global
Conclusion
• Fertilizer use continue to increase
+ Positive Factors
• Population pressure and Food needs
• Change in cropping system
• Increase in GM crops area
• Supporting Commodity prices
– Negative Factors
• Increasing prices – Oil, Raw material, Products
• Shortage of irrigation water availability
• Estimated growth pattern (CAGR)
– Nitrogen 2.8%, Phosphate 2.9%, Potash 2.4%
Pakistan
• Land
– Geographical Area 79 million ha
– Area under cultivation 23 million ha (29%)
• Irrigation water availability (million acre feet)
– 1994 132
– 2004 136
– 2014 142 MAF (Dams : Satpara, Gomazam, 2 in Sindh)
• Population (million)
– 1994 132
– 2004 152 (2% CAGR)
– 2014 197 (3% CAGR)
Pakistan
• Food security of increasing Population
– Horizontal expansion : Limited options
– Vertical growth : Unlimited options
• Farm land distribution
– Farm size breakup
– Farming efficiency and attributes
• Fertilizer use by crops
– Current crops and cropping system
– High yielding crops
– Genetically modified crops
Pakistan
• Factors impacting agriculture
and fertilizer demand
– Weather
– Irrigation water availability
– Soil : Health and Reaction
– Agricultural Commodities
• Production, Stock and Prices
– Fertilizer use by Crops
– Bio-tech Development
– Fertilizer consumption pattern
• Supply/Demand situation
Soil Health
250
Soil P & K depleted due to
lower use
Future crop yields depends
on balanced fertilizer input
215 Increased use of P & K is
critical
NFDC
Soil Reaction
0 7 14
Acidic Neutral Alkaline
Pakistani Soils
pH range
7.5 – 9.0
Mostly
8.0 – 8.5
Low availability
P, Fe, Mg,
Bo, Co, Zn
Pakistan Commodity
Price
Mai
Market Price
Whe
ze
at
F
88%
C Rice Rice
S Flower
76%
Cotton
67%
55%
50%
34
%
Area
(%)
NFDC
Genetically Modified
Crops
Consume 50 -100 %
More fertilizers
Tons per Hectare
Source : NARC
2000
Correlation
P Use and Wheat Production
NFDC
N Use Efficiency
IFA
Pakistan Fertilizer
Consumption
28 Years Historical Trend
Thousand Tons
NFDC
Pakistan Fertilizer
Outlook
FFC 2,438
Engro 850
DHL 450
PAFL 350
PFL 100
PCF 100
Pakistan
Conclusion
• Fertilizer use continue to increase
+ Positive Factors
• Increasing population pressure and Food needs
• New varieties – high yield, high fertilizer need
• Increase in area of BT Cotton and other GM crops
• Supporting Commodity prices
– Negative Factors
• High prices of P and K
• Shortage of irrigation water availability
• Estimated growth pattern (CAGR)
– Nitrogen 2.5%, Phosphate 3.0%