In 2021, #Russia exported almost 20% of global #fertilizer supplies.
In addition to proposed sanctions, Russia urged domestic fertilizer producers to reduce exports .
“Natural gas is also a major input for making nitrogen fertilizer.”
Natural #gas markets will continue to experience higher volatility as #Europe continues to reduce its reliance on Russian #energy supplies.
Drought in Brazil
The war in #Ukraine and #drought in #Brazil significantly increased demand for US crops. The costs to ship #grains and #soybeans on the Mississippi River have reached an eight-year high.
For more details, please read Fertilizer Prices Hit New Highs, as Russian Invasion “Exacerbating a Food Shortage”.
Formula for inflation = higher fertilizer prices + higher prices for crops + higher transportation costs + the majority of prices increases passed to the consumer.
In the US, consumer spending represents nearly 70% of GDP.