Author Argus

Fertilizer purchases are on the sidelines in the Argentinian market because of the country’s political scenario. In Paraguay unfavorable weather conditions because of the El Nino phenomenon cause lower liquidity, while Paraguayan buyers struggle to find trucks available to carry fertilizers from Brazil.


Join Camila Dias, Argus Brazil Bureau Chief, and Renata Cardarelli, deputy editor for the Argus Brazil Grains and Fertilizer publication, as they talk about the South American fertilizer market at the beginning of 2024 and the main reasons that cause low liquidity in this market.


CD: Hello and welcome to ‘Market Talks’- a series of podcasts presented by Argus addressing the events impacting commodities and the energy sector in Brazil and around the world. My name is Camila Dias, Argus Brazil Country Manager. In today's episode, I will talk to Renata Cardarelli, deputy editor for the Argus Brazil Grains and Fertilizer publication, about the South American fertilizer market. Hi Renata, welcome.

RC: Hello, Camila, it is always a pleasure to be here.

CD: Renata, how is Paraguay’s fertilizer market at the beginning of 2024?

RC: Camila, the year started at a slow pace in the Paraguayan fertilizer market. The price of ammonium sulfate increased in the import market amid the narrowing of the import window for application in corn and wheat crops. Demand for nitrogen should continue to be more intense until February, with delivery in March. AS prices are at around $260-270/t cfr Paraguay. For future shipments, the nitrogen is indicated at lower levels, at around $245-250/t cfr Paraguay. The country imported around 16,150t of AS in 2023, down by 10pc from 2022.

CD: Why did the Paraguayan market start the year at a slow pace, Renata?

RC: Many farmers are focused on field works, especially on monitoring the soybean harvest. Paraguay's soybean harvest has been affected by unfavorable weather conditions, especially because of a drier than usual weather - as was seen in some producing regions in Brazil - because of the El Niño climate phenomenon. Farmers have already started harvesting the soybean crop in the country, but the work is still in its beginning and, according to local market participants, accounts for less than 5pc of the planted area. Producing regions in the central and southern portions of the country are expected to receive more irregular rains in the first half of February. As a result, the soybean harvest can benefit. However, the lack of rain can harm the development of crops – especially the late-cycle crops – because of higher temperature and dry weather. In this context, farmers are still evaluating whether they should plant corn, as is usually the case, or whether they should plant soybeans on top of soybeans.

CD: Interesting, Renata, and how is Paraguay’s fertilizer market preparing itself for the 2024-25 soybean crop?

RC: Fertilizer purchases for the 2024-25 soybean crop – which starts in September – are at a slow pace in the Paraguayan domestic market. Market participants operating locally report that one-off volumes were purchased, mainly of specialties. MAP 11-52 price is firm at $635-640/t cfr and potash is at $390-400/t cfr, amid reduced liquidity.

CD: The Southern Cone markets are very interconnected because of the trade flow dynamics. Other markets asides from Paraguay’s also experienced low liquidity. How is the pace of fertilizer purchases in Uruguay and Argentina, Renata?

RC: It's true, Camila. In the Argentinian market, low liquidity also prevails. There is one-off demand for phosphates with loading in February and price references for MAP/DAP range at around $583-592/t cfr Argentina, with no deals reported. There are also indications that an important buyer in the Argentinian market is looking for volumes of urea for replacement and arrival in March-April. President Javier Milei signed a resolution at the end of December eliminating and replacing the Argentina Republic's Import system – known as Sira. It generated many difficulties in 2023, especially in accessing the US dollar and, consequently, paying suppliers. In Uruguay, the expectation is that inquiries for phosphates will begin to intensify. Historically, Uruguay has depended on fertilizer vessels that first land in Argentina and are then sent to Uruguay. Paraguay is a landlocked country, where buyers usually arbitrate between the prices charged in Argentina and Brazil to close fertilizer deals. Paraguayan buyers have difficulty finding available trucks to transport fertilizers from Brazil to meet their last-minute needs, while in Brazil trucks are busy transporting grains to export corridors and fertilizers to corn producers.

CD: You mentioned arbitrage in the Paraguayan fertilizer market. In this context, logistics cost in Brazil are important for decision-making. Argus monitors 31 fertilizer freight routes, what are some trends that you’d highlight?

RC: Fertilizer freight costs on routes departing from São Luís, at the port of Itaqui, are rising amid the reduced supply of trucks in the region. With the harvest intensifying and demand increasing in Mato Grosso and other states in the Central-Western region, many drivers prefer to travel to look for more attractive freight rates in these locations. Therefore, there is a lack of vehicles in Maranhão, which contributes to the increase in fertilizer freight. The Northern Arc has been increasing its relevance in the export corridors of Brazilian agricultural production. In 2023, Northern Arc ports accounted for around 34pc of Brazil's soybean exports, compared to 30pc of the port of Santos and 14pc from Paranagua. As for corn, the Northern Arc accounted for 42pc of exports, compared with 38pc from Santos and 8pc from Paranagua.

CD: Brazilian drivers are currently more focused on export corridors for the transport of agricultural production. Is there a lack of trucks to transport fertilizers or does low liquidity prevail?

RC: The smallest supply of trucks for fertilizers currently is precisely in Maranhao state, Camila. In Southern and Southeastern ports, fertilizer freight rates have even declined because of the high supply of trucks. But low liquidity prevails in the Brazilian fertilizer market. Demand for nitrogen should have intensified for the winter corn crop, but demand did not increase as expected. Market participants operating in Parana state, for example, estimate that around 15pc to 20pc of fertilizer needs for the corn crop have not yet been purchased, but some believe purchases will total only 5pc of needs, indicating there could be a reduction in the use of fertilizers.

CD: Thank you very much, Renata. This and other episodes of our podcast are available on the Argus website at Visit the page to follow the events that affect global commodity markets and understand their developments in Brazil and in Latin America. We'll be back soon with another edition of “Market Talks”. See you soon!