This expected price increase in 2022 is due, according to Fitch, to OCP’s policy of limiting exports to maintain its price level. OCP’s policy is all the more effective since the group controls more than 70% of the world’s natural phosphate reserves found in Morocco, adds Fitch.
Conversely, in 2023, it forecasts a fall in the price of phosphate rock of Moroccan origin. This year, prices could average $160 per ton, compared to $150 per ton in previous forecasts.
Ammonia and potash prices
While Fitch forecasts a rise in all fertilizer products, the price outlook for ammonia, a key element in fertilizer production, has mostly exploded from an average of $850 per ton at the end of 2022 to $1,000. the ton.
Separately, ammonia prices are expected to reach new highs amid high gas prices, as well as an expected recovery in demand in 2023 as supply constraints persist, Fitch said, expecting also ensure that global fertilizer demand exceeds 2022 levels in 2023, and that prices remain high until 2026.
“Demand in 2023 will increase from 2022 levels, but will not return to pre-war levels in the United States and Europe…”, specifies the same source. Finally, Fitch forecasts a continued rise in the price of potash on the world market in 2022. “The fundamentals of the market remain unchanged… The market has an oligopolistic structure, with Canada, Russia and Belarus historically representing more than 70% of its supply.
Russian product continues to make its way into the market, with Brazil and India absorbing most of the product, although export volumes this year are down 10-15% from 2021. Belarusian product is exported by rail via Russia, China, Turkey and possibly Iran, where it is then re-exported,” Fitch said.