Concern for farmers facing volatile fertiliser pricing

Green for go: The Alexandra Athletic squad.
Green for go: The Alexandra Athletic squad.
Competition has forced fertiliser co-operatives to move from six-monthly to quarterly pricing, but one company is worried farmers may lose out.

Volatile fertiliser pricing has seen Ballance and Ravensdown both adopt quarterly price reviews, but Ravensdown chief executive Rodney Green said the timing of the price reviews could mean farmers missed out or were advantaged depending on when they ordered their product.

Fertiliser prices rose sharply this month with superphosphate nudging $500 a tonne and companies warning prices were likely to rise again in the future.

Mr Green said prices would be reviewed again in September or October, a busy time of year for farmers buying and applying fertiliser, and he was concerned the timing of orders could advantage or disadvantage farmers depending on what happened to prices.

Ballance recently announced it was moving to quarterly pricing and Mr Green said Ravensdown had to follow suit, but he wanted to hear shareholders' views on the change.

This was a shift from the traditional co-operative principle where all shareholders were treated as equally as possible.

"It was a zero-sum game for farmers," he said.

"This way some farmers win and some farmers lose."

Such was the volatility of fertiliser pricing, Australian companies were pricing and selling by the shipload.

It was likely New Zealand prices would rise in the future as companies exhausted stock and bought new product at higher prices.

"Everything we sell would be substantially lower than anywhere else."

For example, Israel was exporting superphosphate for more the $US500 ($NZ659.8) a tonne, while it was being sold in New Zealand for below $US500 a tonne.

 

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