In its recently-released Semi-annual Fertiliser Outlook, the bank’s RaboResearch division said affordability of agricultural fertiliser globally was clearly beginning to decline.
With agricultural commodity prices having largely remained stable since the start of the year, the decline in affordability was primarily due to an increase in global fertiliser prices.
Between April 2025 and the end of September 2025, fertiliser prices increased by about 15%, RaboResearch said. Phosphates increased almost 19% in the period.
While some regions of the world continued to show resilience when it came to fertiliser demand, the broader trend pointed to weakening demand in 2025, and a more pronounced downturn in 2026.
RaboResearch analyst Paul Joules said with the 12-month moving average of the affordability index going deeper into negative territory, this confirms the start of a new downcycle in the global fertiliser market.
This phase closely resembles the previous contraction, suggesting the market is entering a prolonged period of reduced consumption, he said.
Global outlook Urea consumption was forecast to decline in 2026, the report says, following a sharp price increase that had already triggered demand contraction, particularly in Brazil where farmers were shifting to ammonium sulphate.
Phosphate prices remained high, leading to an expected 4% drop in global consumption in 2025, with further declines anticipated in 2026.
Chinese exports had fallen, while shipments from Morocco and Saudi Arabia had increased. However, overall trade volumes remained subdued.
Potash demand, which rebounded in 2024 due to lower prices, was likely to slow again in 2025 as prices rise. Brazil’s plans for record imports might partially offset declines elsewhere, but, if elevated prices persisted, global demand was expected to fall in 2026, the report says.
For New Zealand, farmers continued to face persistent inflation in prices of farm inputs, including fertilisers. However, looking forward, signs of cooling global demand alongside projected New Zealand dollar strength over the next 12 months, could help to ease prices, Mr Joules said. — Allied Media
