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Two Fertilizer Companies Now Worth More than Citigroup

Discussions about the economic and financial ramifications of PEAK OIL

Fertiliser at a price – if you can get it

Unread postby Andrew_S » Sun 02 Dec 2007, 13:49:39

Fertiliser supply problems.
$this->bbcode_second_pass_quote('', 'N')ews | 28 November, 2007
By Howard Walsh

A LOGISTICAL supply problem with fertilisers in spring 2008 is now a reality not a possibility, say fertiliser companies.

World demand is outstripping supply and farmers are being advised not only to make sure they have ordered what they need, but to take delivery and make sure they have it.

"This coming season, the most likely situation is a shortage,” said Yara’s England and Wales business manager Steven Chisholm.

World demand for grain production for both feed and biofuel was currently outstripping supply and that was driving the demand for fertilisers.

"All I would say is order it and get it delivered – ownership will be nine tenths of the law this spring.”
<snip>
"India still need to buy more tonnes for December and with time and product running out fast in China expect this bull run to continue well in to 2008,” said a spokesman.


Full article:farmersguardian.com
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Interesting juxtaposition here at peakoil.com!!

Unread postby Dvanharn » Sun 02 Dec 2007, 17:19:37

The article you refer to talks about shortages of fertilizer in the global market, with shiploads even being diverted to "more lucrative" destinations.

The next news item is an article from the NY Times on the Malawi's turnaround in food production:

$this->bbcode_second_pass_quote('', 'F')armers explain Malawi’s extraordinary turnaround — one with broad implications for hunger-fighting methods across Africa — with one word: fertilizer.


$this->bbcode_second_pass_quote('', 'M')alawi’s soil, like that across sub-Saharan Africa, is gravely depleted, and many, if not most, of its farmers are too poor to afford fertilizer at market prices.


Malawi's fertilizer is subsidized, the nation is poor, and I expect that this "turnaround" will be short-lived as increased demand and short supplies drive the price of fertilizers up.

Sad but true!

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Re: Fertiliser at a price – if you can get it

Unread postby Ludi » Sun 02 Dec 2007, 18:07:34

You can build bat houses and collect the guano.

Bat Houses
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Re: Fertiliser at a price – if you can get it

Unread postby Andrew_S » Sun 02 Dec 2007, 18:24:04

Thanks for the phosphorus info.

wisconsin_cur has posted a thread about extra fertilizer use in Malawi relieving famine this year:
http://www.peakoil.com/fortopic34469.html
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Re: Fertiliser at a price – if you can get it

Unread postby Chesire » Sun 02 Dec 2007, 20:08:53

Well the US wants energy and the world wants food. Guess who wins if we have a 90 day mexican stand off over fertlizer .
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Re: Fertiliser at a price – if you can get it

Unread postby Windmills » Sun 02 Dec 2007, 20:15:08

Doesn't the Haber-Bosch process require natural gas in order to be produced economically, or at least relatively inexpensively? If electrolysis of water to get hydrogen is required, that is going to drive up the price and the end effect will be same. It won't matter if it's a material shortage or scarcity produced because of high prices, people are going to suffer along with their agricultural systems when nitrogen fertilizer becomes more difficult to obtain. It'll be one of several blows to the "green" revolution.
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Re: Fertiliser at a price – if you can get it

Unread postby JohnDenver » Sun 02 Dec 2007, 20:47:17

$this->bbcode_second_pass_quote('pstarr', 'N')itrogen can always be extracted from the air using the Haber-Bosch process but phosphate fertilizers only come from the earth and those stocks are limited. The world's known supplies of phosphate are peaking.


According to the Energy Bulletin article you are citing, phosphate rock production peaked in 1989 -- 20 years ago.

World population in 1989 was 5.2 billion. Current world population is 6.6 billion.

That pretty much sums up how "scary" peak phosphorus is.
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Re: Fertiliser at a price – if you can get it

Unread postby frankthetank » Sun 02 Dec 2007, 21:52:34

Maybe they should be bottling the water that flows through New Orleans and resell it to farmers up north?

$this->bbcode_second_pass_quote('', 'T')he dead zone is caused by nutrient enrichment from the Mississippi River, particularly nitrogen and phosphorous. Watersheds within the Mississippi River Basin drain much of the United States, from Montana to Pennsylvania and extending southward along the Mississippi River. Most of the nitrogen input comes from major farming states in the Mississippi River Valley, including Minnesota, Iowa, Illinois, Wisconsin, Missouri, Tennessee, Arkansas, Mississippi, and Louisiana. Nitrogen and phosphorous enter the river through upstream runoff of fertilizers, soil erosion, animal wastes, and sewage.
lawns should be outlawed.
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Re: Fertiliser at a price – if you can get it

Unread postby JohnDenver » Sun 02 Dec 2007, 21:53:42

$this->bbcode_second_pass_quote('Windmills', 'D')oesn't the Haber-Bosch process require natural gas in order to be produced economically, or at least relatively inexpensively?

China is the largest producer of nitrogen fertilizer in the world:
Image
Source

And:
"60% of China's nitrogen fertilizer production is currently based on coal."
Source

Economics clearly aren't a problem. Coal is far cheaper per btu than NG. Peak oil is a complete non-issue for nitrogen fertilizer.

But hey... Keep swinging guys. Maybe one of these days you might actually hit the ball.
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Re: Fertiliser at a price – if you can get it

Unread postby JohnDenver » Sun 02 Dec 2007, 22:05:15

$this->bbcode_second_pass_quote('pstarr', 'I')t's actually very scary JD. Much phosphorus is locked up in agriculture topsoil and woody material. As drought and abuse aggravate soil erosion the stuff we put into the land is increasingly washing into the oceans. Such is the nature of the eutrophication that has damaged most inland and coastal waters.

Phosphorus was returned from the oceans to land via bird guanos and salmon runs. These have both been wiped out.

no phosphorus no quorn (tm) :twisted:


There is no shortage of phosphorus, as clearly demonstrated by the growing human population.

Even if there were a shortage of phosphorus, it wouldn't matter because vast quantities of phosphorus are being "produced" every day in the form of feces, urine, corpses and bones etc. What's the big deal? Bring on the "night soil"! I love it! It's all part of learning how to live in a sealed interplanetary spacecraft.
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Re: Fertiliser at a price – if you can get it

Unread postby frankthetank » Sun 02 Dec 2007, 22:08:41

JD-

Didn't the biosphere project show that might not work very smoothly :)
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Re: Fertiliser at a price – if you can get it

Unread postby JohnDenver » Sun 02 Dec 2007, 22:12:36

BTW, here's the production stats for phosphate rock from the IFA (units: 1000 tonnes):

1999: 146 349
2000: 146 388
2001: 144 068
2002: 154 529
2003: 157 056
2004: 165 325
2005: 172 126
2006: 167 600

Hardly a picture of terminal decline.
Source
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Re: Fertiliser at a price – if you can get it

Unread postby cube » Sun 02 Dec 2007, 22:16:47

$this->bbcode_second_pass_quote('JohnDenver', '.')..
China is the largest producer of nitrogen fertilizer in the world:
Image
Source

And:
"60% of China's nitrogen fertilizer production is currently based on coal."
Source

Economics clearly aren't a problem. Coal is far cheaper per btu than NG. Peak oil is a complete non-issue for nitrogen fertilizer.

But hey... Keep swinging guys. Maybe one of these days you might actually hit the ball.
I think there's a consensus here JohnDenver that phosphorus NOT nitrogen fertilizer is the weak link.

There are several "bullets" being shot at humanity right now: PO, global warming, peak phosphorus, etc... Dodging 1 bullet doesn't make you safe. There's a lot more to come!
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Re: Fertiliser at a price – if you can get it

Unread postby Pops » Sun 02 Dec 2007, 22:46:36

But wait, if N can be made from air why is it so expensive and the main input cost for corn and most any other crop aside from fuel and seed?

And one other question; if most P is Locked up in ag topsoil I wonder where else it might better be?

Should not the question be about the amendments needed to UnLock it?
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Re: Fertiliser at a price – if you can get it

Unread postby Andrew_S » Sun 02 Dec 2007, 23:18:20

$this->bbcode_second_pass_quote('Pops', 'B')ut wait, if N can be made from air why is it so expensive and the main input cost for corn and most any other crop aside from fuel and seed?
The cost is mainly energy to make N gas react with hydrogen.
$this->bbcode_second_pass_quote('', 'T')he Haber process now produces 100 million tons of nitrogen fertilizer per year, mostly in the form of anhydrous ammonia, ammonium nitrate, and urea. 0.75% of the world's annual energy supply is consumed in the Haber process (3.35% of world natural gas production is used for ammonia production[8][9][1], and natural gas represents 22% of world energy production. [10] See also [11] for rough estimate of 1% of energy production.) That fertilizer is responsible for sustaining one-third of the Earth's population, as well as various deleterious environmental consequences. [12] Generation of hydrogen using electrolysis of water, using renewable energy, is not currently competitive cost-wise with hydrogen from fossil fuels, such as natural gas, and is responsible for only 4% of current hydrogen production. Notably, the rise of this industrial process lead to the "Nitrate Crisis" in Chile, when the British industrials left the country (since the natural nitrate mines were no longer profitable), closing the mines and leaving a large unemployed Chilean population behind.

Link:Wikipedia Haber process
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Re: Fertiliser at a price – if you can get it

Unread postby Pops » Sun 02 Dec 2007, 23:36:08

Sorry A.S. I was pointing out (simply) if there were a cheaper way to make N then someone would surely be making a killing doing it.

The most crucial input to the most crucial ag input of course is the cost of energy.

Like all in else.

Sorry.
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Re: Fertiliser at a price – if you can get it

Unread postby JohnDenver » Mon 03 Dec 2007, 00:57:16

$this->bbcode_second_pass_quote('frankthetank', 'J')D-

Didn't the biosphere project show that might not work very smoothly :)


I'm not sure what you mean by "that". If you mean "night soil", then the 4000 year Chinese civilization project showed that it worked splendidly.
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Re: Fertiliser at a price – if you can get it

Unread postby cube » Mon 03 Dec 2007, 02:06:51

$this->bbcode_second_pass_quote('JohnDenver', 'B')TW, here's the production stats for phosphate rock from the IFA (units: 1000 tonnes):

1999: 146 349
2000: 146 388
2001: 144 068
2002: 154 529
2003: 157 056
2004: 165 325
2005: 172 126
2006: 167 600

Hardly a picture of terminal decline.
Source
FUNNY

my sources says otherwise:
$this->bbcode_second_pass_quote('', 'T')he production of phosphate rock peaked in 1988 at a level of 166 million tonnes product, falling to 125 million tonnes today.


We're both quoting from the same website www.fertilizer.org
You want to explain that JohnDenver? :-D
btw I never was able to get access to your stats..I guess you have to be a member to access the info.
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