Fertiliser prices rise despite surpluses

Fertiliser prices on the domestic market have recently surged despite a surplus of supply, according to the Ministry of Agriculture and Rural Development.

In Cuu Long (Mekong Delta )Region, the price of fertiliser had increased by around 10 per cent over the start of November, affirmed Nguyen Tri Ngoc, Head of the Cultivation Department under the ministry.

In An Giang Province, a tonne of urea fertiliser now costs around VND6 million (US$330), an increase of VND800,000 ($45).

The price of this fertiliser has also risen in northern and central provinces.

Diammonium phosphate fertiliser (DAP) has also increased by between VND100,000 ($5.6) and VND200,000 ($11.2) per tonne.

Explaining this sudden hike, the Information Centre for Agriculture and Rural Development (Agroinfo) said that the exchange rate between the Vietnamese dong and the US dollar was the main reason.

According to Agroinfo, companies had had to buy US dollars on the black market, causing the price of imported fertiliser to increase by about $20 per tonne.

Moreover, seeing the price climbing, farmers bought large quantities of fertiliser to keep in reserve for the coming winter-spring crop. This had also contributed to the price increase.

However, this high price is expected to drop soon.

“With full supply in the world and domestic market, this rise will only be for a short time. It will be more sustainable in the near future,” said Truong Hong Kim, an expert from Agroinfo.

In the first 11 months of this year, Viet Nam imported 3.85 million tonnes of fertiliser worth $1.2 billion.

This figure has increased by 33.4 per cent in volume but reduced 16 per cent in value compared to the same period last year.

It includes 1.27 million tonnes of urea fertiliser, 1 million tonnes of NPK and 860,000 tonnes of DAP.

According to the ministry, the total amount of imported fertiliser is just enough to cover the demand of the autumn-winter and winter-spring crops of 2009-10.

Recently, Viet Nam has imported fertiliser from 14 markets with about 66 per cent of the volume coming from China.

VNN/VNS

Tags: Vietnam Fertilise