New Zealand’s two largest suppliers of fertiliser, Ravensdown and Ballance, have increased their prices this week. For Ballance this is their fifth increase since the start of 2021.

In an email notification to their customer-shareholders, Ballance stated that the cost of urea production is increasing significantly on the back of sharply rising energy costs. In the last three months, the import price has increased by close to USD200/T.

In addition to energy costs, high global demand for arable crops has squeezed the global supply of nutrients, resulting in pricing volatility that is expected to continue over the coming months.

Both Ballance and Ravensdown have increased the price of their key nitrogen products by NZD100/T.

This means that for farmers currently in the midst of sowing crops such as maize or fertilising pasture for spring, the cost of replacing the nitrogen being removed in the form of plant or animal protein has climbed significantly this year. While farmers in NZ are price-takers, global supply restrictions have also resulted in higher prices generally for dairy, meat and staple plant proteins.

NZ consumers can expect all of these to flow through to higher prices for food in general.