Changes in fertilizer use efficiency are likely to become one of the main drivers of future fertilizer demand. They will impact the global fertilizer supply and demand balance, leading to a shift in the geography of key consuming countries and regions. This is one of the major findings of Integer and LMC's latest fertilizer study Global Fertilizer Demand: The Long-term Outlook.
"Nitrogen, Phosphate and Potash fertilizer application is characterised by notable under and over application, of nutrients, neither of which is sustainable in the long term", says Oliver Hatfield, Director of fertilizer at Integer. "A move towards more efficient fertilizer use will mean an adjustment of application rates and will lead to a redistribution of fertilizer demand geographically."
On the one hand there are currently several countries which strongly over apply nutrients. Nitrogen (N) is particularly over applied. China's N application rate is an average of 169 kg/ha compared to 89 kg/ha in EU27. The difference can partly be explained by differences in crop mix, but the biggest factor is application efficiency. We find a similar picture in India, Pakistan and Indonesia, which all tend to over apply. Subsidies can explain this over application in some cases.
On the other hand, Latin America, sub-Saharan Africa and Russia, are strongly under applying fertilizer. Russia for instance applies an average of just 33 kg/ha N fertilizer. "Over time these disparities are likely to be corrected as the need to reduce waste and negative environmental impact become more influential where there is over-application, and a need to raise crop yields heightens in countries under applying" says Oliver Hatfield.
Use efficiency will also influence the balance between the nutrients. Whereas N represented much of the growth in fertilizer demand over the past two decades, we forecast that N demand will represent only about one fifth of global total fertilizer demand change between 2010 and 2030.
Phosphate (P) and Potash (K) demand on the other hand will account for an increasing share of total fertilizer demand growth to 2030. P is equally over applied in some regions such as India and China and application growth in these regions is likely to moderate. This will be balanced by a significant rise in P demand in Latin America. Increase in K demand represents the biggest change. K is under applied across most regions and is projected to rise by more than double the growth rate of N over the period 2010 to 2030.