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Key crops, ranging from Brazilian corn to Malaysian durians, are in jeopardy as a result of limited fertiliser supplies and skyrocketing fertilizer prices, forcing farmers to cut back on vital crop nutrients, exacerbating global food security and inflation concerns.
Fertiliser prices have risen this year due to rising demand and decreased supply, as record natural gas and coal prices have prompted output cuts in the energy- intensive fertiliser sector.
This year, urea prices have increased by more than 200 percent, while diammonium phosphate (DAP) prices have nearly doubled.
With global food prices at their highest in more than a decade, rising fertiliser costs will only add to pressures on food affordability, particularly in import-dependent economies, where stretched budgets leave little room for government subsidies, according to Frederic Neumann, co head of Asian economics research at HSBC.
“At a time when COVID-19 already decimated the lives and livelihoods of untold millions, soaring food costs are hitting the poor especially hard,” he said. “This raises the risk that higher fertiliser costs will not only hit farmers but will also be passed on to consumers via higher food prices.”
Story by : Norvisi Mawunyegah