The Analysis of Compound Fertilizer Market in the U.S.

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Introduction of Chemical Fertilizer Industry in the US
The United states is the largest importer of fertilizer in the world, with more than half its nitrogen and over 85% of its potash coming from international sources. The usage amount of nitrogen fertilizer and phosphate fertilizer rank second only to China, while the use of potassium fertilizer is in the world’s leading position. The extensive use of compound fertilizers in the United States promotes and maintains the high development of American agricultural production. According to reports, the 3%~5% crop production is due to the use of chemical fertilizers. Anhydrous ammonia, urea and potassium chloride are among the most important fertilizers in the US in addition to compound fertilizers.

U.S. fertilizer facilities

Overview of Compound Fertilizer Market in the United States

Compound fertilizers are classified into two-element (phosphorous-potassium, nitrogen-phosphorous and nitrogen-potassium) or three-element (nitrogen-phosphorous-potassium).
Manufacturers make compound fertilizers by using basic fertilizer materials, such as ammonia (NH3), ammonium phosphate, urea, sulfur (S) and potassium (K) salts. There are many methods used for making compound fertilizers, with the specific manufacturing processes determined by the available basic components and the desired nutrient content of the finished product.
Generally, the whole compound fertilizer production process including:
raw materials batching → compound raw materials mixing → compound fertilizer granulation machinecompound fertilizer drying processcooling process compound fertilizer granules screening → coating process → packaging process

1. Advantages of compound fertilizer industry, compared with straight fertilizers (pure nutrient fertilizers)

Pure nitrogen fertilizers
Anhydrous ammonia, aqua ammonia, urea, ammonium sulfate, calcium nitrate, potassium nitrate and sodium nitrate
Pure phosphate fertilizers
Rock phosphate, superphosphate, diammonium phosphate and monoammonium phosphate
Pure potassium fertilizers
Potassium chloride, potassium sulfate, potassium hydroxide and potassium nitrate

★ Compound fertilizers, which contain N, P, and K, can often be produced by mixing straight fertilizers. Compound fertilizer has many advantages, including high nutrient content, less side effects constituents and good physical property,etc. It plays a vital important role in fertilizing evenly, raising the utilization rate of fertilizer as well as promoting high and stable yield of crops. The reasonable combination of nitrogen, phosphorus and potassium can increase the yield of rice by 40.8%, corn by 46.1%, soybean by 17.9%.

compound fertilizer

★ The total amount of compound fertilizer nutrients is generally high and it also has various kinds of nutrients, so crops can be provided by more than two kinds main nutrients at the same time through one-time fertilization. The fertilizer nutrients distribution is more uniform, after being granulated, it is with compact structure as well as stable and long fertilizer efficiency if compared with powder or crystalline straight fertilizer. Moreover, the nutrient release is uniform. It has few disadvantage on soil because of its less side effects constituents. Generally, the compound fertilizer is made of particles, because its moisture absorption is small and is difficult to agglomerate. What’s more, it is easy to store and use and is especially convenient for mechanized fertilization. As it has less side effects constituent and the active nutrient is higher than straight fertilizer, so it can save the cost of packaging and storage.
With expansion of economic crops’ planting area and increase of compound fertilization, the production growth of compound fertilizer will be higher than straight fertilizer.
2. The progress of compound fertilizer industry in the US
Compound fertilizer plays an important role in the American market. For different crops, there are different ration of compound fertilizer, which is convenient for the uniform application of mechanization. After the Second World War, the usage amount of fertilizer in the United States increased rapidly, including the compound fertilizer. However, by the end of 1970s, the compound fertilizer market tended to be stable, the annual amount changed between 2% to 3%. In recent years, the use of compound fertilizer is still increasing.
The United States has attached great importance on the compound fertilizer market, so the compound fertilizer market has a broader market space and entered the period of rapid growth. For more than ten years, especially since 1999, the domestic compound fertilizer enterprise has increased dramatically. The compound fertilizer production capacity has increased by more than 20% annually, the compound fertilizer has become one of the national key development of chemical fertilizers.

Price fluctuation of compound fertilizer in the past several years
From December 2007 to October 2008, prices for compound fertilizer jumped 90.4 percent. That period coincided with a sharp runup in many commodity prices, which affected both the prices of commercial grain crops major products that were used to manufacture compound fertilizer. However, during the latter months of 2008, the U.S. economy experienced a general reversal in price trends, including compound fertilizer. The compound fertilizer prices fell 39.8 percent from October 2008 to July 2009.
Following the summer of 2009, with a few exceptions, prices for compound fertilizer rose steadily, before the most recent peak at the start of the summer growing season in 2012. From July 2009 to June 2012, the price compound fertilizer increased 93.1 percent. The severity of the drought in 2012 caused an unanticipated decline in the demand for compound fertilizer,this leaded to large price declines. Compound fertilizer prices fell 9.5 percent from June 2012 to March 2013.

3. Present situation of compound fertilizer market in the United States

Nowadays, many countries in the world attach great importance on compound fertilizers, the United States is no exception.
The present status of compound fertilizer market in US can be described: industrial scale enlarged rapidly; overcapacity exposed and low industrial concentration emerged, the market to be regulated urgently, the competitiveness of the industry wakened from resource bottleneck. Under the support of government policy, the compound fertilizer market is still considered as the future trend.
In compound fertilizer industry, the small business accounts for a larger proportion, but these small compound fertilizer enterprises are often with obsolete production equipment, backward technology and low product quality, they do not have the market competitiveness. On the contrary, the big compound fertilizer enterprises, such as U.S.A GARSONI FERTILIZER (INTERNATIONAL) INC, account for about 40% in the North American compound fertilizer market. They usually choose the large capacity compound fertilizer production line to meet the American compound fertilizers need. In the future, with the rapid expansion of leading industry, small compound fertilizer enterprises will gradually lose market and the market share of compound fertilizer leading companies will gradually increase.

benefits of compound fertilizer

State management (support) on compound fertilizer
The U.S. Government spends $25 million or more a year on subsidies for compound fertilizer production.
The compound fertilizer management of the United States includes two parts.
One part is the government’s management of the compound fertilizer industry, mainly through legislation, law enforcement to regulate and implement.
The other part is the management of fertilizer usage. The government, university and technology promotion agencies recommend scientific fertilization technology and related standards to farmers to promote rational use of nutrients, optimize the allocation of resources and protect water resources as well as ecological environment.

4. Supply & demand of compound fertilizer in the America
Compound fertilizers have been used extensively since 1950 in the United States where they constitute more than 50 percent of all fertilizer produced. The demand for compound fertilizers is highly dependent on the grain demand in the country. The use of compound fertilizer can improve the efficiency of crop. Therefore, the demand for food promote the growth of the market. Another factor driving the growth of the compound fertilizer market is the reduction of cultivated land and government incentives. According to the statistics, there are more than 1200 compound fertilizer companies in the United States, they produce a large quantity of compound fertilizers every year to meet the great demand for compound fertilizers.

Compound fertilizer importing in the US
The US is the second leading consumer of compound fertilizers after China. The country is also one of the largest importers of the compound fertilizers in the world. In 2011, the US imports compound fertilizers exceeding 37 thousand tonnes. In the same year, the country’s exports of compound fertilizers decreased by approximately 14% year-on-year and were estimated at 87.5 thousand tonnes. Nevertheless, the US trade balance in compound fertilizers was positive in 2013. Canada, Peru and Mexico are top three suppliers of compound fertilizers for the Unites States, together accounting for over 50% of the total US imports of the compound fertilizers.

The Import and Export Amount of Compound Fertilizer of the U.S.
Import Amount(USD)
Export Amount(USD)

5. The future development of compound fertilizer in the US

Compound fertilizers play a major role in the development of plants by providing them required nutrients. The application of compound fertilizers to the crops helps in getting a higher yield. The US compound fertilizers market is estimated to grow at a CAGR(compound annual growing rate) of 20% during the forecasted period 2016-2021. The compound fertilizers market value is estimated to be USD 16.4 billion in 2021 from USD 11.3 billion in 2016. The compound fertilizers market in the United States is expected to grow at a lower rate owing to market saturation.
The main constraint on growth is government regulation in the fertilizer industry. Other limiting factors are the volatility of prices and the increasing environmental and health problems of the use of chemical fertilizers. How to improve the utilization rate of fertilizer and reduce the pollution caused by compound fertilizer is the key point of the fertilizer research of the United States in the future.
The United States Department of agriculture and the state’s agricultural extension departments should propose the best management methods according to the characteristics of different regions. According to fertilizer experts, the best management method is a comprehensive system which involves every aspects of agriculture production.The aim of this method is to obtain the best yield, improve crop quality and the utilization rate of fertilizer as well as reduce investment loss and pollution of the environment.

Extension Reading:
1.Compound fertilizer granulation method and process
2.Analysis on India chemical fertilizer market

2018-10-23T16:14:11+00:00 Market Analysis|

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