The Global Market For Liquid Fertilizer Is Being Driven By The Growing Demand For High Crop Yields.
Author : Leena Shedmake | Published On : 16 May 2024
The market for liquid fertilizers is made up of fertilizers that are soluble and easily absorbed by plants. Crops receive a quick and effective delivery of nutrients from liquid fertilizers. They can be administered with a foliar spray or by drip and are readily diluted with water. As a result, plants absorb nutrients more efficiently than they would with traditional solid fertilizers. Liquid fertilizers help boost crop growth and production. The growing population has increased the demand for food, which is fueling the adoption of high-yielding farming practices. This is expected to drive the growth of the liquid fertilizer market.
The Global liquid fertilizer market is estimated to be valued at US$ 33.16 Bn in 2024 and is expected to exhibit a CAGR of 5.9% over the forecast period 2024 to 2031.
Key Takeaways
Key players operating in the Liquid Fertilizer Market Size are Yara International ASA, Nutrien Ltd, Israel Chemical Ltd., Haifa Chemical Ltd, GrupaAzoty, The Mosaic Company, SociedadQuímica y Minera de Chile S.A., K+S Aktiengesellschaft, Plant Food Company Inc., EuroChem Group, Annadata Organic, AgroLiquid, Agrobio Chemicals, Van Iperen International, BMS Micro-Nutrients NV, ICL Fertilizers, IFFCO, Nortox, Safsulfur, and SQM.
The growing demand for high-value crops and emphasis on improving agricultural productivity and yield is expected to drive the growth of the liquid fertilizer market. Rapid urbanization has reduced the availability of cultivable land per capita, necessitating adoption of high-yielding varieties and innovative fertilization practices. Liquid fertilizers help address the issue of exact and efficient delivery of nutrients through fertigation and foliar application.
Major players in the liquid fertilizer market are focusing on expanding their global footprint by establishing production facilities across major agricultural regions. Companies are investing in research and development to develop hybrid liquid fertilizer formulations tailored to address the specific nutrient needs of various crops. Strategic acquisitions and partnerships allow companies to broaden their product portfolios and strengthen distribution networks in international markets.
Market drivers
One of the key drivers of the liquid fertilizer market is the growing demand for high crop yield. With exponential rise in global population, there is increasing pressure on farmers to produce more food without expanding cultivated land area. Liquid fertilizers with their inherent advantages of speedy nutrient supply help boost crop growth and improve yields significantly compared to conventional fertilizers. This factor is expected to continue driving market growth over the forecast period. Other major drivers include supportive government initiatives and subsidies promoting adoption of innovative farming techniques and balanced fertilization practices.
Impact of current geopolitical situation on Liquid Fertilizer Market growth
The global liquid fertilizer market is witnessing several geopolitical challenges that can impact its growth in the coming years. The ongoing Russia-Ukraine conflict has severely disrupted the supply of key fertilizer components like nitrogen, phosphate, and potash. Both Russia and Ukraine are major exporters of fertilizer raw materials. However, sanctions on Russia and damage to infrastructure in Ukraine have led to supply chain disruptions. This is pushing up input costs for liquid fertilizer producers globally. At the same time, Western sanctions on Belarus have cut off another important supplier from the market.
Another key challenge is rising geo-political tensions between major economies. Escalating trade wars between the US and China threaten to split the global marketplace into opposing camps. This 'deglobalization' trend may reduce cross-border cooperation and collaboration in the fertilizer industry. It also heightens policy uncertainties. Emerging protectionist policies by nations can affect the movement and pricing of fertilizers internationally. Energy security issues pose yet another risk. Many regions have become overly dependent on a few fuel exporters for their fertilizer needs. Supply disruptions due to conflicts or economic/political instability in these areas will negatively impact liquid fertilizer production.
Overall, ongoing geopolitical conflicts have exacerbated fertilizer supply shortages and boosted input costs globally. Liquid fertilizer companies will need to diversify their sourcing networks, explore alternative raw material options, and establish regional supply hubs to mitigate such risks. Governments also need coordinated policy support and investment to enhance domestic fertilizer production capacities.
Geographical regions with high Liquid Fertilizer market concentration
The liquid fertilizer market in North America accounts for the largest share by value currently. Within this region, the US dominates demand as the agriculture sector remains highly mechanized and input-intensive. Fertilizer usage levels are also high due to extensive cultivation of major cash crops. Producers have well-established distribution networks serving large-scale farms rapidly adopting precision farming techniques.
Another region with high market concentration is Europe. Key markets include Germany, France, Poland, and Russia which collectively account for over 30% of global liquid fertilizer demand. Usage is driven by the continent's intensive agricultural production. Liquid forms are highly popular due to their flexibility of application in varying soil and climatic conditions prevalent across Europe.
The Asia Pacific region has emerged as the fastest growing market for liquid fertilizers globally.
Fastest growing region for Liquid Fertilizer market
The Asia Pacific region has emerged as the fastest growing market for liquid fertilizers globally. China dominates both production and consumption due to its massive scale of agricultural operations. Other major economies like India, Indonesia, Vietnam, and Thailand are also witnessing increased usage attributable to various factors. High population growth exerts strong demand pressure for locally-produced food. Consolidating smallholder farms and expansion of cultivation areas into lower-quality lands stimulates higher fertilizer demand. Rising incomes enable greater affordability of agro-inputs. Government initiatives to boost farm productivity through usage of fertilizers, soil amendments, and precision farming techniques are boosting adoption. Rapid development of agro-processing and food export industries in the region also supports liquid fertilizer sales. Overall, economic development, growing resource constraints on arable land, and policy interventions are driving the expanded use of liquid fertilizers in Asia-Pacific agriculture.
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