Phosphate
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[edit] Phosphate
Phosphorus is the third most limiting nutrient with respect to macronutrient uptake. Nitrogen and potassium are the only other essential plant food nutrients taken up in greater quantities and the potential and occurrence for phosphorus deficiency is second only to nitrogen.[1]
Phosphorus is present in the body almost exclusively in the form of phosphate. Most of the body's phosphate is contained in bone. The rest is located primarily inside the cells, where it is involved in energy metabolism. Phosphate is necessary for the formation of bone and teeth. Phosphate is also used as a building block for several important substances, including those used by the cell for energy and DNA (deoxyribonucleic acid). Phosphate is taken in from the diet and excreted in urine and stool.[2]
[edit] General uses
Phosphorus plays a vital role in energy transfer, photosynthesis, nutrient transport, sugar metabolism, plant genetics, cell division and as a structural component of the plant.Crops with adequate phosphorus show steady vigorous growth and earlier maturity. Earlier maturing crops are less susceptible to summer drought, disease infection, frost and harvest damage.Plants absorb soil solution phosphorus in both the H2PO4-1 and HPO4-2 forms.[3]
[edit] Pricing structure
[edit] Demand
The latent demand for phosphate rock mining is not actual or historic sales. Nor is latent demand future sales. In fact, latent demand can be lower either lower or higher than actual sales if a market is inefficient (i.e., not representative of relatively competitive levels). Inefficiencies arise from a number of factors, including the lack of international openness, cultural barriers to consumption, regulations, and cartel-like behavior on the part of firms. In general, however, latent demand is typically larger than actual sales in a country market.
For reasons discussed later, this report does not consider the notion of “unit quantities”, only total latent revenues (i.e., a calculation of price times quantity is never made, though one is implied). The units used in this report are U.S. dollars not adjusted for inflation (i.e., the figures incorporate inflationary trends) and not adjusted for future dynamics in exchange rates (i.e., the figures reflect average exchange rates over recent history). If inflation rates or exchange rates vary in a substantial way compared to recent experience, actually sales can also exceed latent demand (when expressed in U.S. dollars, not adjusted for inflation). On the other hand, latent demand can be typically higher than actual sales as there are often distribution inefficiencies that reduce actual sales below the level of latent demand.[4]
[edit] Current consumption trends
In 2007, U.S. phosphate rock production fell below 30 million tons for the first time in more than 40 years, owing to lower production in Florida. Additionally, phosphate companies in Florida used a substantial amount of phosphate rock from stocks. One mine in Florida reopened after being closed for 18 months, but its output was offset by mine closures that occurred in 2006. China has surpassed the United States as the leading producer of phosphate rock in the world. Domestic consumption of phosphate rock increased slightly because of higher phosphoric acid output. Domestic consumption of phosphate fertilizers was predicted to increase from 4 million tons P2O5 to about 4.3 million metric tons in 2008 because of higher corn planting, primarily for ethanol production. The United States remained the world’s leading consumer, producer, and supplier of phosphate fertilizers; however, its share of the world market has been shrinking. Phosphate fertilizer production increasingly is being located in the large consuming regions of Asia and South America, reducing the need for imported fertilizers to these regions. U.S. exports of phosphate fertilizer to China and India, the two largest consumers of phosphate fertilizers, have dropped significantly since 2000. Exports of DAP to India rebounded slightly in 2005-06 owing to temporary plant closures in India and increased consumption, but dropped by about 30% from 2006 to 2007 because of increased foreign competition. Export tonnage of P2O5 contained in phosphate fertilizers decreased by about 20% in 2007 compared with that of 2006. [5]
[edit] Price forecasts
[edit] Future Capacity and Supply/Demand Balances
During the next five years, several new projects are expected to come on stream, with developments announced in various regions. The global phosphoric acid capacity is forecast to increase by an overall 13 per cent, to 49 Mt P2O5 in 2009. The majority of this increase will be dedicated to local downstream production, with little impact on the availability of acid for exports. Between 2004 and 2009, DAP capacity will increase from 20 Mt to 23.5 Mt P2O5, capturing a 60 per cent share of the overall capacity increment of processed phosphates. China will be the largest contributor to the growth in processed phosphate capacity, with a 65 per cent share. Outside China, capacity additions will mostly occur in Brazil, India and Morocco. During the forecast period from 2005 to 2009, the global P2O5 fertilizer demand is projected to expand at an annual rate of 3 per cent, reaching 40.7 Mt P2O5 in 2009. Most of the increase in the demand of phosphate fertilizers will be based on phosphoric acid. Therefore, the global demand of phosphoric acid for fertilizers should be close to 31 Mt P2O5 in 2009, representing an increase of 3.3 Mt P2O5 compared with 2004. Between 2005 and 2009, the world production capability will expand by an overall 14 per cent (or 5.0 Mt) to 40.9 Mt P2O5 in 2009. Our calculations of the overall phosphoric acid supply/demand balance show a relatively tight market situation in the short term, with a surplus averaging 2.9 Mt P2O5. After 2007/08, this surplus will tend to increase and may reach 4.0 Mt P2O5 in 2009, as new capacities are commissioned. In 2009, the surplus would equal 10 per cent of the world’s supply capability.
Global phosphate supply/demand balance: 2005-2009
(Million tonnes P2O5) 2005 2007 2009
Phosphate fertilizer consumption 37.2(05) 39.1(07) 40.7(09) Fertilizer phosphoric acid demand 27.7(05) 29.6(07) 31.0(09) Phosphoric acid capability 35.7(05) 38.0(07) 40.9(09) Global phosphoric acid balance + 2.9(05) + 2.8(07) + 4.1(09)[6]
[edit] World Phosphate Rock Outlook
World demand of phosphate fertilizers in 2006 grew by 4.3% over 2005, to 38.3 Mt P2O5. The global supply of processed phosphates in 2006 expanded, but tonnage for phosphoric acid export was tight in view of strong domestic demand and some production disruption.
The international phosphate fertilizer industry continued to face high input costs, which resulted in sustained prices of DAP and MAP during 2006. In early 2007, projections of strong demand and expectations of tight supplies led to record price levels.
World phosphate rock production was estimated by IFA at 167.6 Mt rock, representing a 2.7%-decrease over 2005. This reduction was caused by much lower output of phosphate rock, especially in North America and, to some extent, in most of the exporting countries. Based on IFA’s projections for the period from 2007 to 2011, world phosphate rock capacity is expected to increase at a compound annual growth rate of 4%, from 182 Mt in 2007 to 215.7 Mt in 2011. On a regional basis, future rock supply is projected to increase in West Asia, Africa, East Asia (mostly China) and Latin America (Brazil, Peru and Venezuela).. As a single country, China will account for one-third of the increase during this period.[7]
[edit] External References
- ↑ http://www.agrium.com/products_services/ingredients_for_growth/phosphate/index.jsp
- ↑ http://www.merck.com/mmhe/sec12/ch155/ch155h.html
- ↑ http://www.agrium.com/products_services/ingredients_for_growth/phosphate/index.jsp
- ↑ http://www.marketresearch.com/product/display.asp?productid=1337090&g=1
- ↑ http://minerals.usgs.gov/minerals/pubs/commodity/phosphate_rock/mcs-2008-phosp.pdf
- ↑ http://www.fertilizer.org/ifa/publicat/PDF/2005_kl_ifa_summary.pdf
- ↑ http://www.fertilizer.org/ifa/publicat/PDF/2007_istanbul_ifa_summary.pdf
