By Alison Coughlin
CME Group
The fertilizer market is seeing prices at or near record levels due to a variety of supply and demand factors. Prices are rising so quickly that, by early October fertilizer futures at CME Group were witnessing prices hit and exceed pre-financial crisis 2008 levels.
Several supply issues are contributing to the growth in fertilizer prices. First, short-term capacity or logistical constraints have hampered some plants’ ability to supply the market. Severe weather has also hit some producing regions. Hurricane Ida forced shutdowns in Louisiana near the Gulf, where a significant amount of fertilizer is produced and transported. Labor shortages are being felt by transportation companies, meaning even the fertilizer that is produced is costing more to move.