The Brazil fertilizers market is projected to register a CAGR of 4.4% during the forecast period (2021-2026).
The impact of the COVID-19 pandemic on Brazil's Fertilizer market has been minimal, mainly due to reduced transportation barriers. The lockdown restrictions have been exempted by the government for all types of agricultural activities, hence there has been no such effect of corona outbreak. Indeed, the fertilizer market has registered positive growth compared to last year, due to panic buying behavior from farmers.
The potential expandable agricultural land, the growing demand for micronutrient fertilizer, and government subsidies for agricultural inputs are the major factors driving the growth of the market studied. Currently, 33.0% of the country’s total land is used for agriculture. Brazil, being a large agricultural producer, offers many opportunities for agrochemical companies. The market is witnessing several joint ventures between global players that are likely to increase their market share and make Brazil fertilizers market a technology-based fertilizer market.
Key Market Trends
Increasing Fertilizer Imports in Brazil
According to National Fertilizer Association (ANDA), in the first ten months of 2018, the total fertilizer volume supplied to the Brazilian market increased by 3.9%. The survey conducted by ANDA revealed that average spending by farmers on fertilizer continued to increase, as it becomes more difficult to expand the planted areas. The trade statistics of the country are likely to remain heavily dependent on fertilizer imports. Brazil’s fertilizer imports reached about 75.0% of total domestic use in 2017-18. According to ANDA, fertilizer imports were up by 4.5% in 2018, in line with the historic five-year average. For the first 10 months of 2018, the national fertilizer production was down by 2.9% from the previous year, which was a better performance than the five-year average annual decline of 4%. Thus, the increasing import dependency, coupled with the rising fertilizer use in the country, is likely to accelerate the sales of fertilizers in the years to come.
Potassic Fertilizer Dominates the Market
Brazil accounts for 66.0% of total domestically-used fertilizer in South America, and it is continuing to expand its growing areas for crops. Hence, the fertilizer demand increased in the recent years. This trend is expected to continue, even with the planted area not expanding as fast in 2018 as it grew in the past years. According the FAO, murate of potash acquires the highest share in the potassic fertilizer use in agriculture, accounting for 499.08 thousand ton in 2016 and 484.87 thousand metric ton in 2017. Potassic is the fastest-growing fertilizer segment, due to increasing soybean cultivation in Brazil. Furthermore, potassic fertilizer is suitable for low-fertile and acid soils of tropical Brazil, which helps in increasing the yield and productivity of the sagricultural crop that is driving the growth of the segment
The Brazil fertilizer market is fairly fragmented. The companies in the market are not only competing based on product quality and promotion but are also focused on strategic moves to hold larger market shares. New product launches, partnerships, and acquisitions are the major strategies adopted by the leading companies in the Brazilian fertilizer market. Fertilizantes Heringer S.A., Yara International ASA, The Mosaic Company, Nutrien Ltd, and Eurochem Group are some of the key players operating in the market.
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