The market for liquid fertilizers is estimated to grow at a CAGR of 3.9% for the forecast period 2020-2025. North America is estimated to be the second-largest consumer of liquid fertilizers. Within the region, the US, Canada, and Mexico are the largest markets for liquid fertilizer, with the US dominating the market. In the North American region, the lands are acidic in nature and the use of nitrogen fertilizers helps in maintaining the desirable pH level of the soil, which is one of the major drivers for the growth of the liquid nitrogen-based fertilizer market. Urea is the most widely used liquid nitrogenous fertilizer in the region. The liquid micronutrient segment of the North American liquid fertilizer market is growing at a rapid pace, and the growth can be attributed to the rising demand for food grains and increasing soil deficiency.
Key Market Trends
Increase in Demand for High Efficiency Fertilizers
From the perspective of the world population reaching more than 9 billion by 2050, and the need to alleviate persistent hunger, nutrient management shall ensure the continuous increase in agricultural production. The need to improve food security has strongly influenced the demand for high-efficiency fertilizers over the years. Moreover, future demand is likely to be driven by a broader set of considerations, including the need to reduce the environmental impacts of nutrient losses. The yield and production of cereals and fruits have grown at comparatively higher rates when compared to the area under cultivation indicating a higher adoption rate of high-efficiency fertilizers. International Fertilizer Association (IFA) anticipates that in the next five years, world liquid fertilizer demand is likely to increase by 1.5% per year with a significant increase in the North America region as well.
United States Dominates The Market
Liquid fertilizers hold the largest share of consumption in the US within the North American region. More than one-fourth of the fertilizers used in the United States are liquid fertilizers.
The major market drivers in the US are the easy application and the availability of large wagons to fill liquid fertilizers. Additionally, the high adoption of precision agriculture technology is driving the market growth, as the use of variable rate technology (VRT) requires the use of liquid fertilizers. Around 77% of VRT farming use fertilizers, however, the adoption of VRT farming for pesticides and seeds is quite low, estimated to be 11% and 7%, respectively. Among the fertilizers used in VRT, lime-based fertilizers have the largest share, followed by single nutrient and multiple nutrient fertilizers.
The North America Liquid Fertilizers Market is fragmented with major companies accounting for a lesser share of the market than small players. Companies have been actively looking to expand its business by establishing new manufacturing units and by acquiring businesses or other companies involved in the business. For example, Nutrien limited has announced in 2018 that it is looking at expanding several nitrogen fertilizer plants in North America due to rising prices of nitrogen.
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