With greatly increased demand for basic food agricultural products to sustain the growing population, particularly in countries where population density is high and continues to rise at a rapid pace, the demand for fertilizers has also increased significantly. Such demand is likely to continue to rise considerably in the next few years, particularly in a number of developing countries where agricultural production will have to be substantially increased to meet domestic demand and to provide export opportunities for particular agricultural products. The availability of chemical fertilizers at reasonable prices, therefore, constitutes an essential feature of agricultural development in most countries and particularly in several developing countries which continue to be basically agricultural economies.
World fertilizer consumption has risen above 100 million metric tons (mmts) of nutrients a year. A quarter of this is in developing countries. Though these countries have increased their fertilizer consumption by more than 50% since 1973-74, the amount is still insufficient to produce adequate food. Despite the energy crisis, there should be no disagreement about the urgency of sustaining rapid growth in fertilizer consumption in the developing world. Population pressure on land, growing food deficits, depleted soil fertility and the complementarity between proven yield-increasing technologies and high levels of fertilizer application all point up its importance.
[Industrialized countries]
In the USA, although relatively efficient methods are used in transport and handling, getting the fertilizer from the production point to the farmer accounts for as much as two thirds of the cost.
[Developing countries]
Fertilizer production facilities in many developing countries are operating substantially below capacity; in some cases the operating rate is less than half the design rate. Domestic production has constantly been below domestic demand and consumption, necessitating large imports of chemical fertilizers by these countries. There are a number of reasons for this, but they are usually due to a combination of: processing problems, inadequate maintenance, high fixed operating costs, lack of market for the product – or inability to market it, inadequate supplies of feed materials, inadequate transport and storage facilities, lack of operating capital, technical incompetence, poor product quality, and lack of dependable power and water supplies. Also, shipping, storage and handling costs in the developing countries often represent more than half the total cost of getting the fertilizer to the farmer.
The real question concerning the developing world is not whether but how to maintain rapid growth in fertilizer consumption.