Fertilizer and the looming global food crisis

Few people are aware that beneath the worries over rice which pervade media these days is a looming disaster which could make the rice crisis seem puny in comparison.

To understand the magnitude of this global menace, one would first have to appreciate how world food production quintupled many times over from the early 19th century to the present, making possible the global population explosion.

Of course, advances in global agricultural production technology played their part in boosting food production worldwide, but even their combined impact cannot compensate for something basic to agriculture which has been mainly responsible for increases in farm production since the earliest times: fertilizer.

Relegated to the sidelines of the rice crisis now sweeping the country and the world is the rising prices of fertilizer which lends credence to DA Sec. Arthur Yap´s insistence that the rice crisis is not a supply problem but rather a price problem.

One thing which has not been given due attention in the present rice crisis is the effect of fertilizer in rice production. It´s fertilizer which enables countries like Thailand and Vietnam to have astounding rice yields compared to the Philippines. Thus, while we have a wider area planted to rice compared to these two countries, they produce more rice and we often end up importing from them. Without having to go into the details of the variance in yields between irrigated and raid-fed rice paddies, it´s easy to see evaluate the impact rising fertilizer prices have had on the farm gate and retail prices of rice.

Let´s look deeper into Sec. Yap´s contention that it is a price crisis and not a rice crisis by simply reviewing the price trends of fertilizer these past few years. From P350 per bag in 2002, Triple-14, one of the most essential fertilizer grades used for rice production in the country today, is now priced at P1,500 and could soon breach P2,000. At this price, farmers have cut down their fertilizer usage from the usual four bags to one per hectare.

It doesn´t take a cabinet secretary to imagine the impact of this depleted use of fertilizer will have on the country´s rice production. Worse, since large corporate farms are likewise dependent on fertilizer to increase their yields, domestic food production and agri-based exports would likewise be headed for a fall, with catastrophic results on the country´s balance of payments, exchange rate, and worse, retail food prices.

A main factor in the global rise in the prices of fertilizer is the rise in the price of sulfur, one of the essential components of all types of fertilizer. During the annual International Fertilizer Conference held in Paris on February 18-19, 2008, it was announced that the world´s supply of sulfur had reached scarcity level, so from only US$100 in 2006 and $300 in 2007, sulfur imported into the country from Canada and the Middle East has skyrocketed to $800 per metric ton.

In the Philippines, Triple-14 fertilizer is produced by Philippine Phosphate Fertilizer Corporation (Philphos) in Isabel, Leyte. Since local production of sulfuric is insufficient to meet the domestic market demand of 400,000 MT annually, Philphos has to seek locally available alternatives such as pyrite. Pyrite exists as surface deposits in General Santos City, Sultan Kudarat and Samar and is now used by Philphos to stabilize the local prices of fertilizer by using it in volumes that would negate the still climbing world prices of sulfur.

So why does this all matter to the ordinary consumer already burdened by rising prices of food, rice and petroleum products? With the dropping utilization of fertilizer as a result of its rising prices, domestic rice production is expected to fall by over 50% of the rice produced last year and the crisis that is being perceived today will further escalate to real crisis level as early as 2009.

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