On August 11, 2023, Ukraine is set to produce a record volume of nitrogen fertilizers, reaching over 220,000 tons across various types of nitrogen fertilizers, which marks the highest level since March 2022, according to the UkrAgroConsult.
The growing demand for nitrogen fertilizers in the EU countries and Asian markets allows Ukrainian producers to anticipate a consistent demand over the next three months.
"Thanks to successful sales of nitrogen fertilizers in June and July, Ostchem managed to secure orders through September. Therefore, it is crucial to ramp up production to the maximum. The task for the two plants is significant; by various estimates, the market has potentially seen sales of 120 to 150 thousand tons of nitrate and 60-70 thousand tons of urea over the past two months, not to mention ammonium nitrate and other fertilizers, for which demand is still not fully sufficient, given that autumn fieldwork in Ukraine continues," the statement says.
It is anticipated that the plants in Cherkasy and Rivne will produce up to 100,000 tons of nitrate in August. Cherkasy's "Azot" plant will fulfill its maximum plan for urea and load ammonium nitrate by 60%, while "Rivneazot" will be able to launch limestone nitrate in the second half of August. In total, the plants will produce 220-225 thousand tons of products, an absolute record over the last 530 days of the conflict in Ukraine.
Meanwhile, UkrAgroConsult note that in September, the Odesa Port Plant and "DniproAzot" may be launched, adding further volumes of nitrogen fertilizers to the country's market. These enterprises will compete for the limited domestic consumption market and venture into the global market.
"Producers who are unable to sell nitrogen domestically in August (when agroholdings make purchases) will be compelled to hold onto their stock until February (when small and medium-sized agricultural enterprises will be purchasing). Another sales option is to export nitrogen fertilizers. This option will become attractive for everyone from September 2023. The fertilizer market situation has been complicated by Russia's exit from the 'grain deal,' affecting agricultural product prices," the analysts predict.
Fertilizer market experts anticipate that due to the successful realization of a good harvest by farmers in 2023, they are likely to buy more fertilizers for the 2024 season.
