Fertilizer: Made in Brazil

By Renee Targos
Editor

Brazil learned in the last three years how outsourcing fertilizer can be a risky business. With Brazil importing 85% of its fertilizer, and as the fourth largest consumer of fertilizers globally, the country found itself in a tenous position during COVID-19 supply chain breakdowns and the Ukraine-Russia war, disrupting the 25% of fertilizer imported from Russia.

In a quick pivot, the Brazilian government launched the 2022-2050 National Fertilizer Plan (Plano Nacional de Fertilizantes) to increase domestically produced fertilizer from 15% (2022) to 55% (2050).

The NFP’s goals also included attracting foreign investments to help Brazilian businesses grow the fertilizer sector as well as plant health products.

For Yara Brazil, a company leading approximately 150 studies on the benefits of using fertilizers in different agricultural crops with institutions, the NFP still needs some fine tuning.

Francielle Bertotto, Business Development and Sustainability Manager for Yara Brazil

“It addresses a set of initiatives aimed at transforming infrastructure in the coming decades, allowing Brazil to produce at least half of the fertilizers it consumes,” says Francielle Bertotto, Business Development and Sustainability Manager for Yara Brazil. “The launch of the plan is a good first step. But for it to become a reality, only a significant increase in the competitiveness of domestic production, coupled with greater security related to access to raw materials at competitive costs, especially natural gas in the case of nitrogen-based fertilizers, and more stable tax regulations will make investors confident enough to undertake these substantial investments.”

Investments are needed as Brazilian growers continue to increase use. According to the National Association for Fertilizer Promotion (ANDA), it is reported the fertilizer  market is expected to grow to 45 Mt in 2024, which is a 2% increase year over year.

Companies like Yara and EuroChem are stepping up their game to meet the needs. In 2022, EuroChem acquired its first integrated phosphate mining operation in the region of Serra do Salitre, Minas Gerais. It is forecasted that the first quarter of this year, Salitre will add +1MMT phosphate fertilizer production and supply 15% of all phosphate fertilizers to the Brazilian market.

Gustavo Horbach, Head of South America for EuroChem

Gustavo Horbach, Head of South America for EuroChem, says the government’s NFP direction to remedy outsourcing fertilizer is a good one and what the Brazilian growers need. “The policies being put in place by the National Council of Fertilizers and Plant Nutrition (CONFERT) will help reduce external vulnerabilities and high dependence on imports from 85% to around 50% by 2050, and consequently, provide greater security of supply to rural producers.”

Maximizing Yields
As climate change brings higher temperatures and drought as well as excessive rainfall, Brazilian growers are seeking fertilizers and plant health products to help crops become more resistant to abiotic stressors.

There is also a trend for growers to use regenerative agriculture practices. Multinational companies are investing in supports for growers to adopt regenerative practices, such as Nestle’s $1.3 billion investment in 2021, as well as commitments and investments from Pepsico, Starbucks and General Mills.

“Farmers in Brazil and around the world are increasingly seeking high-tech inputs that provide essential nutrients for plants and have low greenhouse gas emissions,” says Bertotto. “They aim to contribute to the development of regenerative agriculture, which goes beyond merely protecting the environment to restoring its natural characteristics. Additionally, there is a growing interest in solutions with predictive effects related to extreme weather events, such as El Nino. In this regard, the use of biological products is gaining popularity among farmers.”

It’s not only weathering the climate change, but also increasing yields for a world that needs the country’s produce. “Brazil is the third largest exporter of agricultural products after the U.S. and EU, producing enough food annually to feed 800 million people,” says Horbach.

“The trend in the industry continues to be for products which maximize yields, while minimizing our environmental impact,” Horbach continues. “For instance, products which increase nitrogen-use efficiency while reducing green house gas emissions, and water solubles that allow micro-application is where we’ve seen 10% year over year growth in demand.”

Government Initiatives
As far as regulations, the Brazilian government is working to streamline the process for fertilizers with caveats for plant health products.

Viviane Kunisawa, Partner with Daniel Law in Brazil, says, “Brazil does heavily depend on the importation of fertilizers and their registration is a requirement for commercialization and use. However, in order to have more efficiency, the Ministry of Agriculture has implemented an automatic registration system, which does not exempt the products from complying with composition and quality patterns according to the legislation – requirements which are subject to inspection. Biostimulants, as a rule, have to demonstrate bioactivity and, consequently, are not entitled to the automatic registration system.”

In addition to streamlining the regulatory process, public policies are helping to build the infrastructure to increase fertilizer production such as the Fertilizer Industry Development Program (Profert), which also is designed to assist in accessing raw materials as well as business development. There is also a need for support of growers.

“The solution to the challenges that society and the planet will face in the coming years involves more productive and sustainable agriculture, where farmers are rewarded not only for how much they produce but for how they produce,” says Bertotto. “This scenario has been crucial for significant changes in the food value chain, where more sustainable practices will be rewarded, creating a positive and lasting cycle.  •

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Francielle Bertotto, Business Development and Sustainability Manager – Yara Brazil
Gustavo Horbach, Head of South America – EuroChem