Prices of chemical fertilizers in the country have hit successive record highs in line with their raw material costs and tight global supplies due to the impact of the Russia-Ukraine conflict. Additionally, the Thai government has allowed related entrepreneurs to raise domestic fertilizer prices so that they reflect the actual costs. Given this, we at KResearch expect that prices of imported urea fertilizer will stand at elevated levels of USD950-1,000/tons during 2022, which would be more than double those reported for 2021.
Meanwhile, oil palm farmers have been hit hard by soaring chemical fertilizer prices because their fertilizer application rate per given area is high. Rubber and sugarcane farmers have also been affected, but less so than oil palm growers. For rice growers, although their fertilizer application rate per given area is relatively low and the major rice planting season has just begun, their annual rice outputs, especially those of large rice growers might be lower than prior estimates if they cannot make adjustments.