Peak phosphorus no cause to sound alarm

01-02-2010 | Hugh Stringleman

The term "peak phosphorus" is being bandied about in Australia, along with warnings of huge hikes in fertiliser prices.
New Zealand fertiliser companies say world prices are now volatile, after decades of relatively flat graphs, but they won't endorse alarmist talk of the world running out of major nutrients, like phosphate, potash and nitrogen.
Ballance chief executive Larry Bilodeau concedes the world's supply of phosphate rock now appears to be falling, meaning that technically the "peak" of production has been passed.
However, Morocco still has 100 year-plus supplies, China has reserves and other deposits will become economic to mine if world prices rise.
So are Kiwi farmers exposed to much higher fertiliser prices as the world population grows and the demand for more food increases?
Bilodeau believes food and fertiliser prices move in tandem and "fertiliser prices won't rise above farmers' capacity to pay".
He calls this a self-correcting system, whereby if food and fibre prices remain low, farmers can't afford any more fertiliser and the rock phosphate sellers can't lift their prices.
Ravensdown chief executive Rodney Green concurs, with some caveats.
"Biofuels production helped create the big spike in fertiliser prices in 2008 and may do so again, while the supply of higher-grade phosphate rock (suitable for superphosphate) is diminishing within the bigger rock-reserves picture," he said.
This country's use of imported mineral fertilisers has other built-in safeguards, like effluent irrigation in the dairy industry and industry dominance by two farmer-owned co-operatives which don't over-sell fertilisers to farmers.
It makes good environmental and economic sense to budget your nutrients and only buy what you need, both leaders emphasised. Nutrient budgeting is widespread, which is the not the case in developing countries.
We put a lot of effort into accurate placement of nutrients, because NZ farmers work at the top of the response curve, which means fertiliser which is not placed where it is needed, is wasted.
Bilodeau and Green were commenting on two recent Australian articles in which academics warned of growing demand for phosphorus, because of population growth and aspirations towards meat eating, while known reserves of rock are
dwindling.
Respected Australian science communicator Professor Julian Cribb, a former adjunct professor at the University of Technology Sydney (UTS), said the cost of nutrients could rise 500% to 1000% over the next 20 to 30 years and called for a national nutrient plan which would encourage loss minimisation and re-cycling.
Large proportions of applied nutrients are lost to excretion, exporting and erosion, he said.
"The nation which can most successfully close the loop on nutrients by recycling will be at a global economic, nutritional and competitive advantage as well as having cleaner water and a healthier natural environment.
"It will be more food secure on a planet destined for global food insecurity," Cribb said.
Fellow UTS researchers Dana Cordell and Stuart White have argued that phosphorus supply is finite and more than one-third of the world's need comes from Morocco, from politically unstable regions.
China has the largest known reserves, but in 2008 it placed a tariff on exports to protect domestic supplies.
The US, thought to have just 25 years of deposits left, stopped exporting a decade ago and has begun importing.
Diammonium phosphate (DAP), which is the main phosphatic fertiliser in countries which do not use superphosphate, recently rose in price by 50% to US$450/tonne, but that is a long way short of its 2008 peak of $1260.
Humans consume three million tonnes of phosphorus annually in their food and excrete it again, which has led some nations to consider recycling urine as a fertiliser.
However, Cordell and White (www.phosphorusfutures.net) also say maximum phosphorus production won't occur until 2040 - that is when the supply will "peak".
Bilodeau said rising world prices for rock will encourage more mining.
Saudi Arabia is building a massive DAP plant to use its own rock and even NZ has known reserves, under the sea on the Chatham Rise, which at US$200/tonne for rock, mining becomes viable.
World prices are only half that level now, but they did rise to US$400 briefly during 2008.
Bilodeau, a Canadian, said his home country had hundreds of years of potash reserves, while urea is made from nitrogen in the atmosphere.
China can make considerable gains in efficiency of fertiliser use and would be forced to make cuts in tonnages applied because of environmental pollution due to over-fertilising.
Fertilisers in China have been cheap, offering quick yield boosts without monitoring or technological advice, but the loss of nutrients into water had been huge, and could not continue, Bilodeau said.
It has been estimated China uses 40% more fertilisers than its crops need, resulting in about 10 million tonnes of fertilisers a year being deposited into rivers and lakes.
China produces 24% of world grains, but uses 35% of global fertiliser tonnages.
Green said Ravensdown's plan to use huge Southland coal deposits to power a urea plant was very exciting, because it would substitute for imported nitrogen fertilisers.
"We have the raw material in abundance to produce something that NZ farmers need."
Ravensdown has joined with Solid Energy to confirm the economic viability of a plant, and the study is expected to be finished soon, Green said.
The plant, which could cost upwards of US$1 billion, would produce up to 1.2 million tonnes a year of urea from up to 2 million tonnes a year of lignite.
Current imports of about 500,000 tonnes annually would be replaced and 750,000 tonnes generated for export, which at 2008 prices would generate about $1.5 billion of export-equivalent income, Green said.

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