https://www.reuters.com/business/energy/nitrogen-fertilizer-shortage-threatens-cut-global-crop-yields-cf-industries-2021-11-04/

 
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November 4, 20216:36 PM UTCLast Updated ago
Energy

Nitrogen fertilizer shortage threatens to cut global crop yields -CF
Industries

By Rod Nickel

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2 minute read
A general view of the CF industries plant in Billingham, Britain
September 22, 2021. Picture taken with a drone. REUTERS/Lee Smith/
File Photo

A general view of the CF industries plant in Billingham, Britain
September 22, 2021. Picture taken with a drone. REUTERS/Lee Smith/
File Photo

Nov 4 (Reuters) - A shortage of nitrogen fertilizer due to soaring
natural gas prices is threatening to reduce global crop yields next
year, CF Industries, a major producer of the crop nutrient, said on
Thursday.

European gas prices have jumped amid high demand, as economies
recover from the pandemic and with below-average gas storage levels
at the start of the winter heating season. Natural gas is a key input
in the production of nitrogen-based fertilizers and higher costs have
caused some producers to cut production.

"Who's going to get the scarce tons that are out there? ... There's
going to be a lot of unmet demand that's going to be pent up," CF
(CF.N) Chief Executive Tony Will told analysts on a conference call.
"And so we do think yield is going to be, on a global basis, off next
year. Not because of demand destruction, just because there's not
enough tons available."

Prices of nitrogen fertilizer, one of the most commonly used
fertilizers to boost production of corn, canola and other crops, are
at their highest levels in more than a decade.

Hurricane Ida also hit CF's ammonia plants in Louisiana in late
August, forcing them to halt production.

Strong global fertilizer demand looks set to last into at least 2023,
CF Senior Vice-President of Sales Bert Frost said.

U.S.-based CF's predictions of constrained crop production echo those
last month of Norwegian rival Yara International ASA (YAR.OL), which
warned rising fertilizer costs would drive up food prices and could
lead to famine.

Russia will limit exports of nitrogen fertilizers for six months to
try to curb any further increase in food prices, its prime minister
said on Wednesday. China is also limiting nitrogen exports.

CF reported on Wednesday a $185 million quarterly net loss, factoring
in an impairment charge related to shutting its United Kingdom
operations in September due to high natural gas costs.

Reporting by Rod Nickel in Winnipeg Editing by Mark Potter

Our Standards: The Thomson Reuters Trust Principles.

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