Fertilizer prices continue to fall

Fertilizer prices have dropped further after the Christmas season, with retail prices of the commonly used inorganic inputs now 53 percent lower than their September 2008 levels, the Department of Agriculture (DA) said yesterday.

The DA attributed this to the continued decline in the price of crude oil in the world market.

Agriculture Undersecretary Jesus Emmanuel Paras said low crude oil prices have resulted in a steady drop in the prices of popularly used farm inputs like urea, complete and ammonium sulphate.   

In a report to Agriculture Secretary Arthur Yap, Paras said that as of the second week of January, fertilizer prices have dropped by 31 percent to 53 percent compared to September 2008 levels.

Dennis Mate, executive vice president of the Philippine Phosphate Fertilizer Corp. (Philphos), had informed Paras that urea, which will be available in Philphos warehouses this month, will cost only P999 per bag compared with its price of P1,900 per bag last October.

Last November, Yap said that the downtrend in the prices of oil-based fertilizers was good news for the agriculture sector, especially with palay farmers having started planting for the 2009 dry or summer crop.

To ensure that the costs of petroleum-based fertilizers remain low as a result of the decline in world crude oil prices, Yap directed the Fertilizer and Pesticide Authority (FPA) last November to keep a tight watch on the prices of these farm inputs and check against the “price gouging” activities of certain dealers and retailers who refuse to slash their retail prices.

Fertilizer prices almost doubled last year due to the nonstop jump in oil rates in the world market and big demand by other countries during the first three quarters of 2008.

The fertilizer price hike resulted in a 30 percent decline in fertilizer usage by farmers during the wet crop season, leading to a corresponding drop in per-hectare yields for those who scrimped on fertilizer usage.