Phosphorus Rate Reductions and World Demand Growth

Management of high phosphorus fertilizer prices has been common topic in the fall of 2024 and 2025. The elevated phosphate prices began in 2021, the depressed grain markets in 2024 and 2025 that drove the widespread cost cutting. A common approach has been to cut rates. More information on how to effectively reduce applications rates while limiting negative impacts can be found in a previous ALGL blog post “The Seven Most Expensive Words in Agriculture – Fertilizer Prices”.

Many rate reduction strategies implemented in the past two falls have been under the assumption that the elevated phosphorus prices will relax relatively quickly. Most fertilizer price spikes do not last very long and impact roughly two growing seasons. If this assumption is part of your phosphorus plan, a modification of the plan may be in order.

The drivers of this phosphate price elevation are a bit different than past price events that usually are a result of short-term supply interruptions or seasonal demand spikes. World demand for MAP is growing significantly as South American and Asia are looking to increase domestic grain production which has led to a significant/large increase in world phosphate demand over the past 4 years. The Asian demand increase has been driven primarily by China. China has significantly reduced phosphate exports to focus on domestic demand, thus lowering the world phosphate supply. It is foretasted that world demand should level off in 2026 with no indications of decline.

There are new sources coming online, however market forecasts are starting to project that it will be 2028 or 2029 before the demand and supply can align allowing phosphate prices to relax.

While many of us initially assumed that the high phosphate prices would necessitate reduced application volumes for 1-2 growing season based on application timing, high phosphate prices may be reality though the 2028/2029 growing season. Can your current plan support significant phosphate reduction until 2028 or 2029 without negative future impacts?

The base defense against negative impacts of altering your fertility management is routine and consistent soil sampling to monitor soil fertility changes along with tissue testing to monitor crop access to fertility. Reach out to your ALGL Regional Agronomist for help with soil fertility questions.