The global energy shortages which have driven prices for coal, oil and natural gas to explosive highs in the last months are a predictable consequence of the mad pursuit of “Zero Carbon” economic policies that have seen foolish governments subsidize a growing share of electricity from unreliable solar and wind generation. One consequence has been a five-fold rise in the price of natural gas or methane across the globe. That extends from China to the EU, USA and beyond. A follow-on consequence of that natural gas shortage and price explosion is a growing crisis in world agriculture fertilizer production. This may all be no accident. It fits the WEF Great Reset Agenda of UN 2030 .
Ammonia-based fertilizers made from nitrogen (most of our air, so never in shortage) and natural gas or methane (CH4) make up almost 70% of all fertilizers used to support major agriculture crops such as wheat, corn, rice and even coffee. As natural gas prices have soared by anywhere from 300% to 500% over the past months, this has had a devastating impact on world fertilizer production where some 80% of the cost of making ammonia fertilizers is due to natural gas.
When Hurricane Ida stormed across Louisiana on August 25, the largest ammonia factory complex in the world, owned by CF Industries, was closed for safety reasons and only reopened ten days later. Curiously at that point two more factories from the same CF Industries, those in the UK, announced they would close two more fertilizer plants on September 22, claiming high natural gas prices as the cause, despite the fact their Louisiana plant had just been out for ten days. The two plants supply some two-thirds of UK domestic fertilizer demand. The Government was forced to agree emergency subsidies to CF Industries to reopen one of the two plants temporarily to ease the pressures. The combined effect of the three major closures by the same group added to the crisis in world fertilizer supply. It may be just coincidence that the two largest stock owners of CF Industries are Vanguard and BlackRock.
This crisis is snowballing. As of early October reported closures of ammonia fertilizer production had been announced by the giant German chemicals company, BASF, in Belgium and Germany, indefinitely. It also affects production of ammonia-based diesel fuel additive, AdBlue.
Further closings are ongoing in Achema in Lithuania, OCI in Netherlands. Yara International is reducing 40% of its EU ammonia fertilizer production. Fertiberia in Spain is closing a plant along with OPZ in Ukraine, a major fertilizer producer. In Austria Borealis AG has closed production and Germany’s largest ammonia producer, SKW Piesteritz, has cut production by 20%.
Worsening the overall global fertilizer crisis, the Biden Administration in August slapped sanctions on the Belarus government, explicitly naming Belaruskali OAO, the world’s fourth largest fertilizer producer, for “sustaining the Belarusian regime at the expense of the Belarusian people.” Belaruskali controls about one-fifth of the world potash-based fertilizer market.
Heart of global food security
Nitrogen-based fertilizers are far the most widely used in global farming, about three-fourths of all commercial fertilizers. Since the development of the Haber-Bosch process in Germany just before the First World War, artificial production of nitrogen fertilizers has supported the enormous expansion in agriculture productivity. Nitrogen fertilizers are made from ammonia (NH3) produced by the Haber-Bosch process. It is energy-intensive using natural gas (CH4) which is methane, to supply hydrogen. This NH3 or ammonia is used as a feedstock for other nitrogen fertilizers, such as anhydrous ammonium nitrate (NH4NO3) and urea (CO(NH2)2). Crop yields since World War Two have become strongly dependent on nitrogen-based fertilizers. It is estimated for the US that average corn yields would decline by 40 percent without...
