Fertiliser giant Nutrien says farmers must use less

Although Canadian giant, Nutrien, is currently rushing to boost its own potash and nitrogen output to help ease severe supply shortages and soaring costs to food producers, global boss, Ken Seitz, warns that the world's expanding croplands are actually consuming too much fertiliser for their own good.

In Australia for a week's visit, he said historical rates of land use expansion and fertiliser application were simply not sustainable.

He conceded big pressures were on farmers to produce more food, which historically meant relying on synthetic fertiliser, other manufactured input technologies and plant breeding advances.

However, the reality of low carbon emission targets and balancing the management of the planet's fertiliser and soil resources now required crop yield increases "faster than we have previously, without proportionally increasing fertiliser use".

The company's interim president and chief executive officer said agriculture must focus harder on biological products and management practices which enhanced the natural efficiency of nutrients, while also boosting productivity.

Mr Seitz remarks represent a poignant insight into how Nutrien - which sells 27 million tonnes of potash, nitrogen and phosphate annually - sees its agribusiness priorities in a climate-changed world where population growth has hit 80 million a year.

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He said the past year's spikes in fertiliser demand and supply pressures, including barriers created by Russia's war on Ukraine, would likely accelerate the swing to new farm product options and management strategies.

This, in turn, meant future productivity and sustainability gains must rely on more advanced soil and crop analytics, digital agronomy strategies, and even more precise precision agriculture.

"We can't be passengers in setting the course for our industry, we all have a critical role to play in driving the industry forward," he said of Nutrien's role.

"The challenges we face in the next few decades are all intrinsically linked - profitability, sustainability and digital adoption."

Addressing the National Farmers Federation's Canberra convention, Mr Seitz said the farm sector had already worked out it had to change.

Australian red meat producers had set a 2030 carbon neutral goal and the grain industry supported net zero agricultural emissions by 2050.

"It's clear the industry is already moving," he said.

Nutrien, too, had "ambitious" climate action and environment goals, including a 30pc cut in greenhouse gas emission intensity by 2030 and a blueprint to help scale up sustainable farming strategies.

A massive "carbon program" monitoring, among other things, soil nitrogen fixation and plant uptake, was now testing 100,000 hectares of North American farmland.

It would grow to 500,000ha next year, and was soon to extend to Australia.

At the same time, however, in response to fracturing global supply chains, particularly in the Black Sea region, the fertiliser kingpin has scrambled to lift production at its North American potash mines to 15 million tonnes this year - 20pc more than in 2020.

Its 2022 output will account for more than 70pc of global potash production.

Nutrien will also add 500,000t to its nitrogen output in the next few years.

To help buffer Australia farmers from global demand imbalances, price pressures and input supply delays, Nutrien's West Australian liquid urea ammonium nitrate storage capacity was undergoing a multi-million dollar expansion.

Its WA farm chemical manufacturing capacity had also quadrupled since 2020 and the whole Australian business had lifted investment in shoring up its stocks of inputs and agronomy resources for farmers.

"We're closely connected with growers and what their needs are. We want to be sure they can do their job," Mr Seitz said.

"We're feeling pretty good about (inputs) availability and demand pressures in Australia at the moment.

"A lot of work and foresight has gone into procuring early, but, yes, there have been past problems with crop protection products.

"Fortunately, if we've had issues with supply we have been able to offer alternatives."

However, on the other hand global supply and demand pressures also meant the costs flowing through to growers had leapt in the past two years.

Mr Seitz said it was too difficult to say how much farmers were likely to see input prices rise this year, but any discussion about cost increases needed to include food prices.

Food prices needed to reflect farmers costs, "or worldwide food supplies will suffer".

Margins had to be reasonable to reward farmers for their effort and investment commitment to new technologies, including ways to better manage and monitor their soils and the nutrient cycle.

"We need growers to make a happy living, and feel rewarded," he said.

"They're closely looking at the mathematics all the time."

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