IPNI Southeast Asia Program. Fertilizer supply vis-à-vis crop nutrient demands. A brief analyses of key agricultural commodities in Southeast Asia

Transcription

1 IPNI Southeast Asia Program Fertilizer supply vis-à-vis crop nutrient demands A brief analyses of key agricultural commodities in Southeast Asia Thomas Oberthür & Tan Mei Shih IPNI Southeast Asia. IPNI Southeast Asia for

2 IPNI Southeast Asia Program 1. Market Typology 2. Crops & Fertilizers 3. Market Development Thomas Oberthür & Tan Mei Shih IPNI Southeast Asia. IPNI IPNI Southeast Asia Program for Argus NPK Webinar Fertilizers for Member Vietnam Companies June 2016, Penang

3 1 Market Typology

4 Typology of Markets Agriculture value added per worker (US$) 10,000 9,000 8,000 7,000 6,000 5,000 4,000 3,000 2,000 1,000 0 Exit Ag Subsistence 0 20M 40M 60M 80M 100M 120M 140M 160M 180M Production of all main crops in the SEA region (million tons)

5 Typology of Markets Agriculture value added per worker (US$) 10,000 9,000 8,000 7,000 6,000 5,000 4,000 3,000 2,000 1,000 0 Exit Ag M 40M 60M 80M 100M 120M 140M 160M 180M Production of all main crops in the SEA region (million tons)

6 Typology of Markets Agriculture value added per worker (US$) 10,000 9,000 8,000 7,000 6,000 5,000 4,000 3,000 2,000 1,000 0 Exit Ag Malaysia 0 20M 40M 60M 80M 100M 120M 140M 160M 180M Production of all main crops in the SEA region (million tons)

7 Typology of Markets Agriculture value added per worker (US$) 1,200 1,100 1, Exit Ag Lao PDR Cambodia Philippines Vietnam Thailand Indonesia 0 20M 40M 60M 80M 100M 120M 140M 160M 180M Production of all main crops in the SEA region (million tons)

8 Typology of Markets Agriculture value added per worker (US$) 1,200 1,100 1, Exit Ag Swing voters Value crops Food crops Subsistence 0 20M 40M 60M 80M 100M 120M 140M 160M 180M Production of all main crops in the SEA region (million tons)

9 2 Crops & Fertilizers

10 Key Crops in SEA

11 Nutrient Removals & Demand (tons) APPROACH USDA data (2016) on production (except rubber, FAO 2014) Nutrient removal values (mainly IPNI, with literature) Fertilizer Use Efficiency (literature or IPNI, +15% in 2025)) Compound Annual Growth Rate (based on 20 years) Nutrient Ratios (FAO data)

12 Nutrient Removals & Demand (tons) RICE Nutrient removed N P K Mg 1,835, , , ,781 Fertilizer requirement N P K Mg 4,588,001 1,405,239 1,088, ,953

13 Nutrient Removals & Demand (tons) RICE Nutrient removed N P K Mg N P K Mg 1,835, , , ,781 2,057, , , ,923 Fertilizer requirement N P K Mg N P K Mg 4,588,001 1,405,239 1,088, ,953 4,472,157 1,369,757 1,060, ,920

14 Nutrient Removals & Demand (tons) OIL PALM Nutrient removed N P K Mg 826,608 96, , ,092 Fertilizer requirement N P K Mg 1,777, ,302 2,055, ,969

15 Nutrient Removals & Demand (tons) OIL PALM Nutrient removed N P K Mg N P K Mg 826,608 96, , ,092 1,211, ,311 1,464, ,297 Fertilizer requirement N P K Mg N P K Mg 1,777, ,302 2,055, ,969 2,265, ,886 2,652, ,219

16 Nutrient Removals & Demand (tons) MAIZE Nutrient removed N P K Mg 373,476 65, ,043 NA Fertilizer requirement N P K Mg 933, , ,107 NA

17 Nutrient Removals & Demand (tons) MAIZE Nutrient removed N P K Mg N P K Mg 373,476 65, ,043 NA 447,465 78, ,239 NA Fertilizer requirement N P K Mg N P K Mg 933, , ,107 NA 972, , ,824 NA

18 Nutrient Removals & Demand (tons) RUBBER Nutrient removed N P K Mg 199,910 49, ,887 49,977 Fertilizer requirement N P K Mg 309, , , ,523

19 Nutrient Removals & Demand (tons) RUBBER Nutrient removed N P K Mg N P K Mg 199,910 49, ,887 49, ,895 60, ,118 60,224 Fertilizer requirement N P K Mg N P K Mg 309, , , , , , , ,939

20 Nutrient Removals & Demand (tons) SUGARCANE Nutrient removed N P K Mg 156,467 28, ,467 42,673 Fertilizer requirement N P K Mg 391, , , ,682

21 Nutrient Removals & Demand (tons) SUGARCANE Nutrient removed N P K Mg N P K Mg 156,467 28, ,467 42, ,956 40, ,956 60,261 Fertilizer requirement N P K Mg N P K Mg 391, , , , , , , ,002

22 Nutrient Removal Ratios, P 2 O 5 :N and K 2 O:N

23 Supply Ratios, Malaysia, Value Crops MALAYSIA

24 Supply Ratios, Myanmar, Food Crops MYANMAR

25 Supply Ratios, Indonesia, Food Crops INDONESIA

26 Supply Ratios, Indonesia, Value Crops INDONESIA

27 Supply Ratios, Philippines, Food & Value Crops PHILIPPINES

28 Supply Ratios, Vietnam, Food & Value Crops VIETNAM

29 Supply Ratios, Thailand, Food & Value Crops THAILAND

30 3 Market Development

31 Opportunities Typology Exiting agriculture Food sufficiency Value products Swing voters Significance for fertilizer industry Investment phase passing. Mature market may not extend beyond the next oil palm crop cycle. Only significant new sector: oil palm smallholders. Continued demand but low cash availability sets limit for new products. New geographical markets emerging. Smallholder targeted approaches required. High potential in midterm but dependent on knowledge driven, innovative supply chains. Strong growth options, but highly uncertain until institutions are in place. Smallholder targeted approaches required.

32 Opportunities Closing NPK gaps Balanced products Attractiveness Specialty products Feasibility

33 Opportunities Exit Ag Situation Attractiveness Feasibility

34 Opportunities Value Crops Attractiveness Feasibility

35 Opportunities Food Crops Attractiveness Feasibility (certainty of benefit) Feasibility

36 Putting it all together A commitment to longterm investment, based on detailed and secure analysis of market, supply and growing conditions. Growing knowledge amongst farmers and dealers to maintain trust in the product and support farmers skill to manage the product within more complex farming systems. Fertilizer is an accepted need for high production. Translating general belief into targeted ground action is complex. Identifying the right fertilizer and the right knowledge for an evolving system is critical. Increasing reengineering of supply chains to move beyond standard fertilizer products towards targeted inputs that generate known value. Ensure confidence in investment instruments that work for a region. Develop new supply chain partnerships to drive knowledge based fertilizer management.

37 IPNI Southeast Asia Program Fertilizer supply vis-à-vis crop nutrient demands Questions:

38 Opportunities Typology Exiting agriculture Food sufficiency Value products Swing voters Malaysia: Indonesia: Indonesia: Myanmar: Future market development investment Oil palm smallholder systems Improved nutrient sources Severe imbalances in in rice, maize and cassava fertilization Significant N-P-K gap in oil palm systems Severe imbalances and NPK gaps in oil palm smallholder systems Imbalances and nutrient gaps in in rice (maize, pulses) fertilization Niches for high density products Institutional uncertainty

39 Opportunities Typology Exiting agriculture Food sufficiency Value products Swing voters Future market development investment Vietnam: Right rate opportunities Thailand: Right source and rate opportunities Knowledge development opportunities

40 Geographic Opportunities Typology Exiting agriculture Food sufficiency Value products Swing voters Future market development investment Philippines: Significant K gaps in rice, maize and cassava Large nutrient imbalances Philippines: Various high value crops with potential Knowledge development required

41 Buyers Risks FUEL Certainty of Benefit

42 Buyers Risks SEED FUEL Certainty of Benefit

43 Buyers Risks FERTILIZER SEED FUEL Certainty of Benefit

44 Buyers Risks METRIC Uncertainty about the precision of input to achieve an outcome. Cook et al. Better Crops 97, (2013)

45 Buyers Risks METRIC Uncertainty about the precision of input to achieve an outcome. TEMPORAL Uncertainty related to past / future events Cook et al. Better Crops 97, (2013)

46 Buyers Risks METRIC Uncertainty about the precision of input to achieve an outcome. TEMPORAL Uncertainty related to past / future events STRUCTURAL Uncertainty about impact of other internal factors relevant to the decision Cook et al. Better Crops 97, (2013)

47 Buyers Risks METRIC Uncertainty about the precision of input to achieve an outcome. TRANSLATIONAL Uncertainty related to issues external to the decision TEMPORAL Uncertainty related to past / future events STRUCTURAL Uncertainty about impact of other internal factors relevant to the decision Cook et al. Better Crops 97, (2013)