Fertilizer Purchasing Power Index closes at 1.11 in July

The Fertilizer Purchasing Power Index (IPCF) for July 2024 reached a value of 1.11, a result that reflects the drop in the price of commodities and the increase in some fertilizers. Despite delays in fertilizer purchases, the outlook remains positive for the second corn and cotton harvest, with recovery expected in the coming months to avoid logistical backlogs at the end of the year.

Commodity prices fell -4,6% for corn and -2,15% for soybeans compared to June. The price of fertilizers rose by around 3% in the period, with emphasis on the 6% increase in simple superphosphate (SSP), 5% in monoammonium phosphate (MAP) and 1% in urea. Potassium chloride (KCl) remained stable.

The American harvest continues to have good prospects and the most recent figures from the United States Department of Agriculture (USDA) corroborate this estimate. In Brazil and South America, indicators also remain good, with production and productivity adjustments mainly in the second Brazilian harvest. This entire scenario puts pressure on soybean and corn prices. In July, the domestic market registered some positive spikes driven by the increase in the dollar, which allowed some negotiations in real (R$) to be more advantageous. The dollar varied around 2% in the period, in a scenario of greater global uncertainty pressured by Brazilian inflation and the tension in the scenario of the North American elections and the geopolitical context.

The market remains attentive to the development of the harvest in the United States, negotiations and planting intentions for the next Brazilian harvest, in addition to the harvest of the second harvest, which is approaching its end and has provided surprising numbers in some regions. As usual, it is also important to pay attention to the weather outlook for the beginning of September, which will dictate the window for the next harvests.