Fertilizer Purchasing Power Index registers improvement for the second consecutive month

The Fertilizer Purchasing Power Index (IPCF) for May 2024 reached a value of 0,97. This result represents a drop of 2% compared to last month, when the index reached 0.99. Compared to May 2023, the drop was also 2%, signaling a positive trend and reinforcing the potential for continued growth in the agricultural sector. The moment is favorable for purchasing the input, since the lower the indicator, the better the exchange ratio for the rural producer. Additionally, good planning, ensuring the receipt of fertilizer within the correct period, helps to avoid potential logistical backlogs during the planting season.

The average price of fertilizers rose by around 0,2%. There was a slight reaction in the prices of simple super phosphate (SSP) and potassium chloride (KCl) due to active demand for these nutrients. Commodity prices fell by -1% led by sugar cane (-4%), followed by cotton (-2%). The increase was recorded in corn (+1%) and soybeans (+5%).

In May, the corn and soybean market showed price gains due to the impacts of torrential rains in Rio Grande do Sul, although the volume impacted is still unknown. These two crops had not yet been 100% harvested in the state and, therefore, the market began to price this loss in volume by increasing prices. In mid-May, a certain delay in planting in the US due to rain also bothered the market, but the good outlook soon took hold, limiting increases. Exchange rate variations are also considered when calculating the index. During the period analyzed, the dollar remained practically stable, showing a positive fluctuation of only 0.2%.

Now, the market remains attentive to planting in the USA, which is happening at a rapid pace and has good prospects so far. Attention is also focused on the corn harvest in Brazil, which has already harvested around 2% of the volume, with good productivity in Mato Grosso.

Additionally, good planning, ensuring the receipt of fertilizer within the correct period, helps to avoid potential logistical backlogs during the planting season. With the increase in demand for fertilizers to cover the delay in terms of commercialization, the balance of supply and demand, especially phosphorus, is quite adjusted, further highlighting the importance of purchases being made in advance, avoiding possible shortages in addition to potential logistical backlog.