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16th AFA Int’l Fertilizers Forum & Exhibition February 2 - 4, 2010 Cairo Semiramis Intercontinental Hotel, Egypt

Current World Potash Situation & Future Outlook

Mr. Hillel Magen Director IPI

Switherland


Current World Potash Situation & Future Outlook H. Magen, IPI; ipi@ipipotash.org Between 1992 and 2008 global potash consumption has steadily increased at a higher rate than that of nitrogen, resulting in an improved K:N ratio and reversing the trends of recent decades. The main reason for this is the change in diets in regions with high population growth, where there is an increased demand for meat, vegetables, fruits and vegetable oils. For example in China, during the later 1990’s, 38% of potassium used was for the production of vegetables and fruits (FAO, 2002). However according to a recent assessment (IFA, 2009) this had increased to 50% of the total potash used in the country. Freeman (2009) estimated that between 2002 and 2007, China, India, Brazil, Malaysia and Indonesia consumed almost 80% of the potash used in developing countries, and 50% of the global K consumption. In an earlier analysis (Magen and Imas, 2006), we estimated that during the last 15 years the global increase in production of vegetable, fruit and oilseed (mainly soybean and oil palm) crop sectors accounted for approximately 5060% of the additional annual requirement for potash. Indeed, there is an overlap between these crop sectors and the regions cited as the major potash consumers. Will the trend of steadily increasing demand for potash continue? While consumption in 2009 is far below that of 2008, the underlying factors affecting potash consumption have not changed, and are similar to those that have prevailed for the last two decades. According to the FAO (2002), the additional calorie intake in 2030 in developing countries will be mainly from wheat, vegetable oils and meat; crop productivity in 2030 will achieve an improvement of approximately 30% compared with 1997-99. In addition, harvested land will also increase particularly for crops like maize, sugarcane, soybean and groundnut. All these emphasize the need for efficient fertilization practices to sustain this growth. Additional demand for food, feed, fiber and biofuel, as well as the demand for better quality food, will impose significant pressure on natural resources such as land and water and require more efficient crop production. Cereal based cropping systems may also change, with maize rapidly increasing its share. Based on future crop production, cropping systems and patterns of fertilizer use, we estimate that the majority of future potash consumption will be concentrated quite equally between cereals, fruit and vegetables and oilseeds.


References Bain, B., 2009. Outlook for international prices of fertilizers, raw materials and intermediates. Presentation at the FAI annual seminar 2009, Hyderabad, India, 3-5 December, 2009. Dobermann, A. and Dawe. D. (2000). How much fertilizer is needed for irrigated rice in Asia? Presentation given at ASA meeting by A. Dobermann, 2000. Dobermann, A., and K.G. Cassman. 2005. Cereal area and nitrogen use efficiency are drivers of future nitrogen fertilizer consumption .Science in China 48. Series C. FAO, 2002. World agriculture: towards 2015/2030. ISBN 92-5-1047461-8. FAO. 2006. World agriculture: towards 2030/2050; interim report. FAO, Rome. Fairhurst, T. and Witt, C. (2005). Fertilizer market potential in plantation crops in Indonesia. A presentation made at the IFA Regional Conference for Asia and the Pacific, Singapore, 6-8 December. Freeman, M., 2009. MOP – overpriced or undervalued? Presentation made at the Fertilizer Latino Americano, 18-20 January 2009, Panama City, Panama. Galloway, J.N., F.J. Dentener, D.G. Capone, E.W. Boyer, R.W. Howarth, S.P. Seitzinger, G.P. Asner, C.C. Cleveland, P.A. Green, E.A. Holland, D.M. Karl, A.F. Michaels, J.H. Porter, A.R. Townsend, and C.J. Vöosmarty. 2004. Nitrogen Cycles: Past, Present, and Future. Biogeochemistry 70:153-226. Gilland, B. 2002. World population and food supply – can food production keep pace with population growth in the next half-century? Food Policy 27:47-63. Ladha, J.K., D. Dawe, H. Pathak, A. T. Padre, R. L. Yadav, Bijay Singh, Yadvinder Singh, Y. Singh, P. Singh, A. L. Kundu, R. Sakal, N. Ram, A. P. Regmi, S. K. Gami, A. L. Bhandari, R. Amin, C. R. Yadav, E. M. Bhattarai, S. Das, H. P. Aggarwal, R. K. Gupta and P. R. Hobbs. 2003. How extensive are yield declines in long-term rice–wheat experiments in Asia? Field Crops Research, Volume 81, Issues 2-3, 20 February 2003, Pages 159-180. Magen, H. and P. Imas. 2006. Characteristics of potassium fertilization and demand. In: Benbi, D.K., Brar, M.S. and Bansal, S.K. (eds.). Balanced Fertilization for Sustaining Crop Productivity. Proceedings of the International Symposium, Ludhiana, India, 22-25 November 2006. ISBN 978-3-9523243-2-5. Mullen, K., Orden, D. and Gulati, A. (2005). Agricultural policies in India. MTID discussion papers 82, International Food Policy Research Institute (IFPRI).


Tenkorang, F., and J. Lowenberg-DeBoer. 2009. Forecasting long-term global fertilizer demand. Nutr Cycl. Agroecosyst. 83:233–247. Tilman, D., et al. 2001. Forecasting Agriculturally Driven Global Environmental Change. Science, Vol. 292. Yamada, T. (2006). Potafos Annual Report. IPI-PPI-PPIC joint mission Brazil.


International Potash Institute Optimizing Crop Nutrition

Current World Potash Situation & Future Outlook AFA International Annual Fertilizers Forum & Exhibition, February 2-4, 2010 Cairo Semiramis Intercontinental Hotel, Cairo, Egypt Hillel Magen, Director ipi@ipipotash.org

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International Potash Institute Optimizing Crop Nutrition

Food security is on the agenda Malawi Can it feed itself? An expensive fertiliser subsidy delivers a bumper harvest—but at what cost? 1 May 2008 From The Economist print edition Food and agriculture How to feed the world Nov 19th 2009 From The Economist print edition Business as usual will not do it Feeding the world If words were food, nobody would go hungry Nov 19th 2009 | ROME From The Economist print edition Investment in agriculture is soaring. So, worryingly, is distrust of markets and trade

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International Potash Institute Optimizing Crop Nutrition

Food security •

G8: Agriculture and food security has become the “…core of the international agenda”

World Bank in 2009: +50% budget for agriculture.

The Islamic Development Bank is creating an Ag department for the first time.

Need for 1) higher productivity and 2) access to markets.

Impact of fertilizer subsidies (Malawi): in 2005, 40% of food was imported, in 2009, it will export 50% of its production. 3

International Potash Institute Optimizing Crop Nutrition

This presentation •

Past and actual potash consumption

Main growth engines for potash consumption

Future requirements and challenges

Conclusions

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International Potash Institute Optimizing Crop Nutrition

N, P, K and K:N ratio 1960-2010(f) 0.9

120,000

0.8

80,000

N

K2O:N

0.7 0.6

60,000 0.5

K2O:N ratio

Nutrient ('000 mt)

100,000

P2O5

40,000

0.4

K2O

20,000

0 1961/62 1966/67 1971/72 1976/77 1981/82 1986/87 1991/92 1996/97 2001/02 2006/07

0.3 0.2

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Forecasts by IFA, Nov. 2009

International Potash Institute Optimizing Crop Nutrition

Questions • In which crops? • Where? • Why?

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International Potash Institute Optimizing Crop Nutrition

The rise of cultivation of oil crops and fruit and veg. 1990-2008 Oilcrops

|--------------------Soybean---------------------|

|-Oil palm-|

…7 |------------China-----------|

Fruit & Veg.

0m illi

on ha b

y5 0k

gK

2O

Roots & tubers

ha -1…

Pulses

<=====But decrease in developed and increase in developing countries

Cereals

0

10

20

30

40

50

60

70

80

90

Change in cultivated land (million ha)

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FAOSTAT, 12-2009

International Potash Institute Optimizing Crop Nutrition

Mapping additional potash consumption by crop and region (per year) Market

Crop

Potash market size

Projected growth rate of main crops

Addition K consumption (9)

‘000 mt K2O

% per annum

‘000 mt K2O

Asia

Rice (paddy)

1,800(1)

4(2)

72

Malaysia & Indonesia

Oil palm

1,070(3)

8.5(4)

90

Brazil

Soybean

1,716(5)

5.0(6)

86

China

Vegetables

2,330(7)

8.6(8)

200

India

Fruit & vegetables

640(7)

6.2(9)

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Total

7,556

487

of world

29%

49%

(1) Dobermann and Dawe, 2000; (2) Witt et al., 2002; (3) Fairhurst and Witt; 2005; FAO, 2002; (4) Production growth rate 1990-2005 Magen and Imas, 2006. IPI proceedings; IPI-PAU Int. Symp. was 8.5% pa. This is assumed to continue; (5) Yamada, 2006; (6) Production growth rate 1990-2005 was 7.6% pa. 5% is a http://www.ipipotash.org/publications/detail.php?i=238 modest assumption; (7) FAO, 2002; (8) Production growth rate 1990-2005 was 8.6% pa. This is assumed to continue; (9) Mullen et al., 2005.

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International Potash Institute Optimizing Crop Nutrition

But at the same time, some sectors are under-fertilized

+K

-K

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International Potash Institute Optimizing Crop Nutrition

P and K balances in 33 LTE in India and China

P; K balance (kg ha-1 yr-1)

80 70

100

60 50

50 40

0

30

12

20 10

39

9

3

3

-100

0 -10

34

-50

6

9

15

3

16

15

6

3

-150

-20 -200

……………………% of LTE …………………… “…The causes of yield decline are mostly location-specific but depletion of soil K seems to be a general cause. In over 90% of the LTE, the fertilizer K rates used were not sufficient to sustain a neutral K input-output balance”. Adapted from Ladha et al., 2003. How extensive are yield declines in long-term rice-wheat experiments in Asia?

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International Potash Institute Optimizing Crop Nutrition

Annual K balances (kg K ha-1 yr-1) for 11 years of grass in Sweden, 1970-80

Grass

K=0

K=65 kg ha-1 yr-1

Input Deposition

0

66.5

1.4

1.4

Leaching

0.8

2.3

Harvest

66.6

128.4

K mass balance

-66.0

-64.3

K conc. (%DM)

0.71-0.75

1.00-1.48

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Source: Oborn, I. 2009. IPI-OUAT-IPNI symposium, India, 2009.

International Potash Institute Optimizing Crop Nutrition

Potassium balances in field experiments on corn in 2005 and 2006 in North China Plain K balance (kg ha-1, K2O)

Shuitun

Dajin

Qingyuan1

100 50

Qingyuan2

Laiyang

Qingyuan

Zhengding

60.0 10.0

0 -40.0

-50 -100

-90.0

-150 -140.0

-200 -250

-190.0

-300

-240.0

-350

K0

K1

K2

Farmers practice High yielding practices 12 Source: Niu et al.; IPI-CAU experiment in NCP. In press.

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International Potash Institute Optimizing Crop Nutrition

Declining available K in soil (India) Crop rotation: cluster bean, mustard and pearl millet rotation

Available K (kg K2O/ha)

170

(85 ppm)

160 150 140 K=0 K=20 K=40 K=60

130 120

(67 ppm)

110 100 2002

2003

2004

2005

2006

2007

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Source: Yadav et al. IPI-CCS HAU project in Haryana, India. Annual report 2008.

International Potash Institute Optimizing Crop Nutrition

Effect of cropping system on K balance (all calculations with no K fertilizer added) Rice Rice: 40% CR returned; 25 kg K2O ha in irrigation water

K balance (kg K2O/ha/yr)

0 -50 -100

Rice Wheat: 15% CR returned; 5 mt/ha of wheat; 85 kg K2O in irrigation water

-150 -200 -250 3

4

5

6

7

Rice yield (mt/ha)

Source: Adapted from Buresh, IPI-OUAT-IPNI symposium, India, 2009.

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Rice Maize: 15% maize and 40% rice CR returned; 12 mt/ha maize; 35 kg K2O in irrigation water 14

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International Potash Institute Optimizing Crop Nutrition

Diverse picture: K is consumed more, but in many crops, the K balance is negative

Hybrid rice in China…oil palm in Malaysia 15

International Potash Institute Optimizing Crop Nutrition

Future

Technology…and management! 16

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International Potash Institute Optimizing Crop Nutrition

Projected consumption of main crops and commodities in 2030 and 2050

Production (million mt)

2,000 1999/01 2030 2050

1,600 1,200 800 400 0 Wheat

Rice

Coarse grain

Meat

Milk

Oil crops (oil equiv.)

Main crops and commodities

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Source: FAO, 2006. World agriculture: towards 2030/2050. Rome.

International Potash Institute Optimizing Crop Nutrition

Projected consumption of vegetable oil in 2030 and 2050

120 2000 2030 2050

Million oil Million mt mt oil

100 80 60 40 20 0 Soybean

Oil palm

Source: FAO, 2006. World agriculture: towards 2030/2050. Rome.

Rapeseed

Sunflower

Other

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International Potash Institute Optimizing Crop Nutrition

Harvested land in developing countries: changes from 1997/99 to 2030 1997-99 2015 2030

Groundnut

Soybean

Sugar cane

Maize

Rice

Wheat

0

20

40

60

80

100

120

140

160

180

Million ha

19 FAO, 2002. World agric towards 2015/2030

International Potash Institute Optimizing Crop Nutrition

Where to deliver FBMP?...in Africa, too. MIM project by IFDC (supported by IPI, IPNI & TSI)

20 IFDC report Mozambique project 12/2008

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International Potash Institute Optimizing Crop Nutrition

So much can be done: high and low ends

Crop

Rice

Wheat -1

Global ave. Country ave. Top 5 highest yields(1)

Large producers with low yields

Indonesia Spain Uruguay US Australia Egypt Cambodia Pakistan India Myanmar Bangladesh

mt ha 4.08 4.60 7.08 7.28 7.71 8.50 9.99 2.33 3.12 3.15 3.74 3.75

Maize -1

US UK NZ Belgium Netherlands Ireland Kazakhstan Russia Turkey Ukraine Pakistan

mt ha 2.83 2.80 7.76 7.83 8.25 8.43 8.85 1.05 1.93 2.23 2.47 2.52

Potato -1

China US Spain Austria Greece Chile Nigeria India Philippines Mexico Indonesia

mt ha 4.80 5.14 9.41 9.68 10.11 10.19 10.86 1.66 2.05 2.22 2.94 3.43

-1

India France Netherlands US Belgium NZ Russia Ukraine China India Poland

mt ha 16.78 17.02 42.71 42.94 43.37 43.85 45.84 12.22 12.85 14.15 17.02 18.18

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Average of five years, 2003-2007; Source: FAOSTAT, July 2009; presented at the FBMP symposium in Piracicaba, Brazil.

International Potash Institute Optimizing Crop Nutrition

Nitrogen actual consumption till 2009 and future to 2050 estimations by various sources 250.0

N consumption (million mt)

225.0

Tilman et al , 2001, (236 million mt N)

Dobermann and Cassman, 2005

200.0

Gilland, 2002 (165 million mt)

175.0 150.0

Linear trendline

IFA Nov. 2009

125.0 100.0 75.0

Tenkorang et al ., 2009

Gallowy et al ., 2004 Tenkorang et al., 2008 (approx 135 million mt)

50.0 25.0 1992/93

2001/02

2010/11

2019

2025

2028

2037

2046 2050

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International Potash Institute Optimizing Crop Nutrition

Nitrogen-use efficiency, the next green revolution? (The Economist Nov 13 2009)

Imagine you could wave a magic wand and boost the yield of the worldâ&#x20AC;&#x2122;s crops, cut their cost, use fewer-fossil fuels to grow them and reduce the pollution that results from farmingâ&#x20AC;Ś Imagine, too, that you could both eliminate some hunger and return some land to rain forest. This is the scale of the prize that many in the biotechnology industry now suddenly believe is within their grasp in 2010 and the years that follow. They are in effect hoping to boost the miles-per-gallon of agriculture, except that the fuel in question is nitrogen.

Science The new NUE thing The World in 2010 print edition By Matt Ridley Nitrogen-use efficiency, the next green revolution

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International Potash Institute Optimizing Crop Nutrition

Hypothetical potassium consumption scenarios in relation to N consumption N Nutrient consumption in 2005 (million mt) K:N ratio 2005

Projected consumption in 2050 (million mt) Nitrogen

P2O5

K2O

97.9 37.6

27.1

1

0.28

150

Potassium scenario 1: NK ratio 1:0.28 (as in 2005)

42

Potassium scenario 2: NK ratio 1:0.35

52

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International Potash Institute Optimizing Crop Nutrition

Total nutrients & K use by crops – percent in 2007 Other Crops Fruit & Veg. Sugar Crops

KK:(%) % of total K Total nutrients (%)

Cotton Other OS Oil Palm Soybean Other CG Maize Rice Wheat

Oil Crops Cereals 0

10

20

30

40

50

60

Percent

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Adapted from Heffer, 2009. Assessment of Fertilizer Use by Crop at the Global Level 2006/07 – 2007/08. IFA.

International Potash Institute Optimizing Crop Nutrition

K use by crops – Mio mt in 2007 and 2050(f) Data for 2050, in a BAU model: • K demand for cereals, oil and sugar crops was factored by the FAO production forecasts (70, 200, 115 percent, respectively(1)) • Fruit & Veg. factored by 150 percent (conservative)

Other Crops Fruit & Veg. Sugar Crops Cotton

K 2050 (mio mt) K 2007 (mio mt)

Other OS Oil Palm Soybean Other CG Maize Rice

But things may change: • Nutrient cycling • Biotech • Limited prophecy…

Wheat

Oil Crops Cereals

0

2

4

6

8

10

12

14

16

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Mio mt K2O (1) Adapted from FAO, 2006. Data for 2007 adapted from Heffer, 2009. Assessment of Fertilizer Use by Crop at the Global Level 2006/07 – 2007/08. IFA.

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International Potash Institute Optimizing Crop Nutrition

Concluding remarks •

Potassium requirements needs to be met by economical replenishing of K removed

Future needs for food = more nutrients applied, mostly in regions with under-optimal production levels

K will play a greater role in sustaining food security, in particular in the production of oil crops and fresh vegetables and fruit

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International Potash Institute Optimizing Crop Nutrition

IPI publications in Arabic…log to IPI and AFA websites

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International Potash Institute Optimizing Crop Nutrition

Acknowledgment; IPI Coordinators

Central Europe, Ukraine and the Baltic States

T. Popp

Head office

H. Magen

West Asia

China

North Africa

M. assaraf

M. Marchand Latin America

India, Bangladesh and Sri Lanka sub-Saharan Africa International Rice Research Consortium (IRRC)

A. Naumov

T. Baladzhoti G. Ebert

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International Potash Institute Optimizing Crop Nutrition

Thank you

Š Copyright 2005

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