New Ross fertilizer group
announces
price deal
A lbatros
Fertilizers Ltd., one of the major Irish blenders, has
announced new fertilizer prices, which will have a significant
effect on farming input costs. Due to a doubling of energy
costs and a decision by European manufacturers to severely cut
production, bringing supply in line with demand, Irish farmers
will face increases of 30 to 40 per cent in the next few
weeks.
James Kennedy, who has recently taken over as
Group Chief Executive of the Thomas McDonogh Group, owners of
Albatros Fertilizers Ltd., New Ross, Co. Wexford, said there
was no avoiding the new reality of the market in which
production has been cut back and oil and gas prices the major
component of fertilizer manufacturing costs have risen to
record levels.
The British industry has already
established a new pricing structure to reflect the dramatic
changes in the market - product is currently costing up to 30
per cent more in Northern Ireland than in the Republic.
British farmers have also accepted that this price will
increase progressively each month to April next.
Gerald
Bonington of Norsk Hydro, the biggest producer of fertilizers
in Western Europe, commenting on the European market, said
that over the past 12 months in the UK, the price of nitrogen
fertilizer has gone up by 50 per cent. While Irish prices had
moved upwards in the 2000 season, the increase did not reflect
the current market conditions in the UK and
Europe.
"The expectation in the UK is that prices will
increase between now and next April by another 15 per tonne,"
says Mr. Bonington. "Prices have already risen by 10 a tonne
since July and that structure has become well
established."
In relation to Albatros and the Irish
market, Mr. Kennedy said the new reality was that:
*
Main European producers of blend components and straight
nitrogen products have closed four million tonnes of
production capacity in the past year, bringing the supply and
demand situation into balance, which has resulted in major
price increases
* Oil and gas prices have increased by
100 per cent over the past eighteen months and energy costs
constitute a major portion of the cost of fertilizers
*
The US dollar has increased in value by 15 per cent against
the IR in the past year and added significantly to the cost of
fertilizers
* Domestic haulage rates have also
increased considerably during the past year as a result of oil
prices.
"Albatros Fertilizers remain committed to
maintaining price competitiveness and ensuring that Irish
farmers get the best possible value for money in the current
circumstances," said Mr. Kennedy.
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