馃攳
The CEO of one of the world's largest fertilizer producers on the growing global food crisis - YouTube
Channel: CNBC Television
[0]
i'm not sure a lot of people and why
[1]
would they by the way knew
[3]
that when they hear fertilizers you
[5]
probably know what they're thinking
[6]
about not realizing that these are
[8]
chemical ureas phosphates nitrates made
[11]
of things like ammonium nitrate ammonia
[14]
natural gas
[16]
how hard has your industry been hit
[19]
macro
[21]
by the spike in natural gas
[23]
and all the changes on the underlying
[25]
chemicals that go into your product
[30]
well thanks for having me brian uh and
[32]
and i'm deeply disturbed by the horrific
[35]
events that are unfolding in ukraine and
[38]
i'm strongly condemning the russian
[40]
military in innovation there
[43]
and as you say in in addition to the
[45]
immediate suffering that we're
[46]
witnessing in ukraine right now we're
[48]
also moving into a globe global food
[51]
crisis and this will make
[53]
food more expensive for
[55]
all of us
[56]
but for most most vulnerable this is
[58]
really a question of uh life or or or
[61]
death and the reason for is it it's all
[64]
connected here because
[65]
ukraine and russia are world powers in
[67]
the food system together they represent
[70]
the one-third of
[72]
global wheat exports there it's about 80
[74]
percent of sunflower oil essential for
[77]
cooking large in maize and on top of it
[80]
it comes
[82]
fertilizer russia is a major producer of
[85]
fertilizers nitrogen phosphate and and
[88]
potash and
[90]
also the
[91]
natural gas that is used to produce
[94]
nitrogen fertilizer in europe 40 of the
[96]
gas comes from from russia and
[99]
when we know that half of the world's
[101]
population gets its food because of
[104]
mineral fertilizer it all adds up to a
[106]
very very
[108]
difficult situation
[111]
it is and we have seen it get so
[113]
difficult sven i don't need to tell you
[114]
this that there have been production
[116]
shutdowns of some chemical fertilizers
[119]
because they either can't get certain
[121]
products or it's simply too expensive
[123]
and you could never sell the fertilizer
[125]
for the input costs are you guys
[127]
actively producing fertilizer right now
[130]
well it's an extremely volatile market
[133]
uh right now and
[135]
we've had shutdowns uh even before uh
[138]
the war as a result of
[140]
the increased energy prices that we saw
[143]
towards the end of the summer last year
[145]
and then
[146]
it reached a a peak in in the beginning
[149]
of uh march with the natural gas prices
[152]
in europe getting up to
[155]
ten hundred and twenty dollars so we're
[156]
talking about the
[157]
six hundred dollars per uh barrel of oil
[160]
equivalent and then it's difficult to
[163]
produce just about anything at a at a
[165]
reasonable
[166]
return so we had to uh to make shutdown
[168]
since then uh natural gas prices have
[171]
gone down down somewhat in uh
[173]
in in europe uh and and fertilizer
[175]
prices have gone up so at the moment
[177]
we're
[178]
producing at uh capacity in
[181]
in europe but it is very volatile and
[183]
we're monitoring this uh day by day
[185]
really brian
[188]
okay but you are product producing at
[190]
capacity right now which i think is is
[192]
good news is demand for fertilizer
[195]
inelastics then i mean in other words
[198]
it was at 250 or 300 us dollars a metric
[201]
ton now it's in some cases i'm hearing
[203]
quotes of you know 14 1500
[207]
farmers are going to buy it because if
[208]
they don't have crops they don't have a
[210]
business but at some point they have to
[212]
sell the product for more than their
[213]
input costs
[215]
is demand
[216]
inelastic or will people cut back on
[219]
using it
[221]
well it's hard to to think of a more
[224]
essential good than food and
[227]
when half of the food in the world is
[229]
produced as a result of fertilizer
[231]
certainly
[232]
there is a demand for for the product
[234]
but uh
[236]
you know farmers are put in in a very
[237]
difficult position as as well with all
[239]
the uncertainties and
[241]
volatility is here with fertilizer
[244]
prices being at record highs it's uh
[246]
it's it's also about having the credit
[248]
so even if it makes financial sense are
[250]
they able to take on the risk to the
[252]
credit lines and and so on and it's
[254]
important that we we do whatever we can
[257]
to
[258]
support and it takes some time to before
[260]
it's reflected in the food prices as
[262]
well so that the crops justify the use
[264]
of
[266]
fertilizer and what we've seen you know
[268]
the first phase a lot of focus has been
[270]
on the cost of energy
[273]
but
[274]
why do we eat food while it is to get
[276]
energy right so it's all connected it
[278]
takes a bit more time before it's
[279]
reflected in the food prices we saw
[281]
all-time high food prices in in february
[284]
before the invasion now it's up another
[286]
12 and a half percent in
[289]
in march uh we certainly helped with
[291]
farmer economics
[294]
but indeed volatile and a lot of
[296]
uncertainty at the moment
Most Recent Videos:
You can go back to the homepage right here: Homepage