outlook for agriculture and fertilizer demand in the ... · fodder maize 8% other feed crops 2%...

Dmitry Magazanik

EuroChem

Outlook for agriculture and fertilizer

demand in the Russian Federation

2

Area and climate

Outlook for agriculture

Total area of Russia is

17.1 million km2

• largest country in the world;

• covers more than 1/8

of the Earth’s inhabited land area;

• multiple climate zones;

• over 2 million rivers;

• most freshwater resources

are contained in the permafrost.

3

Agricultural area; planted area dynamics


Structure of agricultural area*

13% of the total area in the country

Arable land

7% of the total area

* - as of 1 January, 2017;

** - all household categories

Planted area dynamics in 2005-2017, M Ha**

CAGR in

2012-2017, %

1.1%

1.4%

4.3%

Planted area in 2017: 81 M Ha

• Grains and legumes: 59%;

• Feed crops: 20%;

• Industrial crops: 17%;

• Potatoes, vegetables, melons: 4%.

Source: Federal State Statistics Service of the Russian Federation, Ministry of Agriculture of the Russian Federation

Arable land55%

Pastures31%

Hay meadows11%

Permanent crops

1%

Idle land2%

0

20

40

60

80

100

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

Total planted area Grains and legumes Industrial crops

4

Structure of planted area in Russia


Grains and legumes

Source: Federal State Statistics Service of the Russian Federation

Industrial crops

Feed crops

Perennial grass65%

Annual grass25%

Fodder maize8%

Other feed crops

2%

Winter wheat31%

Spring wheat27%

Spring barley16%

Grain maize6%

Oat6%

Buckwheat4%

Winter rye3%

Other grains and legumes

7%

Sunflower seeds57%

Soybeans19%

Sugar beet9%

Rape7%

Other industrial crops

8%

5

Yield of crops


Krasnodar region

2000: 3.4

2017: 6.2

Yield of various crops in 2000-2017, t/Ha(all household categories)

Winter wheat yield in different regions,

t/Ha

Tula region

2000: 2.8

2017: 5.9

Leningrad region

2000: 1.2

2017: 2.7

Source: Federal State Statistics Service of the Russian Federation

1,6

3,1

1,62,2

1,7

2,6

0,91,4

10,5

15,614,3

23,6

0

5

10

15

20

25

2000 2005 2010 2015 2017

Wheat Rye Barley Oilseeds Potatoes Vegetables

6

Cultivated area and grain production


Over a ~40-year period production effectiveness

increased more than 2.5 times.

Grain production in 1978 and 2017 Key drivers

of agricultural development:

• implementation of new resource efficient

customized technologies;

• irrigation expansion;

• growing greenhouse area;

• agriculture biologization and greening;

• more complex mineral nutrition

within increasing fertilizer consumption.

Source: Ministry of Agriculture of the Russian Federation

0

50

100

150

USSR, 1978 Russia, 2017

Planted area, M Ha Grain production, M t

7

Implementation of new technologies: Agricultural Lands Atlas

Key drivers for agriculture development

Agricultural Lands Atlas (ALA)

• created by order of Ministry of Agriculture

of the Russian Federation;

• consists of four main parts:

• Survey field data collection system based on GNSS receivers and Mobile GIS platform;

• Storage of remote sensing data serve as the basis for agricultural land mapping

and automated interpretation of vegetation condition;

• Agricultural lands geodatabase used for automatic update of the central storage

by exchanging data with agrochemists;

• Web-interface (geoportal) designed for data publication.


8

Implementation of new technologies: satellite crop monitoring and subsoil fertilizer application


Liquid fertilizers (UAN, APP, complex/NPK(S) grades)

become more widely used.

Satellite crop monitoring New technologies for fertilizer

application latest developments in domestic agricultural machinery

• connected with implementation of:

• flying drones;

• software for optimization of agricultural processes;

• allows to conduct:

• interactive mapping;

• relief 3D models development;

• NDVI measurement;

• phytosanitary control.

9

Implementation of new technologies: alternative soil cultivation


Modern tillage practices:

• No-till (zero tillage or direct drilling)

way of growing crops without disturbing the soil through tillage;

• Mini-till (minimum tillage)

based on soil preparation for sowing by disk working organs;

• Strip-till

• combines no-till and conventional tillage;

• disturbs only the portion of the soil that is to contain the seed

row.

Alternative soil cultivation is becoming more common in Russia: currently representing more than 1 M Ha.

10

Implementation of new technologies: irrigation expansion



Irrigated land dynamics in 1990-2017*,

M Ha

Improvements in Russia

• total area: 11 M Ha (as of 1 January, 2017)

(including ~5 M Ha of irrigated land);

• 9% of arable land;

• contributes ~15% in gross agricultural output:

• all rice-cultivated area;

• 70% of grown vegetables;

• more than 20% of feed crops;

• allows to increase productivity:

• potato: twice;

• grains: three times and more;

• perennial grass: 3.5 times.

6,2

4,7

4,0

4,5

5,0

5,5

6,0

6,5

1990 1995 2000 2005 2010 2015 2017

* - as of the beginning of each year

11

Implementation of new technologies: growing greenhouse area


Source: “Greenhouses of Russia” Association

Structure of greenhouse production

in 2017

0

1

2

3

4

2000 2005 2010 2015 2017 2020

Cucumber66%

Tomato31%

Other agricultural crops

3%

Greenhouse dynamics in 2000-2020,

thousand Ha

12

Implementation of new technologies: agriculture biologization and greening


Current dynamics in agriculture biologization:

• growing interest in microbial products, particular attention focused on biological soil components

(soil microflora, its composition and activity);

• nationwide introduction of uniform standards for biological and organic farming;

• BIO fertilizer application (microbial products, humates, etc.);

• implementation of “green” technologies (crop residue recycling, use of siderates);

• certified organic agriculture (adoption of ameliorants and products for organic production);

• recultivation of abandoned, saline and eroded agricultural lands.

13

Implementation of new technologies: complex mineral nutrition


2010 2017

Structure of mineral fertilizer supplies for agriculture(calculated from nutrients)

By now the structure’s:

• become more balanced;

• enriched with value added products (liquid, water-soluble, enhanced efficiency fertilizers).

Source: Azotecon, EuroChem’s estimation (based on data by Ministry of Agriculture of the Russian Federation and Russian Fertilizer Producers Association)

Ammonium Nitrate

45%

NPKs32%

MAP 12%

Urea4%

MOP3%

UAN>1%

Other fertilizers4%

Ammonium Nitrate

41%

NPKs26%

MAP 18%

Urea5%

MOP1%

UAN4%

Other fertilizers5%

14

0

2

4

6

8

10

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

N P2O5 K2O

Implementation of new technologies: growing fertilizer consumption


Dynamics of fertilizer supplies

for agriculture in 1991-2017,

M t of nutrients

Source: Federal State Statistics Service of the Russian Federation, Azotecon, EuroChem’s estimation

Average fertilizer application,

kg nutrients per Ha of crops

1719

25

3842

55

0

10

20

30

40

50

60

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

15

Russian Federation in the global fertilizer industry

Mineral fertilizer industry

Share of Russian companies

in global fertilizer capacities, %

Source: EuroChem’s estimation (based on data by Russian Fertilizer Producers Association and consulting companies)

Share in global production, %

Share of Russian

Federation in 2017, %

Ammonia

Urea

Ammonium Nitrate

UAN

MAP

DAP

MOP

9%

4%

21%

10%

13%

3%

18%

Product

0% 5% 10% 15% 20% 25%

CAN

DAP

Urea

Phosphoric Acid

Ammonium Sulphate

Ammonia

MAP

UAN

MOP

FGAN

16

Production of mineral fertilizers


Dynamics of fertilizer production in 1991-2017, M t of nutrients

Structure of fertilizer production in Russia1991 2009 2017

Source: Azotecon, Federal State Statistics Service of the Russian Federation

0

5

10

15

20

25

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

N P2O5 K2O

N44%

P2O529%

K2O27%

N53%

P2O519%

K2O28%

N47%

P2O518%

K2O35%

17

Structure of fertilizer production in 2017


Nitrogen fertilizers

Source: Azotecon, Russian Fertilizer Producers Association, EuroChem’s estimation

Phosphate fertilizers

* - calculated from K2O

NPK fertilizers*

Urea36%

Ammonium Nitrate

27%

UAN7%

Stabilized Ammonium

Nitrate3%

Ammonium Sulphate

3%

CAN1%

Other N-containing fertilizers

23% MAP42%

DAP14%

NP4%

APP2%

Other P-containing fertilizers

38%

NPK 16:16:16/15:15:15

39%

NPK 10:26:2622%

NK grades2%

Blends1%

Other NPK grades

36%

18

Export of mineral fertilizers


Dynamics of fertilizer exports, M t of nutrients Export share of sales in 2017, %

Nitrogen

Phosphate

Potash

Source: Azotecon, Federal State Statistics Service of the Russian Federation, EuroChem’s estimation

Export structure in 2017

0

5

10

15

20

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

N P2O5 K2O

N38%

P2O515%

K2O47%

Export78%

Export96%

Export77%

19

National fertilizer development plan


Main 2025 targets:

• to increase fertilizer production by 35% (compared to 2016) up to 28 M t nutrients;

• to raise export share of output up to 75% (vs 71% in 2016);

• to increase average fertilizer application by 23% (to 60 kg nutrients per Ha of crops).

2020 2025

Production, M t of nutrients 20,8 24,1 28,0

including N 9,5 11,7 12,3

P2O5 3,6 3,8 4,0

K2O 7,8 8,6 11,7

Export share of output, % 71 75 75

including Nitrogen fertilizers 63 65 65

Phosphate fertilizers 80 80 78

Potash fertilizers 87 88 89

Average fertilizer application, kg nutrients/Ha 48,8 54 60

Parameter 2016Target indicators

Thank you

outlook for agriculture and fertilizer demand in the ... · fodder maize 8% other feed crops 2%...

Documents