Phosphate rock prices inched up in the week ended April 15, 2016. Phosphate rock is one of the main input materials required for manufacturing phosphate fertilizers such as DAP (diammonium phosphate) and MAP (monoammonium phosphate).
It’s important for companies such as Mosaic (MOS), PotashCorp (POT), Israel Chemicals (ICL), and Agrium (AGU) to track phosphate rock prices. It takes about 1.6–1.7 metric tons of phosphate rock to produce a single metric ton of DAP, according to Mosaic.
The average price of phosphate rock for the week ended April 15, 2016, fell to $114 per metric ton from $113 per metric ton in the previous week. Phosphate rock’s price oscillated between a low of $97 per metric ton and a high of $132 per metric ton last week.
Morocco is the largest producer of phosphate rock. According to the International Fertilizer Industry Association, Morocco’s share of global phosphate rock production was 49% in 2011.
Prices are still lower
Phosphate rock prices have fallen over the last year. In the corresponding week a year ago, the average phosphate rock price was $124. With downward pressure on phosphate fertilizer prices and concerns over phosphate’s price outlook, companies have recently curtailed production.
You can invest in Mosaic through the SPDR S&P North American Natural Resources ETF (NANR), which invests about 1.6% of its portfolio in Mosaic.
In the final part of this series, we’ll look at potash fertilizer prices, especially MOP (muriate of potash).