Last week, the fertilizer affordability showed some positive momentum week-over-week. The Fertilizer Affordability Index fell slightly from 0.71x to 0.7x.
Reading the index
The Fertilizer Affordability Index is issued by the Mosaic Company (MOS). It is indexed to one in the base year of 2005. A level below one means that fertilizers are affordable relative to the base year, and a level above one means that fertilizers are expensive relative to the base year.
So, the current affordability index level of 0.7x means that the fertilizers are fairly affordable. However, the affordability index has been rising since mid-2017 as we can see in the above chart. This is partly due to the gradual rise in some of the key NPK (nitrogen, phosphorous, and potassium) fertilizers, which we’ve discussed in the earlier parts of this series.
These companies are set to announce their earnings in the coming month. For the latest updates, visit our Agricultural Fertilizer page.