The last few years have been challenging for anyone sourcing commodities and feedstocks. We’ve all faced acute disruption in commodity supply chains from the COVID-19 pandemic and Russia’s invasion of Ukraine.
Our client wanted to better manage their exposure to changes in the fertilizer market. We were tasked with outlining the current dynamics of the Southeast Asian fertilizers market, assessing the risks to supply and developing a price risk management action plan.
CZ Approach
We used in-house and external data sources to:
- Quantify regional fertilizer trade flows and major exporters/importers.
- Model fertiliser prices and track historical costs.
- Develop hedging strategies.
CZ Solution:
We conducted an in-depth analysis of the Southeast Asia fertilizer market, encompassing key importers, exporters, and trade flows. We also looked at fertilizer availability, cost structure, pricing trends, and hedging strategies. This comprehensive analysis was presented in a detailed written report, accompanied by all supporting data and expert insights from our commodities analysts.
Outlook
The fertilizer market in Southeast Asia is heavily reliant on supply and price factors determined outside of the region itself. Many importers in the region source fertilizers from the spot market, making them susceptible to price fluctuations. This vulnerability has been compounded by recent political events in major trading regions like China and Russia. While hedging instruments are available to mitigate risk, many of these instruments lack liquidity, leaving many buyers vulnerable to forces beyond their control.
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