Recipe for Famine: Up the price of fertilizer

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How Famine Lurked Behind Vienna Toast Where Joe Cocker Crooned

Collusion Alleged
Manmade causes helped spur the food shortages that the World Bank says left 967 million of the world’s 6.7 billion people undernourished this year. The recipe for famine included government policies, speculation in commodities markets and a failure to invest in agriculture. Now the cost of potash may help bring the world a fresh bumper crop of hunger.
In eight federal lawsuits since September, six potash producers that do business in the U.S. have been accused of colluding to raise prices and limit supply. Four of the defendants -- Potash Corp. of Saskatchewan Inc., Mosaic Co., Agrium Inc., and Uralkali -- say the cases have no merit. Silvinit said it is waiting to see which courts will hear the cases before it comments while Belaruskali said that Anatoly Makhlai, deputy director for ideology, wasn’t available to comment.
Fourfold Increase
The cases all involve class-action claims. Plaintiffs include Minn-Chem, Inc., a farm chemicals supplier based in Sanborn, Minnesota; Gage’s Fertilizer & Grain Inc. of Stanberry, Missouri; Kraft Chemical Co. of Melrose Park, Illinois; Westside Forestry Service Inc. in Novi, Michigan; Wabaunsee County, Kansas-based Feyh Farm Co.; William Coaker Jr., a farmer in Leakesville, Mississippi; Gordon Tillman, a farmer in Wildwood, Florida; Shannon Flinn, a farmer in Santa Rosa County, Florida; and Kevin Gillespie, who was described by his lawyer, Craig Essenmacher, as an “end user” based in Grand Traverse County, Michigan.
Earnings for Uralkali, based in Berezniki in central Russia, will climb fourfold this year on the higher prices and 9.3 percent in 2009, according to Merrill Lynch & Co. estimates. Competitors including Potash Corp. and Israel Chemicals Ltd. of Tel Aviv have followed suit on prices.
Producers raised fees in 2007 and 2008 as demand grew from farms in developed countries, which were trying to elevate crop yields after grain prices climbed. The cost of both food and potash kept rising, putting the nutrient out of reach for some family operators and cooperatives in developing nations.
Brazil, India, China
Farmers in Brazil, India and China had under-applied potash and depleted the soil for years by then -- further fueling demand, said Bernard Brentnall of Fertilizer & Chemical Consultancy, an advisory firm in Hampton Hill, England. Global potash production from 2005 through 2007 rose 6.1 percent, according to the U.S. Geological Survey.
“There are no substitutes for potash,” said Stephen Jasinski, a commodity specialist at the U.S. Geological Survey, the science agency for the Interior Department, in a Nov. 24 e- mail. Alternatives don’t provide the nutrient in the quantities needed “for intensive farming,” he wrote.MORE