SEASONAL MARKET


TRENDS UPTURNED. Increasingly warmer weather that can ease natural gas prices typically coincides with the end of the spring fertiliser application season and key growing stages of crops in the UK. By summer, applications for cereal crops are completed. This allows for what had been marketed in UK agriculture as a ‘New Season Reset’ where fertiliser manufacturers that need to produce 365 days a year 24/7 (or face high restart costs for plants) can build sales books for next year’s crop requirements. The UK natural gas cost increased 317% between April 2021 and September 20211


. European Gas maintained higher


prices through this period as well, and demand for forward sales were muted from the farm gate. By August, (the height of harvest in most of Europe) farmers’ attention was on harvesting old crop, as opposed to contemplating purchasing next year’s crops nitrogen requirements which were being marketed above 5 year norms. By September, following 4 weeks of subdued sales through harvest and scheduled maintenance of fertiliser production facilities, key nitrogen fertiliser manufacturers across the continent began curtailing production beyond their scheduled maintenance due to unprecedented costs that continued to unfold.


1 Natural Gas Futures Historical Prices - Investing.com UK


THE UK NATURAL GAS COST INCREASED 317% BETWEEN APRIL 2021 AND SEPTEMBER 2021. EUROPEAN GAS MAINTAINED HIGHER PRICES THROUGH THIS PERIOD AS WELL, AND DEMAND FOR FORWARD SALES WERE MUTED FROM THE FARM GATE.


16 | ADMISI - The Ghost In The Machine | Q1 Edition 2022


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