Key words of the passage: fertilizer; drop; needs; price

Fertilizer prices, which had hit records, are tumbling as buyers recover from the shock, but that doesn't mean the market contraction is over.

The June spot price in Tampa, Florida, for ammonia nitrogenous fertilizer settled at $1.000 per metric ton, down 30% from $1.425 in May, according to Green Markets, a Bloomberg company.

However, despite this decline, ammonia prices are still 87% higher than a year ago, and supply chain issues continue to wreak havoc on global markets.

Demand destruction is part of the decline. In places like Southeast Asia, buyers are unwilling to pay record ammonia prices in April and May, Green Markets analyst Alexis Maxwell said.

In addition, it reflects the decline in the cost of ammonia production as natural gas prices in Europe fell in the second quarter, it said.

Wholesale prices for another type of nitrogenous fertilizer, urea, fell nearly 8% on Friday in New Orleans, US, to $585 a short ton. But retail prices are still nearly double, at $1.030 a short ton.

Source: Blueberries Consulting