Water Soluble Fertilizer Market

The global water-soluble fertilizers market is expected to register a significant growth during the review period. Several factors are driving the growth of the market. The high demand for high-value crops and organic agriculture contribute significantly to the global water-soluble fertilizers market growth. The numerous benefits provided by water soluble fertilizers further boosts the growth of the market. However, increasing prices of fertilizers and export restrictions on fertilizers are expected to restrain the market growth. Nevertheless, increasing need for agricultural productivity create an opportunistic market for the players in the water-soluble fertilizers detergent industry.

There is a rising demand for high-value crops and organic agriculture as consumers become more aware of the health and environmental benefits of these products. The consumers rising awareness regarding organic farming has created lucrative growth for organic fertilizers. Key manufacturers in the market have started manufacturing environment-friendly fertilizers products by using natural and non-harmful materials. High-value crops are crops that are typically sold at a higher price due to their unique characteristics or attributes, such as flavor, quality, or nutritional content. These crops can include specialty fruits and vegetables, herbs, and spices, as well as niche crops such as quinoa and kale. Organic agriculture refers to a production system that emphasizes the use of natural fertilizers and processes, rather than synthetic chemicals, to grow crops and raise livestock. Organic agriculture aims to promote soil health and biodiversity, reduce pollution, and minimize the negative impacts of farming on the environment. Demand for high-value crops and organic agriculture has increased in recent years as consumers become more interested in the health and environmental impacts of their food choices. In addition, the trend toward plant-based and sustainable diets has also contributed to the demand for these products. For Instance, According to FiBL, Europe's total farmland's organic area share grew from 3.1% in 2018 to 3.4% in 2020. Similarly, in Latin America, the percentage of organic farming rose from 1.1% in 2018 to 1.4% in 2020. The need for fertilizers is growing with an increasing demand for organic food items.

The water-soluble fertilizers demand is projected to witness continuous growth during the forthcoming years due to the rising requirement of specialty fertilizers to enhance the production of high-quality crops. The growing world population in several developing and under-developed countries has raised concerns over food security and existing food production solutions. Growing initiatives by the government to promote specialty fertilizers and the launch of programs to educate farmers about the novel fertilizer type and its benefits will aid the market growth.

The demand for food is expected to grow substantially during the forecast period. The exponential increase in the world's population leads to an increased demand for food. According to the United Nations Food and Agriculture Organization, agricultural output per person has increased by 50% since 1960. Several government bodies across the globe are taking numerous steps to make targeted increases in productivity within specified periods. It is estimated that the output per unit of total resources used in production will be doubled by 2050 to meet the growing demand, while resources such as land and labor are limited. Resources such as water are limited, and it is of extreme importance that water resources be handled with high efficiency to improve water management. As per data from the UN, approximately 70% of the freshwater withdrawn every year is used in agriculture. Furthermore, around two-thirds of the global population live in water-scarce areas, necessitating efficient water management systems. The global agricultural industry is facing challenges of feeding a rising population with limited arable lands. This means that growers across the spectrum are aggressively seeking to boost the capacity for producing healthy crops with higher yields. For handling this situation one of the most crucial tools in the modern farmer’s tool kit is proved to be water soluble fertilizers (WSFs). Water soluble fertilizers can be dissolved in water and are applied directly to the plant through drip irrigation and foliar application for increasing nutrient use efficiency. Using drip irrigation substantially decreases nitrous oxide (N2O) emissions, compared to other irrigation systems, such as furrow or sprinklers. Water soluble fertilizer are directly applied to the leaves instead of the soil. Owing to this target-oriented approach, nutrients are delivered directly to plant tissues during critical growth stages thereby boosting productivity. Thus, the increasing need for agricultural productivity is expected to drive the growth of the global water-soluble fertilizers market during the forecast period.

According to an article published by World Trade Organization, fertilizer prices are increasing tremendously. The rising prices of fertilizers tends to be faster than the increasing prices received by farmers, this is squeezing producer margins. This could indicate, in turn, a drop in affordability and input use by farmers. This leads to additional issues of food availability and compounding the food access problem. Higher prices and overall lower affordability of fertilizer in 2021/22 indicates lower global fertilizer applications in 2022/23. The International Fertilizer Industry Association (IFA) expects reductions in the use of all three main nutrients in 2022/23. According to the data published by IFA, the application of N-fertilizer (nitrogen fertilizer) is projected to drop by 1.8% and could even degrade to 4.8% in the pessimistic scenario. The usage of P-fertilizer (phosphorus fertilizer) is estimated to fall by 3.5% and could fall by around 6.5% in the pessimistic scenario. Also, the use of K-fertilizer (potassium fertilizer) is estimated to decrease by approximately 10%, and by as much as 13.0% in the pessimistic scenario. Hence, the increasing prices of water-soluble fertilizers is expected to be restraining the market growth for the forecast period.

The increasing global demand for fertilizers and rising domestic prices has made several key suppliers introduce export restrictions on the fertilizers. This is placing further upward pressure on international fertilizer prices, particularly since late 2021.According to a data published by World Trade Organization (WTO), export restriction was the largest category of fertilizer related measures introduced between 1 January 2021 to 15 October 2022, around 41%. Most export restriction measures applied during the reference period took the form of duties, bans, taxes and quotas. Thus, the increasing export restrictions on the water-soluble fertilizers is expected to be a challenging factor for the market growth during the forecast period.