US Sanctions Could Cause Chaos on LATAM Farms Run on Russian Fertilisers

• Latin American farmers are in for a rough ride if the U.S. slaps secondary sanctions on buyers of Russian exports, such as the fertilisers essential for cash crops from Mexican avocados to Brazilian soybeans and corn.
• Potential U.S. sanctions would pose a big problem for farmers in Mexico, which imported more than $580.0Mn of fertilisers last year from Russia, its largest supplier according to government data.
• Former director of international affairs for Mexico's agriculture ministry, Raul Urteaga, warned of a drop-off in the quality of fertilisers available if Russian imports disappear. He also noted that it could weaken avocado production and send prices higher for U.S. consumers. According to U.S. government data, the U.S. accounts for more than 80% of Mexico's total avocado exports, a market worth over $3.0Bn in 2024. "The price of avocados would increase if producers have to use other alternatives or find fertilisers that are imported from sources other than Russia," Urteaga said.
• NATO Secretary General Mark Rutte singled out Brazil among a handful of countries that could be hit "very hard" by sanctions for doing business with Russia as part of U.S. President Donald Trump's renewed push to end the war in Ukraine. For farm powerhouse Brazil, which covered about a third of its fertiliser demand with $3.7Bn of imports from Russia last year, there is virtually no alternative to fill the gap if those flows are halted, experts and industry players said.
• The World Bank has identified fertiliser costs as a driver of food inflation in Central America, contributing to a cost-of-living crisis that has stoked northward migration. Furthermore, fertiliser companies that have already severed ties with Russian suppliers, such as U.S.-based Mosaic, have expressed concerns that further trade disruptions with one of the world's top three fertiliser producers could exacerbate volatility. Consequently, the Presidents of Brazil and Mexico have indicated plans to boost domestic production and reduce reliance on foreign fertilisers.

(Source: Reuters)