Research

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Leigh Creek Energy Limited (ASX:LCK)

 

·          The A$ has weakened by 28% from US$0.81 at the beginning of 2018 to current levels of US$0.58. While global US$ fertiliser (urea (N), phosphate (P), potash (K)) prices have trended sideways to down in recent years, a softer domestic currency will undoubtedly start impacting on the fertiliser cost per acre for Australian farmers. Fertilisers account for 25-30% of a farmer’s direct input costs; significant hikes in fertiliser costs could flow through into higher crop and meat/milk prices. We suggest that on the back of the global chaos caused by the COVID-19 pandemic, many governments will be carefully reassessing their countries’ food security. Increasing Australia’s self-reliance on fertilisers / reducing Australia’s dependence on imported fertilisers, may well become an important government objective in the next few years.

 
23/03/2020 10:00:00 AM

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