Controlled Release Fertilizers Market

The global controlled release fertilizers market achieved a valuation of $2.4 billion in 2023 and is anticipated to reach $3.3 billion by 2030, with a compound annual growth rate (CAGR) of 6.4% during the forecast period from 2023 to 2030.

This signifies a steady growth rate, reflecting the rising demand and adoption of these advanced fertilizers. Factors such as the increasing global population, higher application rates in developing nations, and a surge in the demand for high-value crops are expected to drive the controlled release fertilizer market's expansion in the forecast period.

The market for controlled release fertilizers (CRFs) is poised for significant growth in the coming years. CRFs are specialized fertilizers that gradually release nutrients over an extended period, ensuring a consistent supply to plants while minimizing wastage. This type of fertilizer reduces the risk of over-fertilization and mitigates nutrient leaching into groundwater, providing a more sustainable and eco-friendly solution for crop production.

The growth of the controlled release fertilizer market is propelled by the increasing demand for food to sustain the expanding global population and the growing concern for environmental preservation. Additionally, the adoption of modern farming techniques and the need for efficient nutrient management practices have contributed to the market's development.

Controlled Release Fertilizers Market Dynamics

Driver: Necessity for highly efficient fertilizers

Farmers worldwide face a significant challenge of nutrient loss to the environment. This issue is particularly pronounced in heavily fertilized crops like corn, which tend to experience substantial nutrient losses compared to less intensive uses like pasture. Poor land management practices associated with agricultural activities can also contribute to nutrient losses through erosion. The various pathways through which nutrient losses occur can have far-reaching environmental impacts.

Atmospheric losses: Nutrients can be lost to the atmosphere through chemical and biological processes. Volatile nutrients are particularly prone to being lost as gases when exposed to the atmosphere.

Direct loss: Direct or incidental loss refers to the loss of fertilizer or manure to water before having a significant interaction with the soil. Over-application, heavy rainfall immediately after application, or application directly into waterways (including ditches) can contribute to direct losses.

Runoff: Runoff happens when rainfall or snowmelt exceeds the soil's ability to absorb it. As a result, dissolved nutrients are carried away by the runoff into nearby water bodies.

Leaching: Leaching occurs when water and soluble substances move downward through the soil beyond the root zone. It is a concern from an environmental standpoint as it contributes to contamination of groundwater.

The concern of nutrient losses leading to water pollution and eutrophication has gained attention in recent years. To address this concern, the fertilizer industry and associations promote Fertilizer Best Management Practices that advocate the use of enhanced efficiency fertilizers (EEF) and encourage farmers to adopt these fertilizers. These practices emphasize the proper application of fertilizers in terms of quantity, timing, and placement, driving the adoption of controlled release fertilizers in the market.

Challenge: Cost inefficiency

The production cost of controlled-release fertilizers is significantly higher compared to conventional soil-applied fertilizers due to the complex manufacturing processes involved. According to the International Fertilizer Association (IFA), the prices of controlled-release fertilizers have remained four to six times higher than conventional NPK (nitrogen, phosphorus, and potassium) fertilizers. This cost difference poses a major restraint for the controlled release fertilizers market. While conventional fertilizers require repeated applications, controlled-release fertilizers offer programmed and predefined nutrient release patterns, resulting in a higher initial investment cost for farmers. As a result, the use of controlled-release fertilizers is limited to high-value cash crops, hindering market growth in broad-acre crops such as rice and wheat, especially in developing countries where return on investment for these crops has been relatively low for farmers.

Opportunity: Strong growth in emerging economies

The Asia Pacific region, being the largest consumer of fertilizers, is experiencing a rise in population and increased demand for food products, driving fertilizer consumption. However, the region faces concerns regarding soil pollution, environmental harm, and human health risks. To address these concerns, governments in the region are focusing on the use of fertilizers that are less detrimental to the soil. As the Asia Pacific region comprises developing countries with small average landholdings for farmers, the need to maximize productivity in limited land areas is paramount. This is projected to drive the demand for specialty fertilizers as farmers strive to increase yields despite challenges such as population growth, shrinking agricultural land, environmental degradation, and inadequate infrastructure.

Challenge: Lack of awareness among farmers

Farmers in developing countries have limited awareness about specialty fertilizers, including their proper usage and cost-effective benefits. They often lack knowledge about the basic nutrient requirements of the soil. Their familiarity is mostly limited to primary nutrients, and the nutrient response ratio is not satisfactory due to imbalanced fertilization and the neglect of secondary macronutrients.

Additionally, there is a lack of awareness about specific brands as the market is highly fragmented at the regional level. Despite efforts by agronomists worldwide, farmers have limited knowledge or awareness about the benefits of secondary macronutrients and their potential to increase crop yields. In countries like India and China, where agriculture plays a significant role in the livelihoods of a large portion of the population, farmers tend to be risk-averse when it comes to production capacity. Moreover, the high costs associated with specialty fertilizers act as a deterrent. Changing farmers' perspectives and helping them understand the usage and benefits of specialty fertilizers present a challenge for the growth of the specialty fertilizers market.

Within the controlled release fertilizer market, the coated and encapsulated subsegment is projected to hold the largest market share. The adoption of coated fertilizers and encapsulated fertilizers has been steadily increasing globally, driven by the growing awareness of their benefits and the support provided by governments in the form of subsidies and policy amendments. Such government policies and well-defined regulations serve as catalysts for the market's growth on a global scale.

The fastest growth in the controlled release fertilizer market is expected to be seen in the fertigation subsegment within the application segment. This growth is primarily driven by factors such as improved productivity and higher yields. Fertigation, which involves the application of fertilizers through irrigation water systems, is gaining significance due to its reliability and effectiveness. Additionally, it offers cost savings of 29% to 78% compared to other application methods, thanks to its enhanced efficiency. Fertigation has been widely adopted by major countries and is considered superior to broadcasting and subsurface placement methods.

During the forecast period, the non-agriculture segment is projected to hold the largest market share in the controlled release fertilizer market. This can be attributed to increased purchasing power and growing environmental concerns, which have led to a rise in demand for controlled release fertilizers in non-agricultural applications. Moreover, due to government regulations governing controlled-release fertilizers, their usage in agricultural crops has also expanded significantly in developing countries. The market is further driven by the growing adoption of controlled release fertilizers for turf and ornamental grass. While controlled-release fertilizers have been used for turf and ornamental grass in the United States for over a decade, their demand has recently been increasing in developing countries. The ease of application on ornamental crops is a significant factor driving the market growth in this segment.

During the forecast period, the Asia Pacific region is expected to hold the largest share in the controlled release fertilizer market. In terms of both volume and value, Asia Pacific has already accounted for the largest share. The region's growth is driven by factors such as the increasing cultivation of high-value crops and growing awareness among farmers regarding the environmental benefits of using controlled-release fertilizers. Government policies implemented in Asia Pacific countries, along with substantial subsidies provided for fertilizers, often up to 100% for marginal farmers, are major catalysts for market growth in the region.

The key players in the controlled release fertilizer market include Yara International ASA (Norway), Nutrien Ltd. (Canada), The Mosaic Company (US), ICL Group (Israel), Nufarm Ltd. (Australia), Kingenta (China), ScottsMiracle-Gro (US), Koch Industries (US), Helena Chemical (US), and SQM (Chile). These companies are focused on expanding their presence through agreements and collaborations. They have established strong footholds in North America, Asia Pacific, and Europe, with manufacturing facilities and robust distribution networks across these regions.

This research report classifies the controlled release fertilizers market based on type, application, form, source, and region.

Based on type, the market has been segmented as follows:

• Slow release
  • Urea formaldehyde
  • Urea isobutyraldehyde
  • Urea acetaldehyde
  • Other slow release fertilizer
• Nitrogen stabilizers (N-Stabilizers)
  • Nitrification inhibitors
  • Urease inhibitors

• Coated and encapsulated

• Sulfar coated
• Polymer coated
• Sulfar polymer coated
• Other coated and encapsulated fertilizers

Based on End Use, the market has been segmented as follows:

• Agricultural
  • Cereals and grains
  • Oilseed and pulses
  • Vegetables
  • Fruits
  • Plantation crops
• Non agricultural
  • Turfs and ornamentals
  • Nurseries and greenhouses
  • Other non agricultural end uses

Based on the mode of application, the market has been segmented as follows:

• Foliar
• Fertigation
• Soil
• Other modes of application

Based on the region, the market has been segmented as follows:

• North America
• Europe
• Asia Pacific
• South America
• RoW (the Middle East & Africa)

Recent Developments

• In December 2023, Yara International ASA formed a collaboration with Sumitomo Chemical Co. Ltd. This partnership aimed to accelerate Japan's transition towards green energy and capitalize on the increasing interest in clean ammonia.
• In April 2023, Nufarm Ltd collaborated with Crop Zone to introduce alternative weed control solutions to major European markets. By combining chemical and physical processes, Nufarm and Crop Zone developed a sustainable method of weed control. The approach involved treating plants with a regulated organic liquid that is conductive and applying electrical charge, resulting in highly efficient weed control with lower energy consumption compared to conventional weeding technologies.
• In March 2023, The Mosaic Company partnered with Sound Agriculture to develop and distribute a nutrient efficiency product. This collaboration focused on activating the soil microbiome to enhance plant access to essential nutrients, enabling growers to optimize their fertilizer inputs.