I should have said 40% of the feedstock for exported fertilizer. I also should have explicitly noted that because a lot of wheat is still produced locally to where it’s consumed, the famine risk is limited to places that are dependent on wheat imports.
Unfortunately there are plenty of those. And they are generally places that are poor by other measures as well, making coping with economic shocks more fraught.
Your argument that 3X current phosphate prices is tolerable seems sound. On the other hand, anything that has to be mined has inelastic supply because the cost of the capital equipment—and in many countries the cost of the regulatory approvals—is so high.
I should have said 40% of the feedstock for exported fertilizer. I also should have explicitly noted that because a lot of wheat is still produced locally to where it’s consumed, the famine risk is limited to places that are dependent on wheat imports.
Unfortunately there are plenty of those. And they are generally places that are poor by other measures as well, making coping with economic shocks more fraught.
Your argument that 3X current phosphate prices is tolerable seems sound. On the other hand, anything that has to be mined has inelastic supply because the cost of the capital equipment—and in many countries the cost of the regulatory approvals—is so high.