The hidden cost of phosphate fertilizers: mapping multi-stakeholder supply chain risks and impacts from mine to fork

Abstract

Without phosphorus, we could not produce food. Farmers need access to phosphate fertilizers to achieve the high crop yields needed to feed the world. Yet growing global demand for phosphorus could surpass supply in the coming decades, and the world currently largely relies on non-renewable phosphate rock that is mined in only a few countries. Morocco alone controls 75% of the remaining reserves, including those in the conflict territory of Western Sahara. While some argue that the market will take care of any scarcity, the market price of phosphate fertilizers fails to account for far-ranging negative impacts. Drawing on multi-stakeholder supply chain risk frameworks, the article identifies a range of negative impacts, including the exploitation and displacement of the Saharawi people, the destruction of aquatic ecosystems by nutrient pollution, and jeopardizing future generations' ability to produce food. This paper fills a crucial gap in understanding phosphorus impacts by mapping and discussing the nature of phosphorus supply chain risks, and the transmission of such risks to different stakeholder groups. It also identifies a range of potential interventions to mitigate and manage those risks. In addition, the paper highlights that while risks are diverse, from geopolitical to ecological, those groups adversely affected are also diverse – including the Saharawi people, farmers, businesses, food consumers and the environment. Potential risk mitigation strategies range from resource sparing (using phosphorus more sparingly to extend the life of high quality rock for ourselves and future generations), to resource diversification (sourcing phosphorus from a range of ethical sources to reduce dependence on imported phosphate, as a buffer against supply disruptions, and preferencing those sources with lower societal costs), and sharing the responsibility for these costs and consequences.

Keywords:

• phosphorus scarcity
• food security
• supply chain risks
• geopolitics
• stakeholder impacts
• social responsibility

Acknowledgments

The authors would like to thank the two blind peer reviewers for their insightful, thoughtful and constructive comments and suggestions in relation to supply chain risks and ethics that have improved this paper.

Disclosure statement

No potential conflict of interest was reported by the authors.

Notes on contributors

Dr Dana Cordell is a Research Principal at the Institute for Sustainable Futures, University of Technology Sydney. Dr Cordell leads and undertakes transdisciplinary research projects on sustainable food and resource futures at the Institute for Sustainable Futures. Many projects involve high-level stakeholder engagement to improve the research relevance, impact and foster mutual learning. In 2008 Dr Cordell co-founded the Global Phosphorus Research Initiative – the first global platform to undertake research, facilitate networking and debate among policy-makers, industry, scientists and the public to ensure food systems are resilient to the emerging global challenge of phosphorus scarcity. As a food security expert, Dr Cordell also provides expert advice and commentary to UNEP, the UK Parliament and Australia's Chief Scientist.

Joanne Chong is a Research Director at the Institute for Sustainable Futures, University of Technology Sydney. Joanne leads cross-sectoral, multi-disciplinary applied research working in collaboration with governments, civil society, donors industry, enterprise and community stakeholders to build and enhance policy, governance and practices for sustainable resource outcomes. Joanne is a water resource sector specialist and has undertaken risk, vulnerability and capacity assessment, scenario analysis, strategic planning and monitoring and evaluation in urban and rural contexts in Australia and in Asia Pacific countries.

Andrea Turner is a Research Director at the Institute for Sustainable Futures, University of Technology Sydney. She is a charted civil engineer with a postgraduate degree in environmental engineer and over 20 years experience in the water industry. She has led numerous water efficiency, drought and resource planning research projects from city to regional scale for utilities and government agencies in Australia and internationally. She has worked extensively with organisations such the International Water Association, EU Switch, US based Alliance for Water Efficiency and Australian based National Water Commission and Water Services Association of Australia to develop resources, guides, training and tools to aid best practice water management and planning.

Notes

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5 Cordell & White. Life's Bottleneck.

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8 See section 2.

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11 TEEB, ‘The Economics of Ecosystems and Biodiversity: Mainstreaming the Economics of Nature: A Synthesis of the Approach, Conclusions and Recommendations of TEEB' (2010).

12 Ibid.

13 Millennium Ecosystem Assessment, ‘Ecosystems and Human Well-being: Wetlands and Water Synthesis’ (Washington D.C: World Resources Institute, 2005). Available: http://www.millenniumassessment.org/documents/document.358.aspx.pdf

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22 S. Jaffee, P. Siegel, and C. Andrews, ‘Rapid Agricultural Supply Chain Risk Assessment, A Conceptual Framework', Agriculture and Rural Development Discussion Paper 47 (Washington D.C: The World Bank, 2010).

23 E.g. Cordell and White, ‘Life's Bottleneck'.

24 Cordell et al., ‘The Story of Phosphorus’.

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26 E.g. D. Cordell and S. White, ‘Sustainable Phosphorus Measures: Strategies and Technologies for Achieving Phosphorus Security', Agronomy 3, no. 1 (2013): 86–116; D. Cordell and S. White, ‘Phosphorus Security: Global Non-governance of a Critical Resource for Food Security’, in Edward Elgar Encyclopedia of Global Environmental Politics and Governance, ed. P. Pattberg and F. Fariborz Zelli (Cheltenham, UK & Northampton, MA, USA: Edward Elgar, 2015).

27 E.g. HCSS, Risks and Opportunities in the Global Phosphate Rock Market: Robust Strategies in Times of Uncertainty (The Hague: Hague Centre for Strategic Studies, 2012).

28 E.g. W. Dodds et al., ‘Eutrophication of U.S. Freshwaters: Analysis of Potential Economic Damages', Environmental Science & Technology. 43, no. 1 (2009): 12–19.

29 E.g. IFA, ‘Food Prices and Fertilizer Markets: Factors influencing variations in fertilizer market conditions' (Paris: International Fertilizer Industry Association, June 2011); IFDC, ‘Fertilizer Supply and Costs in Africa' (Chemonics International Inc. and the International Center for Soil Fertility and Agricultural Development, 2007).

30 S. Fane, A. Turner, and C. Mitchell, ‘The Secret Life of Water Systems: Least Cost Planning beyond Demand Management’, in 2nd IWA Leading-Edge on Sustainability in Water-Limited Environments, ed. M.B. Beck and A. Speers (London: IWA Publishing, 2006), 35–41.

31 Ibid.; A. Turner et al., ‘Guide to Demand Management and Integrated Resource Planning' (paper prepared for the National Water Commission and the Water Services Association of Australia, Inc., at Institute for Sustainable Futures, University of Technology Sydney, 2010).

32 Jaffee et al., ‘Rapid Agricultural Supply Chain Risk Assessment’.

33 S. White et al., ‘Putting the Economics in its Place: Decision-making in an Uncertain Environment’, in Deliberative Ecological Economics, ed. C. Zografos and R. Howarth (New Dehli: Oxford University Press, 2008), 80–106.

34 Jaffee et al., ‘Rapid Agricultural Supply Chain Risk Assessment’.

35 IFA ‘Feeding the Earth: Fertilizers and Global Food Security' (Paris: International Fertilizer Industry Association, May 2008).

36 See section 5 and Figure 7.

37 ‘Free on Board’ at port of loading.

38 IFDC, ‘Fertilizer Supply and Costs in Africa'.

39 Ibid.; A. Runge-Metzger, ‘Closing the Cycle: Obstacles to Efficient P Management for Improved Global Food Security’, in Phosphorus in the Global Environment: Transfers, Cycles and Management, ed. H. Tiessen, SCOPE 54 (Chichester: Wiley, 1995), 27–42.

40 Cordell et al., ‘The Story of Phosphorus’.

41 M. Prud'homme, ‘World Phosphate Rock Flows, Losses and Uses' (paper presented at International Fertilizer Industry Association Phosphates International Conference, Brussels, March 22–24, 2010).

42 UNEP, ‘Environmental Aspects of Phosphate and Potash Mining’ (Paris: UN Environment Programme & International Fertilizer Industry Association, 2010).

43 Schroder et al., ‘Sustainable Use of Phosphorus'.

44 Ibid.

45 Ibid.

46 J. Rockström et al., ‘A Safe Operating Space for Humanity', Nature 461 (2009): 472–75.

47 E. Bennett, S. Carpenter, and N. Caraco, ‘Human Impact on Erodable Phosphorus and Eutrophication: A Global Perspective’, Bioscience 51 (2001): 227–34.

48 R. Diaz and R. Rosenberg, ‘Spreading Dead Zones and Consequences for Marine Ecosystems', Science 321, no. 5891 (2008): 926–9.

49 Dodds et al., ‘Eutrophication of U.S. Freshwaters’.

50 D. Mitchell, ‘Lake Erie's Green Sludge Highlights our Phosphorus Problem’, Fortune (August 2014). Available at: http://fortune.com/2014/08/06/peak-phosphorus-toledo-water/.

51 Bennett et al., ‘Human Impact on Erodable Phosphorus and Eutrophication'.

52 S. Van Kauwenbergh, ‘World Phosphate Rock Reserves and Resources' (Washington, DC: International Fertilizer Development Centre, IFDC, 2010).

53 These studies have used post-2010 phosphate reserve data from IFDC 2010 or USGS 2011–13 to calculate supply in different regions. S. Mohr and G. Evans, ‘Projections of Future Phosphorus Production', Philica.com (2013), http://www.philica.com/display_article.php?article_id=380; P. Walan, ‘Modeling of Peak Phosphorus: A Study of Bottlenecks and Implications' (Master's diss., Uppsala University, Sweden, 2013); Cordell and White, ‘Life's Bottleneck'.

54 Van Kauwenbergh, ‘World Phosphate Rock Reserves and Resources'; D.P.P. Van Vuuren, A.F. Bouwman, and A.H.W. Beusen, ‘Phosphorus Demand for the 1970–2100 Period: A Scenario Analysis of Resource Depletion', Global Environmental Change 20, no. 3 (2010): 428–39, http://linkinghub.elsevier.com/retrieve/pii/S0959378010000312 (accessed March 18, 2013); D. Vaccari and N. Strigul, ‘Extrapolating Phosphorus Production to Estimate Resource Reserves', Chemosphere 84, no. 6 (2011): 792–97, http://www.ncbi.nlm.nih.gov/pubmed/21440285 (accessed March 8, 2013).

55 G. Metson, E. Bennett, and J. Elser, ‘The Role of Diet in Phosphorus Demand', Environmental Research Letters 7, no. 4 (2012): 1–10, 044043.

56 USGS, ‘Phosphate Rock’, Mineral Commodity Summaries, ed. S.M. Jasinski (US Geological Survey, January 2014).

57 J. Cooper et al., ‘The Future Distribution and Production of Global Phosphate Rock Reserves', Resources Conservation and Recycling 57 (2011): 78–86; HCSS, ‘Risks and Opportunities in the Global Phosphate Rock Market.

58 USGS, ‘Phosphate rock'.

59 Ibid.

60 HCSS, ‘Risks and Opportunities in the Global Phosphate Rock Market.

61 Ibid.

62 WSRW, ‘Morocco's Exports of Phosphates from Occupied Western Sahara, 2012 & 2013' (Melbourne: Western Sahara Resource Watch, 2014).

63 Ibid.

64 J. Smith, ‘The Taking of the Sahara: The Role of Natural Resources in the Continuing Occupation of Western Sahara, Journal of Global Change, Peace & Security (2015).

65 Ibid.

66 Cordell and White, ‘Phosphorus Security.

67 Ibid.

68 For a fuller description of phosphorus global non-governance and associated vulnerabilities, see ibid. and Cordell and Neset, ‘Phosphorus Vulnerability’.

69 E.g. Cordell and White, ‘Life's Bottleneck; Cordell and Neset, ‘Phosphorus Vulnerability’.

70 IFDC, ‘Fertilizer Supply and Costs in Africa'.

71 Cordell, ‘The Story of Phosphorus.

72 IFA, ‘Feeding the Earth; Cordell, ‘The Story of Phosphorus.

73 IFA, ‘Feeding the Earth.

74 Cordell and White, ‘Life's Bottleneck’.

75 Commonwealth of Australia, ‘Pricing and Supply Arrangements in the Australian and Global Fertiliser Market’, Final Report, Senate Select Committee on Agricultural and Related Industries (Commonwealth of Australia, 2009).

76 Cordell and White, ‘Phosphorus Security'.

77 R. Nelson et al., ‘The Vulnerability of Australian Rural Communities to Climate Variability and Change: Part I – Conceptualising and Measuring Vulnerability', Environmental Science Policy 13 (2010): 8–17.

78 Cordell and Neset identify 26 risk factors leading to phosphorus vulnerability in a national food system, including exposure, sensitivity and adaptive capacity factors. Cordell and Neset, ‘Phosphorus Vulnerability’.

79 D.G. Doody, P.J. Withers, and R.M. Dils, ‘Prioritizing Water Bodies to Balance Agricultural Production and Environmental Outcomes', Environmental Science and Technology 48, no. 14 (2014): 7697–9, http://www.ncbi.nlm.nih.gov/pubmed/24971468.

80 Jaffee et al., ‘Rapid Agricultural Supply Chain Risk Assessment’.

81 Matopoulos et al., ‘Resource-Efficient Supply Chains.

82 HCSS, ‘Risks and opportunities in the global phosphate rock market; ESPP, ‘Special Issue: European Sustainable Phosphorus Conference’, 111 (Brussels: European Sustainable Phosphorus Platform, March 2015), http://phosphorusplatform.eu/images/download/ScopeNewsletter_111_special_ESPC2.pdf.

83 WSRW, ‘Morocco's Exports of Phosphates from Occupied Western Sahara, 2012 & 2013'.

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87 Matopoulos et al., ‘Resource-Efficient Supply Chains.

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89 C. Sartorius, J. Von Horn, and F. Tettenborn, ,Phosphorus Recovery from Wastewater – State-of-the-art and Future Potential (paper presented at the International Conference on ‘Nutrient Recovery and Management 2011: Inside and Outside the Fence', Miami, FL, January 9–12, 2011).

90 N. Alexandratos and J. Bruinsma, ‘World Agriculture towards 2030/2050: The 2012 Revision’, ESAWork. paper no. 12-03, Agricultural Development Economics Division, Food and Agriculture Organization of the United Nations 2012, http://www.fao.org/3/a-ap106e.pdf

91 Metson et al., ‘The Role of Diet in Phosphorus Demand'; Cordell et al., ‘The Story of Phosphorus’.