“With prices at record levels, farmers decided to reduce applications to protect their margins,” Marina Cavalcante, an analyst at Bloomberg’s Green Markets said. Farmers are able to skip application of phosphate fertilizers without compromising yields since the soil can retain this nutrient for more than a year, she said.

Eoin Treacy's view

Nutrien reported disappointing earnings today amid “demand destruction”. That highlights some of the same issues that occurred with high fertilizer prices in 2007. Farmers rebelled and food insecurity killed off the market of biodiesel.

The share pulled back sharply today on this news and paused at the July low. At present the big question is about whether the strength in the grains and beans sector can be sustained.

The Invesco DB Agriculture Fund continues to pause in the region of the July lows too. If agriculture prices improve from here, it is reasonable to expect seed and fertilizer companies to also firm.