The Role of Nutrients in Sustainability

Nutrients play a unique role in replenishing our soils and sustaining the world's growing need for food,
fiber and fuel. Agrium is proud to be part of an industry that provides these life-sustaining resources and
maintains the quality of one of the world's most precious resources-our soil.

Replenishing our Soils

As crops grow, they remove nutrients from the soil. If these nutrients are not replaced, soil quality and
productivity decline. While this is a gradual process it is the reason many early civilizations failed. Their soil
simply could not support the food needs of their growing populations. With time, farmers in Egypt and China
found ways to sustain crop production by adding nutrients back to the soil through the addition of animal wastes.

The world found a way to economically provide the nitrogen needed to sustain our soils and growing population when Fritz Haber and Carl Bosch perfected a method in the early twentieth century for producing ammonia from hydrogen and air. This, in part, fueled the green revolution-helping farmers to increase production from 692 million tonnes of grain in 1950 to 1.9 billion tonnes of grain in 1992, on essentially the same land base.

However, soil degradation due to nutrient removal still occurs today. In impoverished and war-torn areas of the world, farmers are not able to replace nutrients removed by crops. This has led to desertification and the destruction of rainforests.

Even in developed countries, nutrient replacement has lagged removal in some areas. In fact, 56 percent of the agricultural land in North America was recently shown to have a net phosphate deficit-removal exceeded additions.

By working with growers, industry associations, government, and researchers, Agrium strives to ensure nutrients are applied in amounts that sustainably replenish soils.

Sustaining World Food and Energy Needs

As society strives to achieve energy security and reduce greenhouse gas emissions, governments are increasingly looking to agriculture to supply greater amounts of bio-fuel. In the past five years, United States corn use for ethanol has grown from 11 percent of the total production in 2002/03 to 23 percent in 2007/08. It is estimated that over 34 percent of the United States corn crop will be used to produce ethanol by 2012/13.

This is occurring at a time when world food grain stocks are at an all-time low and population growth is continuing to increase. As well, a growing global middle class is increasingly demanding more protein-rich foods, requiring grains to be fed to animals. An essential component in the production of this protein, is nitrogen.

Experts estimate that commercial fertilizer is responsible for the basic food needs of at least 40 percent of the world's population. While this is a tremendous achievement we know more must be done, as all too many people do not have enough food to live, let alone achieve a higher standard of living.

To meet increased demand for food, farmers are asked to increase production on their land while minimizing environmental impacts. Agrium is supporting this effort by working with researchers to grow more food through the use of best management practices embodied in the
4R Nutrient Management System (see illustration below) and new technologies like controlled-release fertilizers. Controlled-release products time the release of nutrients to match the needs of the plant. These products limit the number of required applications to the crop, saving energy, minimizing loss to the environment and increasing yields. Through the use of Agrium's ESN® (controlled-release urea), growers can increase corn yields by an average of five to ten percent. Although we are proud of this achievement, we are even more excited by what this technology can do in developing nations where growers do not have access to the equipment and knowledge needed to implement other best management practices. While there is much work to do, we are inspired to make our contribution to the United Nations' Millennium Development Goal of eradicating extreme hunger.

For the past 60 years, commercial fertilizers have been instrumental in ensuring a safe, nutritious, low-cost and abundant food supply. Their consistent quality, uniform size and predictable release of plant-available nutrients allow growers to manage nutrients more sustainably.

4R Nutrient Management System - right product, right rate, right time, right place

Food vs Fuel

During the past several years, North American growers have dedicated significantly more acres to growing corn for ethanol production. This shift creates considerable debate regarding food supply, costs, energy efficiencies and ethics. We believe that over the next few years a number of factors will combine to sort out the appropriate allocation of farm land and associated inputs for food, fuel and fiber. We expect market forces will play a big part. Ongoing energy research will lead to a better understanding of fuel alternatives. Governments, growers and industry will jointly and individually make decisions that take into account environmental, societal, and financial impacts in an integrated manner.

In the meantime, we will participate in research, education, and public discourse to ensure that government and grower decisions are based on sound analysis. And we will continue to do what we do best-provide growers with the right products and services to help them meet their objectives.

Minimizing Environmental Impacts

Nutrients are essential to life in proper quantities, but excess and unwise nutrient use can contribute to a variety of environmental issues, such as the over enrichment of water bodies (eutrophication), a lack of available oxygen in water bodies (hypoxia) and increased greenhouse gas emissions. Excess nutrients come from a wide range of sources including runoff from urban development, atmospheric deposition, sewage, industrial discharge and agriculture (soil erosion, manure and fertilizers).

Agrium and the fertilizer industry work with researchers to develop best management practices to reduce losses to the environment. To further support this effort, Agrium employs more than 475 Certified Crop Advisors who work with growers to ensure that practices are appropriate to each farm's soil, climatic and operational situation. This not only improves productivity and economic returns for the grower but minimizes environmental impacts.

Some people believe that fertilizers add harmful chemicals to our food. In reality, fertilizers come from nature and are chemically identical to the nutrients found naturally in decomposing soil organic matter, plants and animal wastes. Nitrogen in fertilizers is in the same form as that produced through biological fixation. Potassium and phosphorous in fertilizers are indistinguishable from those in organic sources and those produced through weathering of certain types of rock.

The nitrogen fertilizer manufacturing process captures atmospheric nitrogen and converts it into forms available to plants. Similarly, potash and phosphorous are mined from ancient seabeds, processed and converted to plant-available forms.

Providing products that optimize food, fuel and fiber production on existing farm land allows us to conserve greater space for wildlife habitat and recreation. It is estimated that without fertilizer, growers would have to bring into production 50 percent more land to produce the same amount of food.

The Bottom Line

Agrium is working to ensure that fertilizers contribute to:

• replenishing our soils;
• producing nutritious, safe and abundant food;
• minimizing the destruction of wildlife habitat; and
• creating a more sustainable world.

For an expanded discussion of the role of nutrients in sustainability and ESN, please see our website: www.agrium.com/products_services/

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