Cheap fertiliser prices have added fuel to the 2020-21 winter crop recovery, supporting grower profit margins.
Nationally, urea sales were 26 per cent higher year-on-year during the first half of 2020.
Global fertiliser benchmarks bottomed-out at, or near, 10-year lows.
But the market has taken a new turn during the second half of this year, with prices across the global fertiliser complex moving back towards the 10-year average.
What does this mean for Australian growers in 2021?
According to Fertiliser Australia, on average in the past five years, 66 per cent of all fertiliser sold in Australia has been imported. This is up from an average of 50 per cent from 2002 to 2006.
For the three main products sold here, the figures are even higher.
In 2019, 86 per cent of urea sold was imported, along with 79 per cent of mono-ammonium phosphate (MAP) and 100 per cent of Muriate of Potash (MOP).
And, of the domestically-produced fertiliser products, some rely on imported raw materials.
As such, local farm-gate fertiliser prices are predominantly driven by global prices, the Australian Dollar and - to a lesser extent - ocean freight rates.
For growers, the good news is that we expect heavy supplies and growing production capacity will continue to weigh on prices across the global nutrient complex.
In the immediate term, we see prices of phosphates and urea continuing to be supported by Northern Hemisphere demand - until the start and end of quarter one in 2021, respectively.
But when seasonal demand from the Northern Hemisphere subsides, markets will again be exposed to heavy supplies.
In 2021, this is expected to be particularly the case for urea.
The International Fertilizer Association expects another nine million tonnes of urea production capacity, which is a 4.5 per cent rise and well above its forecast demand growth of 1 per cent.
Almost half of that new capacity is likely to appear in India, reducing that country's activity in global markets.
The one exception is potash, where the market is more supportive of prices.
We expect importers in China and India will continue to cover inventories, and demand in the US and Brazil will be sustained.
On the supply side, current low prices may limit production from high-cost plants and new projects coming online.
As a result, we are forecasting global potash prices to increase at a constant rate during the first half of 2021.
While we expect global fertiliser prices to remain favourable for Australian producers, one factor chewing into importers' purchasing power will be a relatively weak Australian Dollar.
At current urea prices, a one cent drop in the Dollar represents about a $5-6 per tonne increase in local prices.
The ongoing impacts of COVID-19 also need to be considered in the year ahead.
The resilience of local and global fertiliser supply chains to the impacts of the global pandemic this year have been something to celebrate.
To the end of August, year-to-date urea imports reached 2.1 million tonnes - about 300,000 tonnes more than 2019 - and 665,000 tonnes more than 2018.
But with case numbers still very high in many parts of the world, the potential for a COVID-19-related interruption to either supply or production remains.