Brazil threatens to nationalize fertilizer mines

CUIABA, Brazil, May 20 (Reuters) - Brazil may nationalize privately held mineral deposits used to make fertilizer to bring down farm production costs, Agriculture Minister Reinhold Stephanes said.

The threat from Latin America's farming powerhouse, which is heavily dependent on fertilizer imports, is the latest in a regional trend to bring natural resources under greater state control as world oil and food prices push new highs.

Fertilizer prices have doubled over the past year.

"If it's necessary, yes, if it's necessary," the minister said on Monday night to the question of whether the state would repossess private concessions in the mining sector.

He was speaking at an event in Brazil's No. 1 soybean producing state of Mato Grosso.

Mato Grosso Governor Blairo Maggi, who has a controlling stake in the world's largest soybean producer, Amaggi, said the government was studying all the mineral deposits in Brazil that would provide phosphate and potassium for fertilizer.

The government would decide on whether to repossess mineral deposits and give them to state-run companies or others in the private sector to return fertilizer prices to levels four months ago, he said.

Brazil imports 80 percent of its potassium and 60 percent of its phosphorus. It is also a major importer of nitrogen. Prices for all of these have skyrocketed with increased world demand for agricultural crops.

Some fertilizers, such as nitrogen, are also made from petroleum products and have suffered price increases as world oil prices hit daily records.