Fertilizer Bulletin | Fertilizer Prices Flatten

Posted on 03/19/2019 3:58 PM

 

  • Fertilizer prices were mixed but slightly lower overall.
  • Our Nutrient Composite Index softened 0.04 points to 612.84.

Nitrogennitrogen indices

  • Nitrogen rices were mostly lower although anhydrous ammonia continued to climb in this week's survey.
  • Urea led declines, falling a little more than $4 per short ton regionwide.
  • UAN32% was about a buck and a half lower on the week with Wisconsin and Nebraska leading state by state declines.
  • UAN28% was only slightly lower with Indiana and Minnesota leading the downward push.
  • Anhydrous ammonia was higher on support from Ohio and Michigan which each firmed double-digits on the week.

With this week's price action we find UAN solutions priced well below anhydrous when considered on an indexed basis. Urea is now priced just slightly below anhydrous ammonia. This technical setup has historically pointed to price softness for the entire nitrogen complex, although it has been a rare occurrence, and I would not put too much stock in that technical setup. However, we have seen the rate of price gains in nitrogen products flatten significantly over the past few weeks, and this may be the first sign that nitrogen prices are working on a near-term top.

It also seems prudent to bring up spring nitrogen in the context of the massive, devastating floods underway in the Western Corn Belt. Rural roads -- not just the gravel roads -- are emerging from the flood waters impassible in many places. It will take a very long time to restore those byways, especially where bridges have been compromised. That will make it difficult for retailers to deliver fertilizers, seed and chemicals until the roads and bridges are repaired. Time will tell what that will mean for fertilizer prices out west. It could lead to an oversupply in the coming fall, but that would be the result of farmers being forced to pass on spring fertilizer, which would sadly mean either a decline in corn yields, or an increase in prevent plant acreage.

If your area is still underwater, your preferred retailer may be having a very difficult time this week, but it might be wise to begin thinking about contingency plans when it comes to applying spring nutrients. We have seen some growers opt for flown-on urea in times when soil conditions prohibit traffic between the rows. We may see a resurgence of that in the Western Belt, but that would assume seed deliveries will be made in a timely fashion, and fields dry out in time to get the crop in.p and k indices

It is, of course, far too early to make too many assumptions. But if you can squeeze in a conversation with your preferred retailer, you may find yourself ahead of the game once the weather straightens out, and road crews get the necessary repairs made.

Phosphate

  • Phosphate prices were mixed this week with MAP shooting $4.74 higher, led by sharp gains in Indiana and Ohio.
  • DAP fell $1.58 on the week with South Dakota leading the way downward.
  • According to MosaicCo., wholesale DAP and MAP prices firmed at NOLA with DAP also higher at Tampa and sideways in Central Florida during the week ended March 15.

Potash

  • Potash prices firmed regionally with Wisconsin and South Dakota leading the way higher.
  • When considered on an indexed basis, potash is currently priced well below anhydrous ammonia, but fundamentally, potash is not likely to firm far enough to couple with the anhydrous ammonia price per ton.
  • Wholesale potash prices were lower at NOLA and sideways in the Corn Belt during the report week.

Corn Futures

  • December 2019 corn futures closed Friday March 15 at $3.96 putting expected new-crop revenue (eNCR) at $641.83 per acre -- higher $13.84 per acre on the week.
  • With our Nutrient Composite Index (NCI) at 612.84 this week, the eNCR/NCI spread widened 13.88 points and now stands at -28.99.
Fertilizer
3/4/19
3/11/19
Change
Current Week
Fertilizer
Anhydrous
$606.61
$610.19
+$2.63
$612.82
Anhydrous
DAP
$515.59
$526.23
-$1.58
$524.64
DAP
MAP
$537.91
$538.32
+$4.74
$543.06
MAP
Potash
$384.64
$384.40
+$2.24
$386.64
Potash
UAN28
$282.26
$280.64
-58 cents
$280.06
UAN28
UAN32
$311.37
$312.09
-$1.48
$310.61
UAN32
Urea
$409.08
$408.80
-$4.08
$404.72
Urea
Composite
610.80
612.88
-0.04
612.84
Composite

Nutrient composite index

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