The NFiles | Nitrogen Nets Declines

Posted on 01/18/2018 4:19 PM

anhydrous

  • Anhydrous is $27.03 below year-ago pricing -- higher $1.76/st this week at $448.31.
  • Urea is $5.78 above the same time last year -- higher $1.03/st this week at $351.02.
  • UAN28% is $11.25 below year-ago -- lower $4.31/st this week to $218.05.
  • UAN32% is priced $9.06 below last year -- unchanged this week at $244.74.

Anhydrous ammonia was our upside leader in the nitrogen segment with Missouri leading to the upside, firming $13.43 as Iowa added $5.23 and Illinois firmed 72 cents. Nine sates were unchanged and no state posted a lower NH3 price on the week.

Urea was right behind anhydrous led by strength in Iowa to the tune of $13.10 and Illinois gained 66 cents. Nine states were unchanged as North Dakota fell $1.38.urea

UAN32% was unchanged with no state posting a price change this week.

UAN28% was our sole decliner in the nitrogen segment with Illinois off $33.27 and Indiana down $14.10 as all other states were unchanged.

Nitrogen prices are mixed this week with a decline in UAN28% offsetting gains in urea and anhydrous ammonia. According to recent surveys and word on the "street," fall applications were sizable enough that spring supplies should be solid. Those farmers that have not yet locked in their spring/summer fertilizer needs will likely pay higher prices than those who bought before nitrogen's post-harvest uptrend, but we expect fertilizer prices to sink to some degree between now and spring.UAN

For now, we advise farmers who have nitrogen needs unfilled for spring/summer to keep a close eye on local and regional trends. We expect opportunities between now and spring, but we may find ourselves waiting until late in the spring, buying hand to mouth. Stay tuned.

December 2018 corn closed at $3.80 on Friday, January 12. That places expected new-crop revenue (eNCR) per acre based on Dec '18 futures at $601.37 with the eNCR17/NH3 spread at -153.06 with anhydrous ammonia priced at a discount to expected new-crop revenue. The spread narrowed 9.61 points on the week.


Nitrogen pricing by pound of N 1/16/18

Anhydrous $N/lb

Urea $N/lb
UAN28 $N/lb
UAN32 $N/lb
Midwest Average
$0.27 1/2
$0.39
$0.38 3/4
$0.38 1/2
Year-ago
$0.29 1/4
$0.38 1/2
$0.41
$0.39 1/4

The Margins by lb/N -- UAN32% is at a 1 cent premium to NH3. Urea is 6 1/2 cents above anhydrous ammonia; UAN28% solution is priced a penny below NH3.


Nitrogen
Expected Margin
Current Price by the Pound of N
Actual Margin This Week
Outstanding Spread
Anhydrous Ammonia (NH3)
0
27 1/2 cents
0
0
Urea
NH3 +5 cents
39 cents
+11 1/2 cents
+6 1/2 cents
UAN28%
NH3 +12 cents
38 1/2 cents
+11 cents
-1 cent
UAN32%
NH3 +10 cents
38 1/2 cents
+11 cents
+1 cent

nitrogen indices chart

 

 

 

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