Weekly Fertilizer Bulletin | Fertilizers Fall Amid Fresh Tariff Threat

Posted on 07/17/2018 11:47 AM

 

  • Fertilizer prices were lower across the board with urea leading declines.
  • Our Nutrient Composite Index softened 3.96 points to 559.17. This compares to our 5-year average of 675.17.

Nitrogennitrogen indices chart

  • Urea was our downside leader in the nitrogen segment this week although all four of the N products we survey posted declines.
  • UAN solutions fell modestly on the week. On an indexed basis, urea, UAN28% and UAN32% are very closely aligned and for the first time since August 2017, urea has dropped to a price point below that of indexed UAN28%.
  • Since anhydrous ammonia holds a decent discount to the rest of the nitrogen segment, there is risk NH3 will firm to correct the disparity.
  • The near-term forecast has become very uncertain in light of the latest round of proposed tariffs against Chinese-produced goods which includes all forms of finished fertilizers and farm fuels. Click here to view the list and read our initial thoughts on the matter.

Phosphate

  • Phosphates were lower on the week with MAP falling roughly twice as much as DAP.p and k indices chart
  • This week's price action narrows the DAP/MAP spread and, perhaps more significantly, presses the midpoint between DAP and MAP down to $500.16.
  • Wholesale DAP and MAP prices were sideways to firmer on the week according to MosaicCo.
  • Wholesale sulphur values firmed slightly on the week after a long stretch unchanged. We continue to wait for sulphur prices to fall, indicating lower production costs. We expect downside potential to be limited until that time.

Potash

  • Potash prices were lower on the week with Minnesota leading declines.
  • Wholesale potash values ran sideways on the week according to MosaicCo.
  • On an indexed basis, potash currently holds a slight discount to NH3.

Corn Futures

  • December 2019 corn futures closed Friday July 13 at $3.87 putting expected new-crop revenue (eNCR) at $626.26 per acre -- off $20.76 per acre on the week.
  • With our Nutrient Composite Index (NCI) at 559.17 this week, the eNCR/NCI spread narrowed 16.80 points and now stands at -67.09.
Fertilizer
7/2/18
7/9/18
Change
Current Week
Fertilizer
Anhydrous
$523.98
$522.68
-$1.99
$520.70
Anhydrous
DAP
$488.01
$491.43
-$2.02
$489.41
DAP
MAP
$517.04
$517.03
-$5.22
$511.81
MAP
Potash
$349.74
$350.01
-$2.00
$348.01
Potash
UAN28
$255.21
$257.42
-71 cents
$256.72
UAN28
UAN32
$273.97
$279.58
-$1.17
$278.41
UAN32
Urea
$369.53
$369.48
-$6.67
$362.81
Urea
Composite
560.43
563.13
-3.96
559.17
Composite

nutrient composite index and expected new-crop corn revenue chart

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