The NFiles: Nitrogen Pointed Higher

Posted on 03/09/2017 10:12 AM

 

  • Anhydrous is $55.23 below year-ago pricing -- higher $5.59/st this week at $507.30.
  • Urea is 21 cents below the same time last year -- higher $2.47/st this week to $360.89.
  • UAN28% is $26.47 below year-ago -- higher $2.66/st this week to $244.45.
  • UAN32% is priced $24.93 below last year -- higher $3.55/st this week at $278.33.

inputsmonitor.com"Anhydrous ammonia was once again our upside leader in the nitrogen segment. No state posted a lower price this week as South Dakota firmed $16.67 to lead gains followed by Nebraska, up $16.35 and Indiana firming $13.02. Four states were unchanged, but the lack of softer prices anywhere in our 12-state survey indicates upside momentum is strong.

UAN32% looks equally bullish with no state posting a lower 32% price this week. Price strength was led by Wisconsin which added $14.88. Michigan climbed $13.02 and Nebraska firmed $7.52.

UAN28% was led higher by Wisconsin which added $19.48 per short ton as Indiana firmed $3.30 and North Dakota gained $2.98. Five inputsmonitor.comstates were unchanged as Nebraska posted our only declines in 28% falling a paltry 13 cents per short ton.

Urea was higher this week as well led by gains in Wisconsin to the tune of $24.00 per short ton as Illinois added $1.80 and Nebraska firmed $1.60.

Little change to our near-term outlook which calls for higher nitrogen prices between now and spring. The margins between our nitrogen products continue to point to higher prices with urea at a sharp premium to anhydrous ammonia and to UAN. In fact, with anhydrous currently our lowest form of nitrogen, we expect NH3 to inputsmonitor.comcontinue to add to the last two weeks of aggressive price increases.

Get current to 100% filled on spring/summer nitrogen while nitrogen remains at a discount to expected new-crop corn revenue.

December 2017 corn closed at $3.91 on Friday, February 24. That places expected new-crop revenue (eNCR) per acre based on Dec '17 futures at $625.86 with the eNCR17/NH3 spread at -118.56 with anhydrous ammonia priced at a discount to expected new-crop revenue. The spread narrowed 10.72 points on the week.

Nitrogen pricing by pound of N 2/28/17

Anhydrous $N/lb

Urea $N/lb
UAN28 $N/lb
UAN32 $N/lb
Midwest Average
$0.30 3/4
$0.40
$0.44
$0.43 3/4
Year-ago
$0.34 1/4
$0.40
$0.47 1/2
$0.47 3/4

 

The Margins -- UAN32% is at a 3 cent premium to NH3. Urea is 4 1/4 cents above anhydrous ammonia; UAN28% solution is priced 1 1/4 cent above NH3.

Nitrogen
Expected Margin
Current Price by the Pound of N
Actual Margin This Week
Outstanding Spread
Anhydrous Ammonia (NH3)
0
30 3/4 cents
0
0
Urea
NH3 5 cents
40 cents
9 1/4 cents
4 1/4 cents
UAN28%
NH3 12 cents
44 cents
13 1/4 cents
1 1/4 cent
UAN32%
NH3 10 cents
43 3/4 cents
13 cents
3 cents

 

inputsmonitor.com

 

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