Fertilizers Freeze in Place | Also, Hello Kansas!

Posted on 07/23/2020 1:08 PM

 

Fertilizer prices were lower across the board this week.

Our Nutrient Composite Index (NCI) softened 1.89 points to 526.65.

Fertilizer prices have not moved much over the past two weeks. Last week there was so little price movement from state to state that we question the validity of our numbers. The Inputs Monitor tech squad dug deep into the numbers and even went so far as to reenter the week's data. As it turns out, there was nothing wrong with our system Fertilizer prices really did freeze in place.

With summer refill complete in most areas of the Midwest, price points were set early given the early start to the season in many areas. But the wholesale markets have been hard to figure since the end of spring applications. I believe instability and uncertainty in wholesale markets is keeping those retailers who have yet to resupply, or who may be looking at booking tonnage out for the 2021 spring season on the sidelines.

Phosphates are embroiled in a complicated export duty controversy involving phosphate exporting powerhouses in Morocco and Russia. A North American company has cried foul about sendout prices and an investigation has been opened. We will know the results of the ruling early next month, but the matter may not be settled until after the first of the year.

Urea production in China has been an interesting topic as well. With the major flooding going on there, some in key growing areas, domestic demand in China may fall off, forcing producers to offer their product on the export market after a few years of keeping it to themselves. There has also been the question of India's urea tender which usually sets the tone for price action on the export market. That has been slow to come and while a price does seem to have been negotiated, the scope of tonnage involved is still in question.

Here at home, potash, anhydrous ammonia and UAN solutions appear to be in good supply, and retail prices are reflecting that. The "flat spot" we have observed on the overall chart may indicate now is a good time to lock in some needs for fall anhydrous or even for some spring product. As always, we will wait for indications the market has bottomed before advising any action.

To get the straight scoop on the wholesale factors I mentions above, if you have not, click here to listen to my interview with Josh Linville from StoneX - formerly INTL FCStone. Linville is extremely knowledgeable and we were lucky to get his thoughts. Our chat runs about 17 minutes but it is worth it to listen through as Linville covered happenings in all the upstream fertilizer markets that impact our price survey. Give it a listen!

I would also add... HELLOOOO KANSAS! If you look at the breakout of this week's price changes below the following table, you may notice Kansas fertilizer prices led declines in all of our products except anhydrous. Kansas NH3 comes in at a statewide retail average of $403.60. Given the aggressive declines in Kansas this week, Kansas farmers might do well to consider taking advantage and forward booking some product for fall or spring... any product.

Fertilizer
7/6/20
7/13/20
Change
Current Week
Fertilizer
Anhydrous
$492.11
$492.1
-$1.08
$491.03
Anhydrous
DAP
$420.48
$421.47
-$1.46
$420.02
DAP
MAP
$414.83
$414.95
-36 cents
$414.49
MAP
Potash
$355.29
$355.72
-81 cents
$354.91
Potash
UAN28
$237.83
$237.75
-65 cents
$237.10
UAN28
UAN32
$267.41
$267.74
-$2.06
$265.38
UAN32
Urea
$366.79
$366.87
-$1.86
$365.01
Urea
Composite
528.26
528.54
-1.89
526.65
Composite

Corn Futures

  • December 2021 corn futures closed Friday July 17 at $3.67 putting expected new-crop revenue (eNCR) at $605.34 per acre, down $7.08 on the week.
  • With our Nutrient Composite Index (NCI) at 526.65 this week, the eNCR/NCI spread narrowed 5.19 points and stands at -78.69.

Nitrogennitrogen indices chart

  • UAN32% led declines in the nitrogen segment with Kansas off $10.30 and Wisconsin falling $2.77 on the week. Nebraska firmed just 37 cents per short ton. All other states were unchanged on 32%.
  • Urea was led lower by Kansas, which fell $24.00 per short ton with Minnesota off an even dollar. South Dakota dropped a dime and Wisconsin firmed 9 cents. No other state posted a price change.
  • Anhydrous ammonia fell with Michigan off $13.20, Kansas down $1.70 and Ohio shucking 31 cents per short ton. Nebraska was our sole gainer in NH3 this week, up $2.29.
  • UAN28% was down slightly on the week with Kansas off $8.75 and Minnesota down 79 cents. Wisconsin firmed $1.38 and South Dakota gained 37 cents per short ton.

Phosphatep and k indices chart

  • Phosphates acted similarly with both DAP and MAP off slightly amid very few state to state price changes.
  • DAP was lower on a $9.75 cut in South Dakota, a $7.18 decline in Kansas and a $1.33 price slump in Minnesota. Wisconsin posted the only higher price this week, up $2.25.
  • MAP was lower as well with Kansas off $9.95, Minnesota off $1.85 and South Dakota down all of two cents per short ton. Nebraska gained $4.18 and Wisconsin firmed $3.36 per short ton.
  • According to MosaicCo., wholesale phosphate prices were mixed but mostly moderately higher at U.S. terminals in the week ended July 17.

Potash

  • Potash fell slightly this week with Kansas down $4.60, Wisconsin falling $3.92 and Minnesota off $2.27. Nebraska firmed $2.74 per short ton on the week.
  • According to MosaicCo., wholesale potash was a wash, firming $1 at NOLA and falling $1 in the Corn Belt during the report week.

Nutrient Composite Index Chart


 

 

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