Earlier this week, spot prices for DAP fertilizer at New Orleans hit a record ratio compared with corn prices. Tracked by Josh Linville, vice president of fertilizer at Stone X, he reported how a $820 barge of DAP compared to December new crop corn at $4.4575 per bushel, and how that DAP:corn ratio was 184 an all-time high based on his data.
Since the week has progressed, the weekly average notched slightly lower so that moment in time fell from the historic high. However, Linville says prices are flirting at the elevated levels near the record.
“Today’s relationship is nearly level with the worst ratio set in 2008 for this time of year,” he says. “It’s less than 5 bu. from the worst.”
Overall, current fertilizer prices are accounting for 40% of farmers’ cost of production.
Phosphate price trends are leading the pack compared to nitrogen and potash. While nitrogen and potash application rates are higher, the critical role phosphate plays in crop production is putting its high price at the top of lists of concerns.
Adding to the phosphate worries, in addition to its upward pricing trends, sourcing the nutrient is a long-term process. Regarding increases in future production, Linville says, “Hope is on the horizon, but it’s years off, not months.”
So what two global market dynamics could make “horrible” prices less terrible?
1. China could re-enter the global market.
Since the end of the 2024, China has cut off its exports of phosphate. The country used to add up to 8 million tons to the global fertilizer market pre-COVID-19. And China was the second-largest global phosphate exporter as recently as 2023.
“We have heard China talk about a 4.5-million-ton export quota for the year,” Linville says.
He adds, “China’s approach has been one of being in it for themselves. And not participating in the global market hurts every farmer, including those in the U.S., who have to deal with the volatility that has occurred.”
2. Peace deal between Russia and Ukraine
“While not specific to phosphate, the war ending between Russia and Ukraine would be the first domino to fall for the nitrogen market to be more ‘normal,’” Linville says.
Russia is the top global exporter of urea and UAN.
“If we are able to see reliable trade flow after a peace deal is struck, the global market could possibly return to normal distribution and destinations for product, which could have an effect across all of fertilizer,” Linville says.
Could high prices be a catalyst for product change?
With high MAP and DAP prices, recently introduced product formulations are positioned for greater adoption due to their improved efficiencies.
Ron Restum, chief commercial officer at Ostara, says the current swell in phosphate prices presents the opportunity for farmers to think differently about the products they use.
“Farmers need to be focused on efficiency,” he says. “In this chaotic time, farmers could be inclined to skip or reduce rates for nutrient application. But instead of cutting back, farmers can take an opportunity to do it better, more efficiently.”
Restum is referring to Ostara’s product, Crystal Green. With a formulation of 7-33-0 with 9% Mg, Crystal Green is acid soluble, which leads to on-demand use of the crop nutrients.
“Traditional MAP or DAP are only 10% to 30% efficient,” he says. “Farmers can’t afford to be inefficient. We recommend a reduced application rate because we provide over 90% efficiency.”
MAP and DAP applications are water soluble, and when applied, it quickly changes from high to low solubility, which is why only 10% to 30% is available the first year.
Both Crystal Green and RhizoSorb from Phosphosultions were developed to be similar to traditional MAP and DAP with application and spreadability. RhizoSorb 8-39-0 is a dry fertilizer product from Phospholutions, and it aims to increase plant phosphate uptake by 50%.
The company refers to it as MAP 2.0.
“This is the biggest thing since the 60s. There is no tech that has been able to help growers in this way,” says Craig Dick, vice president of sales and marketing at Phospholutions. “It arrives at the retail location ready to apply. It is the first technology to increase anionic exchange capacity, which leads to up to 33% less volume needed to be applied. And it’s based on plant-driven release, so up to 50% more phosphorus makes it into the plant.”
It’s been commercially distributed in the Corn Belt since 2024.