Weekly Fertilizer Bulletin | Nitrogen in a Nosedive

• Fertilizers were mostly lower with anhydrous ammonia and UAN28% sharply lower.
• Our Nutrient Composite Index softened 9.59 points to 545.15. This compares to our 5-year average of 634.61 for this week.

Nitrogen

• Anhydrous ammonia led declines within the nitrogen segment and across the fertilizer spectrum this week.
• UAN28% took its cues from last week's 32% price action, falling sharply on the week.
• 32% was lower as well, and there is more downside potential as some states are still resetting bids.
• Urea joined its nitrogen brethren, falling about a buck-and-a-half on the week.
• Our forecast for declining nitrogen price into harvest is playing out as expected, but we will continue to wait on signs the downward swing is running out of steam before booking for fall.

Phosphate

• DAP fell less than one dollar on the week with Ohio posting a "no bid" suggesting refill is eminent in that state.
• MAP was higher but only by a few dimes.
• The DAP/MAP spread has corrected itself, coming in this week around $15.
• According to MosaicCo, wholesale DAP was sideways to higher at most U.S. terminals, and MAP firmed at NOLA in the week ended Aug. 31.
• While farmers have been known to cut back on P&K to maintain the production budget, fall P&K applications are quite popular which will likely keep a hard floor under phosphate prices, possibly until February.

Potash

• Potash was lower on the week, led by North Dakota.
• MosaicCo reported steady to higher U.S. wholesale potash for the reporting week.
• Potash is at a hefty premium to NH3 when considered on an indexed basis, which either suggests NH3 is underpriced, or that potash is overpriced. But, as with phosphates, potash demand will likely outstrip nitrogen demand for fall applications, possibly propping prices up until seasonal demand is exhausted.

Corn Futures

• December 2019 corn futures closed Friday August 31 at $3.94 putting expected new-crop revenue (eNCR) at $638.37 per acre -- up $3.46 per acre on the week.
• With our Nutrient Composite Index (NCI) at 545.15 this week, the eNCR/NCI spread widened 37.98 points and now stands at -93.22.