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Weekly Fertilizer Review
Nitrogen market remains combustible with farm pricing all over the map.
Compiled by staff
Published: May 23, 2012
International nitrogen prices continue to head in different directions depending on the product sought, with volatile crop markets are still blurring attempts to forecast profit margins for 2013. Retail prices remain all over the map, with mostly higher prices reported in Iowa this week.
Ammonia prices saw follow through buying last week after the big explosion out of the Black Sea the previous week. Prices rose another $9 a ton to around $512.47 suggesting the $495 May index price at the Gulf could be up $100 or more from current levels this summer. A $600 Gulf wholesale cost would keep retail prices north of $800, likely frustrating attempts to book product for the fall application season if corn prices continue to suffer. USDA put the average price for ammonia at $807 this week in Iowa, up $14.50, in a range from $780 to $853.
UAN edged lower at the Gulf, though it’s still very expensive at $375. Prices for July are $100 cheaper, when demand for sidedressing will be over. Current fair value on the spot market is around $405 for 30% solution, with July down to $320. USDA put the average price in Iowa at $448 for 28%, up $28, while 32% came in at $459.50, down $21.
Urea prices continue to soften on international markets following the big spike this spring caused by very tight supplies in the U.S. Lower imports and big demand caused prices to spike, but they should be down sharply in coming weeks. While the Gulf price fell $25 to $605, July swaps were down to $420 a ton, with September at $405. That should take the retail price to $550 or less – in theory, at least. Urea prices remained explosive in Iowa this week, up $46 to$802 according to USDA. That matches price seen in the far western Corn Belt as well.
Download the complete report using the link below.
Senior Editor Bryce Knorr first joined Farm Futures Magazine in 1987. In addition to analyzing and writing about the commodity markets, he is a former futures introducing broker and is a registered Commodity Trading Advisor. He conducts Farm Futures exclusive surveys on acreage, production and farm management issues and is one of the analysts regularly contracted by business wire services before major USDA crop reports. Besides the Morning Call on www.FarmFutures.com he writes weekly reviews for corn, soybeans, and wheat that include selling price targets, charts and seasonal trends. His other weekly reviews on basis, energy, fertilizer and financial markets and feature price forecasts for key farm crop inputs. A journalist with 38 years of experience, he received the Master Writers Award from the American Agricultural Editors Association.
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Tagged: farm, usda, farm futures, wheat, soybeans
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needs to be a site that post uptodate prices so farmers can get a better deal
Posted by Anonymous on May 7 at 9:37 AM
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Sorry to post this explanation so late, but just noticed the question from NY farmer.
I provide three types of price information. First are the benchmark prices used internationally, out of the Black Sea, Middle East, Gulf, etc. Some of these prices are from actual trades, others will be for indexes used to settle swaps contacts.
Secondly, I look at retail prices paid by farmers. These vary widely by location.
Finally, I make projections of what "fair value" is currently for retail prices, based on the international market. In otherwords, if your dealer is buying fertilizer now, say, from the Gulf or out of the Black Sea, what would the normal cost to you be. This fair value price lets you decide if your local market is under or over valued.
-- Bryce
Posted by Anonymous on April 27 at 8:15 AM
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Dear, the file of the link is one week old. If possible, please, change to the new one, thanks, Nelson
Posted by Anonymous on April 17 at 8:29 AM
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New to this site, great info, thank you! Need help reconciling fert price data in today's WFR: Staff notes, "If [ammonia] is imported to the U.S. it could cost $475 a ton, $75 more than the current index price at the Gulf. Normally, this type of cost at the Gulf, $400 a ton, would mean $570 at the farm gate level, while the Black Sea cost would translate to $700 a ton." These two sentences seem wrought with contradiction: Black Sea Am imported to US could cost $475//$75 more than index//this ($400) cost at Gulf would mean $570 at farm gate//BSea cost translates to $700 a ton: so, my questions: i) what does the index measure, raw price of undelivered Ammonia?; ii) difference between Gulf "cost/price (??--seems to be used interchangeably) and farm gate is transportation expense?; and iii) and why would BSea cost translate to $700/ton if differential from Gulf index is $75, should be $75 more than the $570 price at farm gate Staff cites? I know my questions are due to my ignorance, but the data appear contradictory. Many thanks.
Posted by nyfarmer on March 29 at 11:24 AM
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I own several business beside the farm i run. I wish i could price everything i sell to the price of corn and beans?!? Can anyone say "price fixing" ? i thought that was illeagal?
Posted by Anonymous on February 10 at 8:39 AM
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Sorry to take so long responding. $5 corn translates to $685 ammonia, $525 urea, $665 DAP, $685 potash, given what we know about demand.
Posted by Bryce on October 26 at 10:05 AM
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What do your models suggest when using $5 corn and $10 beans?
Posted by Anonymous on September 22 at 4:23 PM
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