Fertilizer prices

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dun

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After increasing for six consecutive years, U.S.fertilizer prices are finally beginning to fall at the wholesale level, according to a report by the American Farm Bureau Federation.

“Up until very recently, fertilizer prices were astronomical at both the wholesale and retail level,” said AFBF senior economist Terry Francl. “Fertilizer producers were clearly reacting to record commodity prices, and companies priced their products accordingly.”

Now that prices for corn, soybeans and other commodities have declined 50 percent or more from summer peaks, wholesale prices for fertilizer are dropping as well, but retail prices have yet to fall. Francl said the wholesale fertilizer price drop began about two months ago, generally after the time farmers applied fall fertilizer to their crops.

Wholesale prices for anhydrous ammonia in the Corn Belt have declined from the $1,000 per-ton-plus range to the $500 range. Urea has dropped from the mid-$800 range to the mid-$300 range. Diammonium Phosphate (DAP) has declined from $1,100 to $600 per ton. The decline in potash prices has been less notable, dropping from a little over $900 per ton to slightly over $800.

“The reasons for the decline involve much more than just crop prices. Natural gas prices have declined from more than $11 per million BTUs (1,000 cubic feet) to around $6 per million BTUs. Natural gas is the primary input utilized to manufacture anhydrous ammonia and typically accounts for 80 percent to 90 percent of all input costs,” Francl explained in AFBF’s December Market Update report.

“Anhydrous ammonia, in turn, is the basic feedstock for nearly all the other nitrogen fertilizers. So, the cost of production of the entire nitrogen complex has waned considerably. There are similar declines in phosphate production and lower sulfur and phosphate rock prices.”

Potash prices appear to be retreating much slower, if at all, because more than 90 percent of the potash used in this country is imported, mostly from Canada, but also from some European and former Soviet Union countries. Potash prices are therefore more affected by changes in the value of the dollar, which has declined recently, meaning that it makes imports more expensive.

Francl said fertilizer dealers with large, high-priced inventories could be in a difficult position this spring due to indications by farmers that they plan to plant less fertilizer-intensive crops, such as corn and cotton, and plant more soybeans which don’t use nitrogen at all, since legumes actually add nitrogen to the ground.

To compete, fertilizer dealers will have to “cost average their prices down” by averaging their current high-priced inventories with lower-priced future inventories, Francl said. “Farmers would be well-advised to hold off their spring purchases for as long as possible. The inherent danger in such a strategy is that a spring rush may cause supply bottlenecks. However, nitrogen products can be applied to row crops in the form of side-dressing later in the spring,” Francl said.

Source: American Farm Bureau Federation
 

KenB

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dun":27whz0ub said:
After increasing for six consecutive years, U.S.fertilizer prices are finally beginning to fall at the wholesale level, according to a report by the American Farm Bureau Federation.

“Up until very recently, fertilizer prices were astronomical at both the wholesale and retail level,” said AFBF senior economist Terry Francl. “Fertilizer producers were clearly reacting to record commodity prices, and companies priced their products accordingly.”

Now that prices for corn, soybeans and other commodities have declined 50 percent or more from summer peaks, wholesale prices for fertilizer are dropping as well, but retail prices have yet to fall. Francl said the wholesale fertilizer price drop began about two months ago, generally after the time farmers applied fall fertilizer to their crops.

Wholesale prices for anhydrous ammonia in the Corn Belt have declined from the $1,000 per-ton-plus range to the $500 range. Urea has dropped from the mid-$800 range to the mid-$300 range. Diammonium Phosphate (DAP) has declined from $1,100 to $600 per ton. The decline in potash prices has been less notable, dropping from a little over $900 per ton to slightly over $800.

“The reasons for the decline involve much more than just crop prices. Natural gas prices have declined from more than $11 per million BTUs (1,000 cubic feet) to around $6 per million BTUs. Natural gas is the primary input utilized to manufacture anhydrous ammonia and typically accounts for 80 percent to 90 percent of all input costs,” Francl explained in AFBF’s December Market Update report.

“Anhydrous ammonia, in turn, is the basic feedstock for nearly all the other nitrogen fertilizers. So, the cost of production of the entire nitrogen complex has waned considerably. There are similar declines in phosphate production and lower sulfur and phosphate rock prices.”

Potash prices appear to be retreating much slower, if at all, because more than 90 percent of the potash used in this country is imported, mostly from Canada, but also from some European and former Soviet Union countries. Potash prices are therefore more affected by changes in the value of the dollar, which has declined recently, meaning that it makes imports more expensive.

Francl said fertilizer dealers with large, high-priced inventories could be in a difficult position this spring due to indications by farmers that they plan to plant less fertilizer-intensive crops, such as corn and cotton, and plant more soybeans which don’t use nitrogen at all, since legumes actually add nitrogen to the ground.

To compete, fertilizer dealers will have to “cost average their prices down” by averaging their current high-priced inventories with lower-priced future inventories, Francl said. “Farmers would be well-advised to hold off their spring purchases for as long as possible. The inherent danger in such a strategy is that a spring rush may cause supply bottlenecks. However, nitrogen products can be applied to row crops in the form of side-dressing later in the spring,” Francl said.

Source: American Farm Bureau Federation
:clap: :clap: :clap: :clap: I sure hope to see it in the retail end in my locale, corn prices are down but that hasn't showed up in the price they charge around here.
 

1982vett

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I've heard that prices have fallen some. Won't need any till mid-March (if it starts raining). Getting ready to top off the diesel tanks after the first of the year too.
 

KenB

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The price of oil is down but not the price of motor oil or hydraulic fluid etc. It sure went up in price when oil went up. :mad:
 

hillrancher

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I do hope the fertilizer prices decrease. We use poultry litter for most of our fertilizer. In the past we were paying 6.00 per ton for it. It has gone up to 20 per ton because it is bought by farmers in Iowa northern Mo. and southern Ark. and shipped to corn and rice. Also Oklahoma farmers are buying in the west of us they on are paying 12 per ton.
I haven't determined the top price I should pay for litter before reverting to fertilizer yet. I have estimated that N should be 300 per ton or less before using fertilizer. Has anyone got any ideas?
 

Angus Cowman

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I use litter also and I pd $36 pr ton del and spread this fall, the way I figure fert has to be at $450-$475 pr tn to be cheaper. I had a analysis done on mine and the University of Mo says I am getting $5 per acre of trace min that you can't get with comm fert, I also like the slow release and the composting quality it adds not to mention the ph stabilization in the soil
 

Stocker Steve

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hillrancher":3uf6yjev said:
I haven't determined the top price I should pay for litter before reverting to fertilizer yet. I have estimated that N should be 300 per ton or less before using fertilizer. Has anyone got any ideas?

Test it!
There is a huge variation in value depending on the type and amount of bedding. Up here folks use straw or sunflower hulls or wood chips...
 

Angus Cowman

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KenB":nkdp8o38 said:
I read where chicken litter= 3N-3P-2K pounds per hundred of litter.
I use turkey and it is supposed to be better but on our test we were getting 70lbs of N per ton, 80lbs of P and 65lbs of K so I would think what you posted is pretty close
also they wetter the litter(fresher) it is the more N it will have
 

ksl1

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We have used turkey manure before and plan to use it again. I was told "the more it stinks, the better it is". If you can get it out of the "grow out" barns(the older turkeys) it has very little bedding in it. It is almost pure manure. Around here they only clean the grow out barns every couple years.
 

hillrancher

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ksl1":3uyzq4ty said:
We have used turkey manure before and plan to use it again. I was told "the more it stinks, the better it is". If you can get it out of the "grow out" barns(the older turkeys) it has very little bedding in it. It is almost pure manure. Around here they only clean the grow out barns every couple years.

The more it stinks is more moisture in it or it is wet.
They are not cleaning out complete here any more. The last two years all we get is 100% chicken do du no rice hulls, straw or sawdust.
 

1982vett

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Caustic Burno":2z2nevos said:
Checked today urea was at 320 a ton .
Almost sounds unbelieveable. Hope it stays that way or goes down some more. That and $2.00 offroad diesel makes things look better.
 

KenB

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1982vett":3qfyf53x said:
Caustic Burno":3qfyf53x said:
Checked today urea was at 320 a ton .
Almost sounds unbelieveable. Hope it stays that way or goes down some more. That and $2.00 offroad diesel makes things look better.

I bought highway diesel for $2.19 today. :clap: Hydraulic oil was $40 for 5 gal. it was $32 2 months ago. :???: :mad:
 

dcara

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I paid $1.99 for on-road diesel yesterday at a Valero station in front of a Walmart in Greenville TX. Not 2 miles down the same road was another Valero Station and the price on the sign said $2.59!? A couple of blocks over was another Valero and the price on their sign was $2.18. All of this was in the context of about $1.40 regular gas.
 

gabby

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Yesterday my fertilizer dealer took delivery on a load of 24 tons of 65% (?) Potash for over $20,000 his cost. He says that is down about $100 per ton. Yippee. :roll:
 

ddg1263

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So no relief this year on our fertilizer cost? Dang.... :drink: :drink:
 

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