Tue Oct 21, 2014 08:29 AM CDT
DTN Retail Fertilizer Trends 10/21 08:29 Fertilizer Prices Remain in Limbo Standoff between high-priced fertilizer and depressed corn prices has some growers changing tactics for 2015 crops. By Cheryl Anderson DTN Staff Reporter OMAHA (DTN) -- As harvest progresses, retail fertilizer prices tracked by DTN for the third week of October continue on an level trend, remaining steady with very little price movement. DAP, MAP, potash, 10-34-0 and anhydrous were slightly higher in price compared to a month previous while urea, UAN28 and UAN32 were a little lower. Neither group featured a significant move in either direction. DAP had an average price of $583/ton, urea $508/ton, UAN28 $326/ton and UAN32 $372/ton. MAP had an average price of $599/ton, potash $477/ton, 10-34-0 $557/ton and anhydrous $696/ton. On a price per pound of nitrogen basis, the average urea price was at $0.55/lb.N, anhydrous $0.42/lb.N, UAN28 $0.58/lb.N and UAN32 $0.58/lb.N. Tight 2015 budgets are causing growers to scrutinize all expenses, especially big-ticket items like fertilizer, seed and rent. Bret Davis, a farmer from Delaware, Ohio, has purchased fertilizer for the coming year and has some already applied. Davis and his stepson farm about 3,800 acres on a 50/50 rotation of corn and beans. Davis said he didn't cut back on fertilizer costs this year, since he had good yields and actually paid less for fertilizer this year than last. But other farmers in the area are not taking the same strategy. "Some guys around me don't intensively sample like I do," he said. "A lot of guys are talking about trying to cut costs and saving every dollar they can." Davis said he uses intensive grid-sampling and variable-rate fertilizer application. "Every half acre we have a soil sample and every half acre it changes, depending on what the need is," he said. "That way we put the right amount on the right place." Right now, Davis is putting on enough fertilizer for two years on bean ground going into corn, and will have enough for a year of corn and a year of beans. "I am on a two-year rotation and try to stay with that," he said. "I've gone ahead and put on what I had planned on doing." Brad Thykeson is taking another approach to dealing with high fertilizer costs and low commodity prices. Thykeson farms more than 8,000 acres near Portland, N.D. Rather than cutting back on inputs, which he describes as "shooting yourself in the foot," Thykeson will likely change his crop rotation next year in order to curb costs. "We have been more heavy-handed in corn, but looking forward to 2015, all of a sudden we are looking at crops that don't need as many inputs," he said. "Crops like edible beans, wheat or soybeans that don't require a lot of fertilizer." Although a lot of product has been applied with favorable fall weather, Thykeson said, farmers are really in a wait-and-see mode as far as buying/locking in fertilizer for next year, and are choosing to pay-as-they-go with fertilizer purchases. "Our working capital is not what it was a year ago because of commodity prices," he said. "Forecasting for 2015 with high fertilizer prices is going to be a hard thing do pencil out. "Many are choosing to wait and see, and hopefully we will see a fall in input costs and a rise in commodity prices." Thykeson expects fertilizer prices will fall when usage goes down. "There is very limited upside potential in commodity prices," he said. "There is definitely more downside potential in the fertilizer market." Two of the eight major fertilizers are now double-digits higher in price compared to October 2013, all while commodity prices are significantly lower from a year ago. Urea remains up 15% compared to year earlier, followed by DAP 11% more expensive. In addition, 10-24-0 is up 7% from a year ago, MAP and anhydrous are each up 6% and UAN28 and UAN32 are both just 1% higher. Potash remains the only nutrient which is still lower compared to retail prices from a year ago, coming in at about 3% lower than a year ago. DTN collects roughly 1,700 retail fertilizer bids from 310 retailer locations weekly. Not all fertilizer prices change each week. Prices are subject to change at any time. DTN Pro Grains subscribers can find current retail fertilizer price in the DTN Fertilizer Index on the Fertilizer page under Farm Business. Retail fertilizer charts dating back to Nov. of 2008 are available in the DTN fertilizer segment. The charts included cost of N/lb., DAP, MAP, potash, urea, 10-34-0, anhydrous, UAN28 and UAN32. DTN's average of retail fertilizer prices from a month earlier ($ per ton): DRY Date Range DAP MAP POTASH UREA Nov 11-15 2013 515.93 564.43 489.75 441.10 Dec 9-13 2013 505.69 546.69 483.20 441.68 Jan 6-10 2014 492.78 513.09 474.08 458.30 Feb 3-7 2014 521.24 550.48 470.01 502.95 Mar 3-7 2014 553.29 569.88 473.86 531.25 Mar 31-Apr 4 2014 578.78 599.25 474.61 546.33 Apr 28-May 2 2014 597.13 624.99 476.43 559.75 May 26-30 2014 595.94 630.78 480.02 551.35 June 23-27 2014 594.83 629.02 483.44 535.42 July 21-25 2014 585.40 617.46 482.98 527.46 Aug 18-22 2014 586.52 607.17 475.65 516.29 Sept 15-19 2014 580.21 598.02 475.17 509.45 Oct 13-17 2014 582.58 599.11 477.15 508.02 LIQUID Date Range 10-34-0 ANHYD UAN28 UAN32 Nov 11-15 2013 518.83 644.82 320.70 367.75 Dec 9-13 2013 514.50 634.59 318.17 360.82 Jan 6-10 2014 504.68 619.42 318.90 364.24 Feb 3-7 2014 498.31 617.23 334.24 381.71 Mar 3-7 2014 510.67 622.25 343.38 388.53 Mar 31-Apr 4 2014 514.88 659.53 351.01 395.53 Apr 28-May 2 2014 535.72 695.14 355.65 403.11 May 26-30 2014 558.90 702.05 355.65 406.38 June 23-27 2014 562.15 700.44 354.58 402.79 July 21-25 2014 561.56 683.14 345.14 393.96 Aug 18-22 2014 555.46 698.82 332.67 377.29 Sept 15-19 2014 554.26 692.97 328.86 376.49 Oct 13-17 2014 556.89 695.59 326.27 372.26 Cheryl Anderson can be reached at (MZT/SK) Copyright 2014 DTN/The Progressive Farmer. 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