DTN Retail Fertilizer Trends

OMAHA (DTN) -- Average retail fertilizer prices were fairly steady the second week of July 2014, as has been the case in recent weeks, according to fertilizer retailers surveyed by DTN. However, retailers report this steadiness in the fertilizer market could be changing with commodity prices shifting lower.

Seven of the eight major fertilizers were lower compared to last month, though none were down significantly.

DAP had an average price of $591 per ton, MAP $621/ton, urea $531/ton, 10-34-0 $561/ton, anhydrous $686/ton, UAN28 $348/ton and UAN32 $399/ton.

UAN32 prices fell through the $400-per-ton level for the first time since the first week of April 2014. That week, the average price for UAN32 was $398 per ton.

The remaining fertilizer, potash, was higher compared to the previous month, but again the move higher was fairly muted. Potash's average price was $483/ton.

On a price per pound of nitrogen basis, the average urea price was at $0.58/lb.N, anhydrous $0.42/lb.N, UAN28 $0.62/lb.N and UAN32 $0.62/lb.N.

With commodity prices falling considerably in recent weeks, it stands to reason that at some point retail fertilizer prices will also begin to retreat some. While DTN retail fertilizer prices have not reflected any substantial changes yet, retailers believe lower prices could be coming soon.

Royce Bialas, location manager for Central Farmers Cooperative in Dimock, S.D., said his educated guess is fertilizer prices will be about 20% lower by the time the fall fertilizer season begins, as fertilizer will follow commodity prices lower. Fertilizer now in the $500-per-ton range could be closer to $350 to $400 per ton after the drop, he estimated.

"The late-summer/fall fill will be weaker as far as price goes," Bialas said. "You can't have corn prices fall this much and not have fertilizer prices drop right along with it."

Bialas said the wild card in lower retail fertilizer prices could be natural gas prices, which have been stronger earlier this year. Higher natural gas prices could work against lower fertilizer prices, but ultimately, the fall of the commodity market will most likely push retail fertilizer lower, he said.

"Maybe I am too logical, but these fertilizer prices with the much lower commodity prices do not work with profitability," Bialas said. "At some point, probably soon, retail prices have to get back in line with corn prices."

Although fertilizers have been moving higher in recent months, half of the eight major fertilizers are now double digits lower in price compared to July 2013.

DAP is now down 1%, urea is 2% less expensive and MAP is 4% less expensive. 10-34-0 is down 6% while both UAN28 and UAN32 are now 10% lower. Anhydrous is now 14% less expensive while potash is down 16% compared to a year earlier.

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 November 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
Aug 5-9 2013	570.04	605.95	554.91	499.16
Sept 2-6 2013	557.89	592.05	525.57	472.44
Sep 30-Oct 4, 2013	528.55	567.00	496.45	442.51
Oct 28-Nov 1 2013	523.36	564.75	491.07	441.02
Nov 25-29 2013	516.85	556.86	485.93	439.27
Dec 23-27 2013	496.17	525.86	477.84	449.69
Jan 20-24 2014	510.00	536.63	471.71	488.90
Feb 17-21 2014	535.55	559.68	472.27	519.11
Mar 17-21 2014	541.13	561.43	472.44	521.67
Apr 14-18 2014	586.08	617.31	475.35	552.05
May 12-16 2014	594.90	630.50	479.36	554.53
June 9-13 2014	594.89	630.38	482.44	540.98
July 7-11 2014	590.78	620.65	483.28	531.43
LIQUID
Date Range	10-34-0	ANHYD	UAN28	UAN32
Aug 5-9 2013	584.84	699.87	360.51	412.64
Sept 2-6 2013	547.98	683.64	339.93	385.09
Sep 30-Oct 4, 2013	523.14	652.60	322.21	368.53
Oct 28-Nov 1 2013	519.29	653.36	321.39	368.60
Nov 25-29 2013	516.31	644.79	320.12	364.75
Dec 23-27 2013	507.53	624.84	317.10	363.75
Jan 20-24 2014	498.30	616.24	331.83	374.28
Feb 17-21 2014	509.21	620.03	340.83	386.60
Mar 17-21 2014	509.47	620.96	341.37	387.11
Apr 14-18 2014	524.72	684.72	354.44	400.79
May 12-16 2014	551.66	698.63	354.96	405.75
June 9-13 2014	561.88	702.80	357.13	404.87
July 7-11 2014	561.03	686.30	347.51	399.06

Russ Quinn can be reached at russ.quinn@dtn.com

(AG/SK)

Copyright 2014 DTN/The Progressive Farmer. All rights reserved.