Nitrogen-Based Fertilizer Costs Continue to Spike


Russ Quinn, DTN Staff Reporter

OMAHA (DTN) — Urea and UAN prices continued to move higher the second week of April 2012, according to retail fertilizer prices tracked by DTN. With the early spring allowing farmers to begin planting corn, these forms of nitrogen are being applied, fertilizer retailers reported.

Five of the eight major fertilizers were higher. Urea was leading the way higher once again, as it has now for six weeks in a row. The nitrogen fertilizer was 15{fd15d42d1b024b97d6d50958be27cc8145b6addb99e015780abccf2984117bb0} higher compared to the second week of March and had an average price of $715 per ton.

Also significantly higher were the UAN solutions. Both UAN28 and UAN32 were 10{fd15d42d1b024b97d6d50958be27cc8145b6addb99e015780abccf2984117bb0} higher compared to a month ago. UAN28 had an average price of $415/ton while UAN32 was at $465/ton. UAN28 crossed the $400/ton mark for the first time since the second week of December 2011.

Potash and MAP prices were higher as well. Both fertilizers were up just slightly with potash having an average price of $661/ton while MAP was at $697/ton.

Prices for the remaining three fertilizers were lower compared to a month ago, but not significantly. DAP had an average price of $636/ton, 10-34-0 $786/ton and anhydrous $765/ton.

On a price per pound of nitrogen basis, the average urea price was at $0.78/lb.N, anhydrous $0.47/lb.N, UAN28 $0.74/lb.N and UAN32 $0.73/lb.N.

UAN solutions and urea are all higher but perhaps for different reasons, fertilizer retailers told DTN.

The UAN solutions are higher due to normal supply and demand with farmers taking advantage of ideal planting conditions and planting earlier than normal. Storm Sammon, location manager with Central Valley Coop located in Owatonna, Minn., said farmers in his southern Minnesota region are planting corn here in mid-April.

“We have some guys with a lot of corn planted and some with nothing planted,” Sammon said. “I think we will have some guys with a few more corn acres, and I think they are also feeding more fertilizer to their corn to make sure they have the yield.”

Sammon said the UAN application season is just beginning, which could support prices in the coming months. With farmers shifting to multiple trips across their fields to apply nitrogen in split applications, the window to apply UAN products to corn acres could stretch into June and maybe July, he said.

Urea continues to shoot higher with application occurring and also some major supply issues continuing to plague the dry fertilizer. The high-priced urea has some retailers who use the product not very happy with fertilizer manufacturers.

“I think there are some currently taking advantage of these high urea prices,” said one Indiana retailer. “I have had to purchase a few loads to finish up, and the price was significantly higher. I am not against companies making some money, but this is really pushing it.”

Four of the eight major fertilizers are still showing double-digit increases in price compared to one year earlier. Leading the way higher is urea. The nitrogen fertilizer is 48{fd15d42d1b024b97d6d50958be27cc8145b6addb99e015780abccf2984117bb0} higher compared to last year, while UAN28 jumped to 13{fd15d42d1b024b97d6d50958be27cc8145b6addb99e015780abccf2984117bb0} higher; potash is 12{fd15d42d1b024b97d6d50958be27cc8145b6addb99e015780abccf2984117bb0} more expensive and UAN32 is 11{fd15d42d1b024b97d6d50958be27cc8145b6addb99e015780abccf2984117bb0} higher compared to the second week of April 2011.

Two fertilizers have seen just slight price increases compared to a year earlier. Anhydrous is now 4{fd15d42d1b024b97d6d50958be27cc8145b6addb99e015780abccf2984117bb0} more expensive, and 10-34-0 is 3{fd15d42d1b024b97d6d50958be27cc8145b6addb99e015780abccf2984117bb0} higher looking back at last year.

The two remaining fertilizers, DAP and MAP, are now actually lower compared to one year ago. DAP is now 6{fd15d42d1b024b97d6d50958be27cc8145b6addb99e015780abccf2984117bb0} lower while MAP has decreased 1{fd15d42d1b024b97d6d50958be27cc8145b6addb99e015780abccf2984117bb0} in price.


© Copyright 2012 DTN/The Progressive Farmer, A Telvent Brand. All rights reserved.

Posted by DTN Permission by Haylie Shipp


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