DTN Retail Fertilizer Trends

By Russ Quinn
DTN Staff Reporter

OMAHA (DTN) -- Retail fertilizer continues to drift lower as the year comes to an end, according to retail fertilizer prices tracked by DTN for the fourth week of December 2015. Some farmers report making fertilizer purchases before year's end, although many are planning to hold off buying.

All eight of the major fertilizers edged lower compared to a month earlier, but none were down significantly. DAP had an average price of $519 per ton, MAP $541/ton, potash $408/ton, urea $390/ton, 10-34-0 $571/ton, anhydrous $608/ton, UAN28 $277/ton and UAN32 $330/ton.

On a price per pound of nitrogen basis, the average urea price was at $0.42/lb.N, anhydrous $0.37/lb.N, UAN28 $0.50/lb.N and UAN32 $0.52/lb.N.

A quick survey of farmers on Twitter finds many different responses to the traditional year-end fertilizer purchasing for tax purposes.

Joel Grams (@uplandcounty), a farmer from Minden, Nebraska, said he didn't apply any fertilizer last fall and he also has not locked any fertilizer in yet. He will lock in some fertilizer in the coming months, but nothing before the end of the year.

"I need some expenses for the end of the year, but not enough to pay for fertilizer," Grams told DTN.

Quentin Bowen (@thegraingrower), a farmer from Humboldt, Nebraska, said he normally prepays for his fertilizer the summer before. However, the last two years he waited until he needed the fertilizer, thinking it was overpriced.

"Last year it never went down; this year it seems to be working down a little," Bowen said.

Bowen said he believes consolidation in the fertilizer industry has kept prices higher than they should be. Until something happens to turn commodities bullish, he feels the fertilizer companies are bucking the trend of the whole world by not deflating their prices.

"I will buy it when I need it, if I don't see an opportunity before," he said.

Not all farmers are declining to purchase fertilizer. Josh Kayser (@bigkyz), a farmer from Emery, South Dakota, said he is about half bought on phosphorus (P) and potash (K). He already applied P and K last fall.

Kayser said he will probably lock in at least 75% of remaining fertilizer needs in the next month or so.

"We are waiting for our retailers to call the bottom (of the fertilizer market)," Kayser said. "Urea is still sliding (lower) in our market."

With retail fertilizer moving lower in recent months, no fertilizers are higher compared to a year earlier. The closest would be 10-34-0, which is now 1% lower from last year.

The remaining seven nutrients are all lower compared to retail prices from a year ago. DAP is 8% lower while both MAP and UAN32 are 9% less expensive. UAN28 is 13% lower, anhydrous is 14% less expensive and both potash and urea are 16% lower compared to a year previous.

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):

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

(MZT/AG)

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