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P&K Today: Weak Demand Limits Prices, Exports No Help

December 5, 2013
By: Davis Michaelsen, Pro Farmer Inputs Monitor Editor

P&K retail prices were mixed again on the week with MAP and Potash moving higher as DAP softened slightly.blizzard

Winter slammed the door on applications in the northern and southern parts of the Corn Belt. Those areas are now covered in snow, but a stripe across the nation's midsection extending from western Iowa to points east missed the worst of the snow and despite frigid temperatures, may give growers another quick swing at a fall application.

MosaicCo reports brisk domestic phosphate shipments in the month of October which tallied a 7 percent increase above last year. That equates to a 42 percent increase over October's seven-year average. Exports to Brazil topped expectations in October and are up 60 percent from year-ago. However, year-to-date phosphate exports to India are currently off 46 percent from the previous year.

Despite low prices, P&K continue to struggle for U.S. demand. Between lagging phosphate exports, workforce reductions at PotashCorp and a great deal of carry in the market, the upside is currently limited on P&K to seasonal increases.

We have been waiting for the price declines to run out, and as the downside freight train grinds to a slow stop, prices may do little more than just lie at current levels with moderate seasonal upside potential. If sendouts to India do not recover, there may be a lot of P&K in-stream around the United States come spring, especially if the weather hampers fall applications.

This week --

  • DAP $130.12 below year-ago pricing -- down $4.59 on the week to $527.55/st.
  • MAP $110.27 below year-ago -- up $1.29 this week to $558.90/st.
  • Potash $122.11 below-year ago -- up 42 cents this week to $482.39/st.
  • December 2014 corn futures opened 9 3/4 cents higher this morning than last week's P&K Today at $4.63 3/4 with the national average cash corn price 12 3/4 cents higher from last week at $4.34 3/4. Corn basis moved back below futures pricing to stand at 1 3/4 cents below March 2014 futures.

By the Pound --

DAP 1/2 cent lower to 55 1/2 cents/lbP2O5; MAP firms 1/4 cent to 52 1/2 cents/lbP2O5; Potash moved 1/4 cent higher on the week to 40 cents/lbK2O.

The following is an updated table of P&K pricing by the pound as reported to your Inputs Monitor for the week ended Nov.29, 2013.

P&K pricing by pound -- 12/05/2013

DAP $P/lb

MAP $P/lb
Potash $K/lb
Iowa
$0.58
$0.54
$0.40
Illinois
$0.55
$0.52
$0.40
Indiana
$0.56
$0.53
$0.39
Wisconsin
$0.54
$0.56
$0.38
Minnesota
$0.56
$0.54
$0.40
South Dakota
$0.55
$0.50
$0.40
North Dakota
$0.56
$0.50
$0.39
Nebraska
$0.51
$0.52
$0.46
Missouri
$0.53
$0.51
$0.39
Kansas
$0.56
$0.53
$0.42
Ohio
$0.53
$0.51
$0.40
Michigan
$0.62
$0.53
$0.38
Average
$0.55 1/2
$0.52 1/2
$0.40
Year-ago
$0.69
$0.62
$0.50

Wholesale --

MosaicCo reports wholesale DAP moved $2.00 lower at Tampa, moved sideways at Morocco and Central Florida and ran slightly higher in NOLA. MAP added $2.00 at Brazilian terminals. Wholesale potash softened in the Corn Belt and ran sideways in Southeast Asia and Brazil. Raw phosphate rock from Morocco is fell $5.00/tonne and Tampa ammonia held firm at $450/ton.

The Percentages Year-over --

The figures below give us insight into where prices were last year at this time compared to today's price by percentage. These numbers will shrink in a hurry in the event of a rally, but because corn futures are ranging much lower than year-ago, price strength will be limited until new-crop returns improve.

The year-on-year potash margin was unchanged from last week to stand 20.2% below year-ago; DAP added 0.6% to the year-on-year differential to 19.7% below year-ago; MAP narrowed the gap by 0.2 % to 16.4% below last year's price, and anhydrous widened the year-over gap by 0.1% during the week to end at 23.2% below last year's price at this time.

 
Current regional average price/short ton
Percent of year-ago
Potash
$482.31
-20.2%
DAP
$527.55
-19.7%
MAP
$558.90
-16.4%
NH3
$667.72
-23.2%

 


Blizzard photo credit: ldandersen / Foter.com / CC BY-NC

 

 

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