CROP PRODUCERS: Cover a Portion of Spring Urea & UAN, Improve Tax Position

December 4, 2013 07:24 AM

  • Get current with spring urea coverage at 20%-40% of spring needs.
  • Consider covering 30% of spring UAN solutions.
  • Production features, lagging exports and potential strength in near-term commodity prices suggest upside potential for urea.
  • Annual runup looms, look to cover portions for spring needs against winter price increases to improve tax position.
  • Click here for more...


Urea -- We advised 20%-40% coverage on urea for spring in October but the clear consensus is that a lot of product has not yet been booked. Prices are expected to move higher through the winter and retreat slightly after the spring rush, but high demand will likely hold prices above today's peg. Take advantage of current pricing as nutrient is overdue for its annual run higher.

Trends suggest UAN solutions will follow urea higher and we have recommended 30% coverage on solutions for spring. We will look to book sidedress nutrient in the spring.

Get current on urea and solutions and consider buying now ahead of a nitrogen price recovery as a way to improve your tax position.

Click here for the details in today's Monitor article 'Urea Puts in a Hook'.

Position Monitor -- If you are already at these levels, HOLD.

Inputs Position Monitor
Farm Diesel
Natural gas
Fall 2013 100% 100% 100% 100% 100% 100% 100% 100% 100% 100%
Spring 2014 30% 20% 20% 20% 30% 30% 20%-40% 20% 0% 0%

Prices may vary so, as always, check with your preferred supplier.


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