Inputs Monitor Regional Index: The Business End of a Bear Market

February 17, 2014 05:57 AM

Declines tallied 2 3/4 cents to gains' $45.86 in the regional averages. Big movers are MAP, and urea which are both roughly fifteen bucks higher on the week. LP and farm diesel made our only downside moves this week.IMG 0426

Nutrient's bear run appears to be over. We have watched regional average prices creep higher -- first by a few cents in some cases and then a dime or so the following week. But each week, the rate of increase quickens and this week nutrient gains add up to $45.86. That's after adding a good twelve bucks last week.

Our readers are currently 80% filled on phosphate, UAN and urea, 60% on anhydrous ammonia, 80% on potash and 50% on farm diesel for the upcoming planting season. If we can get another downside blip from farm diesel next week we will likely reward the setback and increase coverage for spring and summer. Declines in LP are due to the prioritization of propane pipeline shipments into the Midwest and flows from Cushing to Conway, Kansas for Midwestern distribution.

Corn Futures --

December 14 corn futures closed Friday at $4.59 3/4 -- that's 1/4 cent below the previous Friday's close, putting expected new-crop revenue 32 cents softer on the week at $695.68. With anhydrous priced at $648.52 this week, the ZCZ/NH3 spread narrowed 2.95 points and now lies at -47.16.

The ZCZ/NH3 spread is thinning in the same way nutrient prices are elevating -- a little bit at a time. Corn futures seem to want to hold in place for the time being, and that may give fertilizer prices a change to gain some ground. The implication is for higher nutrient prices next week, anhydrous in particular.

On that basis you will be hard pressed to find a better time to cover anhydrous for spring. We are currently at 60%. If you are not that far with bookings, get caught up today. We are in no hurry to fill the remaining 40% for spring. Wholesale ammonia continued sideways at $415 this week and we will wait for wholesale prices to indicate a hard bounce and finish our spring/summer fill at that point.


Regionally --

Anhydrous firms $1.63 to $648.52; UAN28 $4.26 higher week-over to $342.42; UAN32 firms $3.26 to $368.09; Urea $16.39 higher to $503.62.

DAP $4.43 higher to $528.50; MAP $13.32 higher to $556.20. Potash firms $2.57 to $464.75.

Farm diesel softens 3/4 cent to $3.46 1/2 -- now 2 1/2 cents below year-ago. LP softened 2 cents to $3.79 -- now $2.30 cents above year-ago.

Week-over Change
Current Week
Farm Diesel
$3.46 3/4
$3.47 1/4
-3/4 cent
$3.46 1/2
- 2 cents






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