P&K Today: Indiana Declines Weigh on Prices

October 31, 2013 07:05 AM
 

P&K retail prices fell during the report week based on strong downward movement in just a few states. We saw the same thing for nitrogen this week, but N movements included sharp upside moves in nearly as many states as declines. The case here is generally flat pricing regionwide with one or two states driving downward movement. But these deals are too good to pass up and we issued a very specific alert yesterday for five states (click here).

Mosaic announced the $1.2 billion purchase of CF Industries' phosphate segment complete with an ammonia supply deal from Trinidad, phosphate mines, a manufacturing plant and ammonia terminal. The ammonia will be dedicated to MosaicCo. phosphate production, and tables Mosaic's earlier plans to build a $1.1 billion Faustina, Louisiana ammonia production facility to service production of DAP/MAP and Triple Super.

boxThe potash dust-up earlier this year highlighted the dangers of too much fertilizer in one company's hands, but the negative press surrounding fertilizer oligopolies seems to have been lost in translation. As CF exits its phosphate interests, Mosaic has opted to delay projects in its potash segment citing unfavorable market conditions. What this has done is concentrated the influence of CF in nitrogen, PotashCorp in potash and MosicCo. in phosphate.

Rather than encouraging diversity among producers in the marketplace, this deal and all that goes with it further centralizes production and encourages oligopoly. As the market shrinks, fewer hands are in the pie. However, specialization is not a crime and as CF and Mosaic move forward, each believe they will be able to more profitably concentrate on their individual strengths, passing on the savings to American growers.

This week --

  • DAP $123.44 below year-ago pricing -- down $7.36 on the week to $526.73/st.
  • MAP $107.72 below year-ago -- down $11.68 this week to $556.70/st.
  • Potash $110.09 below-year ago -- up $7.34 to $486.15/st.
  • December 2014 corn futures opened today at $4.71 1/2 with the national average cash corn price down 10 1/2 cents from last week to $4.32 1/4.

 

By the Pound --

DAP 1 cent lower to 55 cents/lbP2O5; MAP unchanged at 53 1/4 cents/lbP2O5; Potash softens 1 1/4 cent by the pound to 40 cents/lbK2O.

The following is an updated table of P&K pricing by the pound.

P&K pricing by pound -- 10/24/2013

DAP $P/lb

MAP $P/lb
Potash $K/lb
Iowa
$0.59
$0.54
$0.41
Illinois
$0.55
$0.51
$0.39
Indiana
$0.56
$0.53
$0.39
Wisconsin
$0.57
$0.51
$0.38
Minnesota
$0.56
$0.54
$0.39
South Dakota
$0.55
$0.52
$0.42
North Dakota
$0.53
$0.54
$0.38
Nebraska
$0.50
$0.55
$0.43
Missouri
$0.57
$0.53
$0.40
Kansas
$0.55
$0.55
$0.43
Ohio
$0.53
$0.53
$0.40
Michigan
$0.55
$0.55
$0.38
Average
$0.55
$0.53 1/4
$0.41 1/4
Year-ago
$0.69
$0.62
$0.50

 

Wholesale --

MosaicCo reports DAP and map moved lower in the U.S. Corn Belt, Tampa, Morocco and all points between. More of the same for potash which fell across the board in wholesale sendouts on the week. Raw phosphate slid sideways and Tampa ammonia moved lower.

The year-over pricing margin widened this week for all four of the below nutrients in statewide averages. Potash firmed 1.2% from last week's 18.2% below year-over pricing to stand 19.4% below year-ago; DAP slid another 1.3% below year-ago to 18.9% below year-ago; MAP softened 1.7% to widen the year-ago margin to 16.2% below, and anhydrous shucked another 4.5% during the week to end at 21.4% below last year's price at this time.

 
Current price/short ton
Percent of year-ago
Potash
$486.15
-19.4%
DAP
$526.73
-18.9%
MAP
$556.70
-16.2%
NH3
$675.47
-21.4%

 

Perspective --

The price slides that weighed on the market this week are largely due to localized declines in Indiana which sports a collective decline in DAP, MAP and K of $108.69. Michigan and Wisconsin played their parts as well, but most states were steady on the week.


 

 

 

Back to news


Comments

 
Spell Check

No comments have been posted to this News Article

Corn College TV Education Series

2014_Team_Shot_with_Logo

Get nearly 8 hours of educational video with Farm Journal's top agronomists. Produced in the field and neatly organized by topic, from spring prep to post-harvest. Order now!

Markets

Market Data provided by QTInfo.com
Brought to you by Beyer
Close