Price Comparison -- NPK From Thanksgiving 2012 to Today

April 16, 2013 06:37 AM

Across the Midwest, Thanksgiving is roughly the time when farmers would like have fieldwork complete. It marks the official start of winter on the farm, and with deer season right after, if you are like me, you would rather be thinking about deer slugs and readying the ol' 870 for a visit to the woods than worrying about fertilizer.

The table below compares pricing from Thanksgiving 2012 to pricing from the present day. Most growers have long since made nutrient purchases for the spring '13 application, and on a comparative basis, now is not a bad time to think about forward booking your fall needs. This comparison shows as many declines as gains and if you expect last year's pricing to be any indication of things to come, this data is worth noting. The trend has been for nutrient to move generally higher since early 2009 when a price correction sent NPK prices tumbling. But amid that correction, your NPK fantasy league favors Urea, DAP and Potash.

Thanksgiving 2012
April 2013
Farm Diesel


Nitrogen --

Nitrogen has moved mostly higher since Thanksgiving with the exception of urea. NH3 is currently $14.44/ton higher at $880.69 -- that's still the cheapest form of N by pound at $.054/lbN. UAN solutions have perked up over the last month as contracts are in place for late season sidedress.

UAN28 has really poured it on adding $18.60/ton since thanksgiving, currently at $0.70/lbN. UAN32 moved mildly higher over the report period adding $6.58/ton, now at $0.68/lbN.

Urea has found some fresh demand this year as world pricing favors this dry alternative to NH3, and while more expensive by the pound at $0.62/lbN, urea offers a more user friendly approach to nitrogen application. Prices hit their peak in 2008 and quickly faded, but urea has been steadily moving higher since the falloff in early 2009 and is currently tracing a line roughly midway between that peak and valley.

Phosphate --

Both DAP and MAP have eased since Thanksgiving 2012 and while nitrogen as a whole has been more aggressive toward 2008's high, P products delivered to Tampa are currently on a downward slope. DAP is $21.92 below Thanksgiving's price and falling at $635.91/ton. Ammonia and phosphate rock are moving lower in wholesale markets, and given the long-term offtake deals the U.S. has with Trinidad and Morocco, this downward trend may last through the summer. MAP is down $14.82/ton from Thanksgiving at $654.43.

Potash --

Thanksgiving 2012 had Canpotex waiting for the phone to ring, but China and India delayed purchases until the price fell to $400.00/tonne FOB. That came in December when China inked a deal for 1 million tonnes of potash, but in the meantime, PotashCorp curtailed production and laid workers off through the first of the year as potash inventories were too large to support anymore production. The layoffs have ended, but the inventory remains.

Retail potash is now $25.29/ton less than it was at Thanksgiving. Declines in P&K generally indicate the market is looking for some demand as nitrogen pricing may have growers cutting back on P&K applications this spring. This trend would help build the DAP/MAP supply and should support moderating pricing ahead.




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