P&KToday: P&K In Lockstep

DAP, MAP and potash were all higher on the week.

• DAP $43.22 below year-ago pricing -- higher $3.16/st on the week to $446.11/st.
• MAP $49.05 below year-ago -- higher $3.18/st this week to $447.08/st.
• Potash $44.04 below year-ago -- higher $3.22/st this week to $325.59/st.

Potash was our upside leader in the P&K segment this week. Price strength was led by Kansas which firmed $7.86 as Minnesota, North Dakota and Nebraska all added about 3-and a half bucks. No state was unchanged on the week as Illinois fell 18 cents and Michigan softened 8 cents per short ton.

MAP was led higher by Kansas which added $13.98 as Minnesota firmed $8.72. Only Wisconsin was unchanged as Illinois softened $3.58 and Michigan fell 12 cents per short ton.

DAP firmed based on strength in Kansas to the tune of $15.31 along with a $7.69 price hike in Wisconsin. Only North Dakota was unchanged as Iowa softened $3.62 and Michigan fell 91 cents.

Potash, DAP and MAP all marched higher in near lockstep this week with all three firming roughly $3.20 per short ton. Potash prices may level off soon as demand in India is likely to fall in the

coming months as potash subsidies are on the chopping block. India is among the top world importers of potash along with China, and if end users see a significant price hike in retail potash, we expect demand to fall, and world stockpiles to exceed industry expectations. That would slow the rate of the supply rebalancing that the industry so desperately needs in order to support higher returns to manufacturers.

Phosphate production around the world is clipping along, and while we do not expect significant price strength in the near future, we suspect the bottom is in, and the time to book the remaining 50% of our spring phosphate needs is near. On an indexed basis, phosphate still holds a hefty premium to potash, but both are priced well below expected new-crop corn revenue, thanks to recent strength in December 2017 corn futures.

For now, we are 100% filled on spring potash and 50% filled on spring phosphate.

By the Pound -- The following is an updated table of P&K pricing by the pound as reported to your Inputs Monitor for the week ended February 17, 2017.

DAP is priced at 46 1/2 cents/lbP2O5; MAP at 41 3/4 cents/lbP2O5; Potash is at 27 1/2 cents/lbK2O.