DTN Retail Fertilizer Trends

All Fertilizer Prices Lower Again

Russ Quinn
By  Russ Quinn , DTN Staff Reporter
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Urea slipped through the important psychological $400-per-ton mark, its lowest level in more than five years. (DTN chart)

OMAHA (DTN) -- National retail fertilizer prices continued to drift lower the third week of December 2015, according to dealers tracked by DTN. That's a move that could offer modest breaks for corn budgets in 2016.

All eight of the major fertilizers edged lower compared to a month earlier, but none were down significantly. DAP had an average price of $532 per ton, MAP $544/ton, potash $410/ton, urea $392/ton, 10-34-0 $571/ton, anhydrous $612/ton, UAN28 $279/ton and UAN32 $331/ton.

Urea fell through the $400-per-ton level in recent weeks. This is the first time the fertilizer's price has been below this level since the first week of September 2010 when the price was at $392 per ton.

On a price per pound of nitrogen basis, the average urea price was at $0.43/lb.N, anhydrous $0.38/lb.N, UAN28 $0.50/lb.N and UAN32 $0.52/lb.N.

In a recent farmdoc Daily report from the University of Illinois titled "Current Fertilizer Prices and Projected 2016 Fertilizer Costs," author Gary Schnitkey examined where retail fertilizer prices are currently and where prices could be in 2016. As one might expect, fertilizer prices are lower than in recent years.

Schnitkey reports the average price of anhydrous ammonia in Illinois right now is $650 per ton, slightly higher than DTN's national survey. This 2015 December price is $78 per ton lower than the $728 per ton seen a year ago.

"The $650 price is the lowest price since 2008 when anhydrous ammonia was selling for $478 per ton," Schnitkey said.

The same general trend would be true for both DAP and potash as well, he wrote.

The December 2015 implied fertilizer price results in fertilizer costs of $133 per acre, using 215 pounds of anhydrous ammonia per acre. This cost is below the 2014 cost of $145 per acre. The December 2015 price is also the lowest cost in any year going back to December 2009 when the implied fertilizer cost was $109 per acre.

Implied fertilizer costs using December prices are not a perfect indicator of fertilizer costs the next year, Schnitkey points out. December is but one month out of the year while fertilizer is purchased in many months. Despite these differences, December prices are useful predictors of fertilizer costs in the following year, he said.

"Implied fertilizer costs in December 2015 are lower than in all years since 2009, suggesting that fertilizer costs in 2016 could be lower than in recent years," he wrote. "Current projections put corn fertilizer costs in 2016 about $10 per acre lower than in 2015. If fertilizer prices continue to decrease, this cost decrease could become larger."

The entire report can be found at http://farmdocdaily.illinois.edu/….

With retail fertilizer moving lower in recent months, only one fertilizer is now higher compared to a year earlier, according to DTN's survey. 10-34-0 is 1% higher from last year.

The remaining seven nutrients are now lower compared to retail prices from a year ago. DAP is now 6% lower, MAP is 8% less expensive and UAN32 is 9% lower. Both anhydrous and UAN28 are now 13% lower while both potash and urea are 15% less expensive than a year previous.

DTN collects roughly 1,700 retail fertilizer bids from 310 retailer locations weekly. Not all fertilizer prices change each week. Prices are subject to change at any time.

DTN Pro Grains subscribers can find current retail fertilizer price in the DTN Fertilizer Index on the Fertilizer page under Farm Business.

Retail fertilizer charts dating back to November 2008 are available in the DTN fertilizer segment. The charts included cost of N/lb., DAP, MAP, potash, urea, 10-34-0, anhydrous, UAN28 and UAN32.

DTN's average of retail fertilizer prices from a month earlier ($ per ton):

DRY
Date Range DAP MAP POTASH UREA
Dec 15-19 2014 565 592 483 461
Jan 12-16 2015 566 594 486 465
Feb 9-13 2015 569 597 488 473
Mar 9-13 2015 570 597 489 471
Apr 6-Apr 10 2015 570 598 491 461
May 4-8 2015 570 598 491 457
June 1-5 2015 570 598 491 461
June 29-July 3 2015 570 596 490 469
July 27-31 2015 569 594 487 469
Aug 24-28 2015 567 586 476 447
Sept 21-25 2015 562 575 454 428
Oct 19-23 2015 547 562 435 413
Nov 16-20 2015 545 559 424 403
Dec 14-18 2015 532 544 410 392
LIQUID
Date Range 10-34-0 ANHYD UAN28 UAN32
Dec 15-19 2014 572 705 322 362
Jan 12-16 2015 582 710 325 364
Feb 9-13 2015 589 707 330 370
Mar 9-13 2015 626 706 331 371
Apr 6-Apr 10 2015 648 709 333 370
May 4-8 2015 653 711 331 371
June 1-5 2015 650 710 331 371
June 29-July 3 2015 642 705 330 369
July 27-31 2015 636 689 324 354
Aug 24-28 2015 609 667 309 350
Sept 21-25 2015 589 646 297 343
Oct 19-23 2015 582 637 291 334
Nov 16-20 2015 579 629 287 332
Dec 14-18 2015 571 612 279 331

Russ Quinn can be reached at russ.quinn@dtn.com

(MZT/AG)

Russ Quinn