Wednesday, February 21, 2024

Fertilizer Prices Rise, Railroads Commit to Haul


by Russ Quinn, DTN Staff Reporter

OMAHA (DTN) — Retail fertilizer prices tracked by DTN for the third week of April 2014 continue to march higher. This marks the ninth consecutive week all retail fertilizers' prices advanced and may be a sign of delivery bottlenecks in some parts of the country.

Anhydrous alone jumped 11{0a3336b3da8cf935de4f3eb78fe29508c4b8b5ebd27d01af2d815614325d533e} compared to a month earlier in DTN's latest survey. The nitrogen fertilizer had a national average retail price of $685 per ton.


The phosphorus fertilizers were also higher once again. MAP prices were up 10{0a3336b3da8cf935de4f3eb78fe29508c4b8b5ebd27d01af2d815614325d533e} compared to a month earlier while DAP was up 8{0a3336b3da8cf935de4f3eb78fe29508c4b8b5ebd27d01af2d815614325d533e}. MAP had an average price of $617/ton and DAP was at $586/ton.

Urea was also higher compared to a month earlier. The nitrogen fertilizer gained 6{0a3336b3da8cf935de4f3eb78fe29508c4b8b5ebd27d01af2d815614325d533e} compared to a month ago and had an average price of $552/ton.

The remaining four fertilizers' prices were higher, but the shift to the high side was fairly insignificant. Potash had an average price of $475/ton, 10-34-0 $525/ton, UAN28 $354/ton and UAN32 $401/ton.

UAN32 was above the $400 per ton level for the first time since the second week of August 2013. That week the UAN32 price was $412/ton

On a price per pound of nitrogen basis, the average urea price was at $0.60/lb.N, anhydrous $0.42/lb.N, UAN28 $0.63/lb.N and UAN32 $0.63/lb.N.

In recent weeks, DTN has reported Northern Plains farmers' and fertilizer retailers' frustrations with railroad delays shipping both fertilizer and grains. This situation was occurring, they speculated, because of the increased shipments of crude oil from the Bakken region of North Dakota.

Last week both the Canadian Pacific (CP) Railway and the Burlington Northern Santa Fe (BNSF) Railway Company told a federal oversight board that they are committed to hauling fertilizer in the Northern Plains, according to AP.

The Surface Transportation Board ordered both railroads to report their plans by April 18 to ensure timely delivery of fertilizer. Recent issues with railroad service problems spurred the federal board to hold a hearing. Farmers and representatives for agriculture producers had testified delays could occur in planting this spring, AP reported.

Both railroads blamed “extreme winter weather” that caused rail traffic congestion in Chicago. This situation should ease soon and “will result in improved transit times for all shipments of fertilizer,” according to Keith Creel, Canadian Pacific Railway's president and chief operating officer.

BNSF, the largest shipper in the Northern Plains, said it would add about 50 trains mostly in the Dakotas, Minnesota and Montana in the next six weeks solely for transporting fertilizer, according to AP.

The Fertilizer Institute told the board in written testimony that timely fertilizer shipments have never been an issue for at least a decade until this year. The group told the board that “it's genuinely concerned that the fertilizer industry will not be able to deliver the fertilizer needed for crop production, particularly in major agricultural areas served by BNSF and CP,” AP reported.

The National Grain and Feed Association also voiced their concerns to the board. The group said disruptions to grain shipments by rail have been “widespread and severe,” and have occurred “long before the onset of harsh winter weather,” according to AP.

While fertilizer prices have moved higher in recent months, all remain less expensive than year-ago levels.

Urea has slipped 4{0a3336b3da8cf935de4f3eb78fe29508c4b8b5ebd27d01af2d815614325d533e}, DAP is 5{0a3336b3da8cf935de4f3eb78fe29508c4b8b5ebd27d01af2d815614325d533e} lower and MAP 6{0a3336b3da8cf935de4f3eb78fe29508c4b8b5ebd27d01af2d815614325d533e} less expensive. UAN32 is now 11{0a3336b3da8cf935de4f3eb78fe29508c4b8b5ebd27d01af2d815614325d533e} lower while UAN28 is 12{0a3336b3da8cf935de4f3eb78fe29508c4b8b5ebd27d01af2d815614325d533e} less expensive and 10-34-0 is down 14{0a3336b3da8cf935de4f3eb78fe29508c4b8b5ebd27d01af2d815614325d533e}. Potash is 19{0a3336b3da8cf935de4f3eb78fe29508c4b8b5ebd27d01af2d815614325d533e} less expensive and anhydrous is 20{0a3336b3da8cf935de4f3eb78fe29508c4b8b5ebd27d01af2d815614325d533e} lower than a year earlier.

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.


© Copyright 2014 DTN/The Progressive Farmer. All rights reserved.

Posted with DTN Permission by Haylie Shipp



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