Urea Prices Surge for Second Week Straight

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by Russ Quinn, DTN Staff Reporter

OMAHA (DTN) — For the second week in a row, urea prices climbed significantly, according to retail fertilizer prices tracked by DTN for the second week of March 2012. Simple demand and supply is at work with the higher urea prices, retailers said.

Urea was 13{962fe9be9a8a5c386944bfa41f48d98b010325707b70b1fa6182bcabd27c5d7f} higher compared to a month earlier and had an average price of $621 per ton.

The remaining seven fertilizers slipped lower compared to a month ago; however, these declines were again fairly minute. DAP had an average price of $644/ton, MAP $696/ton, potash $655/ton, 10-34-0 $799/ton, anhydrous $767/ton, UAN28 $376/ton and UAN32 $421/ton.

The close below $700/ton for 10-34-0 was a first for the starter fertilizer since the second week of September 2011.

On a price per pound of nitrogen basis, the average urea price was at $0.68/lb.N, anhydrous $0.47/lb.N, UAN28 $0.67/lb.N and UAN32 $0.66/lb.N.

The calm in the fertilizer market may have lulled everyone into thinking the steadiness in prices might continue through the spring, but this did not happen, said Matt Christopherson, agronomy manager for North Central Farm Elevator located in Ipswich, S.D.

During this lull, farmers didn’t order much fertilizer so retailers didn’t ship much fertilizer to their locations. Then when urea started being used in some Southern Plains/southern Corn Belt areas on wheat and pastures the price moved higher because many retailers’ supplies were low, he said.

“This is all about supply and demand, Christopherson told DTN. “The fact that winter has been mild and dry means areas to the south have already sucked up some of the urea supply. That has pushed everything ahead nearly a month, which is why we have seen some higher urea prices now.”


On the plus side, Christopherson said this situation might move some farmers who have not ordered all their fertilizer needs yet to, at the very least, plan with their fertilizer retailers how much of each fertilizer they will need. This would allow retailers to know generally how much of each type of fertilizer they need to order, he said.

Three of the eight major fertilizers are still showing double-digit increases in price compared to one year earlier. Leading the way higher is urea. The nitrogen fertilizer is 26{962fe9be9a8a5c386944bfa41f48d98b010325707b70b1fa6182bcabd27c5d7f} higher compared to last year while potash is now 11{962fe9be9a8a5c386944bfa41f48d98b010325707b70b1fa6182bcabd27c5d7f} higher and 10-34-0 is 10{962fe9be9a8a5c386944bfa41f48d98b010325707b70b1fa6182bcabd27c5d7f} more expensive compared to the second week of March 2011.

Three fertilizers have seen just slight price increases compared to a year earlier. Anhydrous has now climbed 4{962fe9be9a8a5c386944bfa41f48d98b010325707b70b1fa6182bcabd27c5d7f} while UAN32 is up 3{962fe9be9a8a5c386944bfa41f48d98b010325707b70b1fa6182bcabd27c5d7f} and UAN28 is 2{962fe9be9a8a5c386944bfa41f48d98b010325707b70b1fa6182bcabd27c5d7f} more expensive than last year.

Two fertilizers are now actually lower compared to one year ago. DAP is now 5{962fe9be9a8a5c386944bfa41f48d98b010325707b70b1fa6182bcabd27c5d7f} lower while MAP has decreased 1{962fe9be9a8a5c386944bfa41f48d98b010325707b70b1fa6182bcabd27c5d7f} in price compared to a year earlier.

DTN collects roughly 1,200 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 2012 DTN/The Progressive Farmer, A Telvent Brand. All rights reserved.

Posted with DTN Permission by Haylie Shipp

 

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