Acreage Cutbacks Lower Fertilizer Prices
Planting intentions are off by more than 7 million acres, which pushes prices down.
Bryce Knorr
Published: Apr 5, 2009
With the final countdown to spring planting underway, fertilizer prices continue to move mostly lower at both the farmgate and wholesale level, underscoring farmers' plans to reduce acreage for 2009.
USDA put planting intentions for major crops down by more than 7 million acres this spring, because producers cut back due to low grain prices and high input costs. Fewer acres means less fertilizer demand.
Prices at the farmgate level continue to work lower, as farmers balk at costs that remain well above the wholesale level in many areas. Local suppliers who stocked up on inventory when prices peaked last fall resisted marking that product down, instead averaging their charges lower with new supplies bought at cheaper prices.
Perhaps the biggest change in the market recently is for potash. With the market dominated by only a handle of companies, potash prices stayed near record highs over the winter despite burgeoning supplies. Now, that situation finally appears to be cracking, at least at the wholesale level. Truckloads at terminals in the western Corn Belt are reportedly being done around $680 to $700, with the export market around $200 off its highs.
Check out the Weekly Fertilizer Report for more information.
Permalink: Click here
Tagged: fertilizer, usda, farmfutures, farmfutures.com, www.farmfutures
|