July 16, 2012 at 7:34 am
The Good
I will start with the Good but please keep reading because the Ugly may save you money next year. The cost of Urea is down along with DAP and Potassium Sulfate from last year at this time.
| Mid Corn Belt, Great Lakes | July 2nd, 2012 | July 2nd, 2011 |
|---|---|---|
| UREA | $495 – $530 | $525 – $540 |
| DAP | $540 – $575 | $620 – $640 |
| POTASSIUM SULFATE | $695 – $705 | $760 – $770 |
The Bad
Inputs for this year’s crop have all but stopped with the high temperatures and lack of rain. When this happens prices come down because of lack of demand. The recent surges in heat and lack of rain the last few weeks have taken its toll on corn that is in the peek of its pollination cycle. The record planting of 96 million acres of corn is estimated now to produce about 13.52 billion acres down from 14.79. This number will leave us less surplus going into 2013 than we had coming into 2012 holding or raising corn prices.
The Ugly
What does all this mean? Well most experts believe it means inputs such as fertilizers will remain bullish for fall 2012 and into summer 2013. Last fall we saw prices start going up in August and did not start coming down until June 2012. The people who took a position last fall reaped the rewards this year. Fertilizer is coming down as blenders are able to work through inventories and buy cheaper inputs and many are close to the bottom of the current market. We are in a cycle of supply and demand. When farmers start buying again for next year’s crop pricing will start to go up. Get out your Crystal ball and I think you will see that from now until this fall may be your best time to buy.
Vic Garcia
Vice President
