In an Article from Ag Web by Tyne Morgan, Josh Linville, vice president of Fertilizer for StoneX Financial Inc., says the current fertilizer and corn price ratio is at historic levels, with potash the worst in history, UAN the second worst in history, and urea ranking as the third worst.
If falling corn prices weren’t bad enough, fertilizer prices surged higher to finish June. With the corn-to-fertilizer price ratio now some of the worst in history, it’s likely farmers will be spending more on fertilizer this fall.
Josh Linville, vice president of fertilizer for StoneX Financial Inc., says the current fertilizer and corn price ratio is at historic levels:
- Urea: third worst in history
- UAN: second worst in history
- Phosphate: worst in history
“When we look at the price of urea versus grain prices, something we look at quite a bit, especially the corn price, values are incredibly high,” Linville says. “This is what the farmers are struggling with. They’re saying, my corn price and my grain price continues to fall almost daily, and yet my fertilizer prices are insanely too high.”
Why Have Fertilizer Prices Surged?
There’s a number of reasons, but they are all global. The latest reason was the U.S. bombing Iranian nuclear sites and talk of closing the Strait of Hormuz. Considering Iran is the third-largest producer of urea, the news sent urea prices higher.
Once a ceasefire was announced, urea prices did see a quick drop, which was welcome news to farmers. But just this week, those prices are trending higher again.
“We saw our barge values in the Gulf rise from, they had dropped down to about $345 per ton, and they rallied about $100 a ton. Fortunately, ceasefire was found very, very quickly there, after the attacks and things had calmed down, prices started to fall, and we went from a level of $455 per ton back down to $385,” Linville says. “Now all of a sudden India is stepping in with a major purchase, Brazil demand is around the corner, and urea prices have firmed yet this week.”
