Survive fertilizer price pain
Are current healthy profit levels pushing it? Or, are farmers trying to stay ahead of surging prices? No matter what the reason, it sounds like there are more early-bird sales and prepayment for fertilizer for the 2012 crop.
The morning after an overnight rainfall earlier this week, farmers weren't able to do much of anything in the field around Humboldt, Iowa. Whether it was their inability to get fieldwork done or the heat of rising fertilizer prices, it made for a busy morning for Pro Cooperative agronomist Matt Blanchard in Humboldt.
"Rainy morning here today, and I've had no less than three people contact me this morning about buying fertilizer for the 2012 crop," Blanchard said this week. "Shortly after I had booked 70 tons of UAN for a customer, our price went up $45/ton."
Agriculture.com Farm Business Talk member kraft-t thinks there are several possible reasons behind the surge in prepay orders like the one Blanchard's facing. Current grain prices have profits healthy and some may be nailing down what's likely the most volatile input, price-wise.
"It sounds to me like people are considering selling 2012 crops and want to get some assurance on 2012 crop inputs," kraft-t says. "It may be folks that already have too much crop income and want to offset it with current purchases on next year's inputs; or merely price assurance on future needs."
What if you're having trouble justifying rising fertilizer prices? Then, get specific. Farm Business Talk member nwobcw said recently he was staring down the barrel of a three-figure increase in the price for potash he wanted to apply on a 40-acre soybean field. And, he was looking for a way around the steep increase.
"I would recommend that anyone in your position that you soil test before spending any money on fertilizer," recommends Farm Business Talk member and certified crop adviser (CCA) rfmgis.
"I'd be inclined to skip the fertilizer now and do a decent job of soil sampling in the fall, then decide for the fall/spring what you want to do," adds Farm Business Talk member Jim Meade / Iowa City.