July 7, Fertiliser Comment

By Ben Seamer

All eyes currently on the European Natural Gas Market, (the input for nitrogen production) firmed 43% last week
Predictions for European ammonia production = were lowered due to higher input costs
UREA prices appear to have found a floor with rising natural gas prices and pending seasonal demand a signal
The US corn/UREA ratio, a key affordability matric has fallen below its five year average and presents a buying opportunity for farmers
Some keys metrics for DAP, UREA and Potash are the ratio against corn. As fertiliser prices outpace crops
The DAP to corn price ratio is up 23%, UREA to corn ratio up 54% and POTASH to corn 57%
The UREA prices reflect the higher gas driven costs where POTASH prices point to limited supply and strong demand
US farmers could be tempted by ammonias relative value this spring, ammonia is currently at its steepest discount to UREA in nine years as a per unit basis
India and Brazil are the worlds largest UREA importers and their demand rises in the second half as crop planting picks up