buying fert now, not!

[charliep]

Will note the FAO (Food and Agriculture Organization) fertilizer outlook:

http://www.fao.org/docrep/010/ai466e/ai466e11.htmelow.

also a longer term analysis done this spring.

http://www.fertilizer.org/IFA/publicat/PDF/2008_vienna_ifa_summary.pdf

[SASKFARMER3]

Also Charlie the latest out Is the Fert industry the New Dot Comm. Would be interesting if that happened.
Watch Gulf for problems with Hurricanes if they do hit if full force it will stay up or higher if they don't Ill go with The other.
YES FERTILIZER PRICES ARE CRIMINAL and if you don't think they are your not in the real world.

[Jay-mo]

It's pretty hard to take but when I paid .70/liter for Alpine starter this spring and now its $1.75/liter for August....
It makes the recent rise in fuel prices look reasonable.

[charliep]

SK3

Just curious if you read the documents?

[dave4441]

I am in the real world. I am realistic. Is 45 cent red lentils criminal when cost to produce is 10 or 15 cents? I do not beleive so, just the market. Am i ripping people off if I sell at that level? Should buyers question if I am taking my kids to Disneyland after dropping off a load of mustard? Durum at $25/bu, 3-5X the long term value, criminal, do not think so, but happy to sell it there (i realize I could not access that price, but that is another thread) If crop prices stay at levels seen over the last 12 months we will not have to worry about fertilizer costs as everything will come up due to massive net profits/ac. I say this with the realization that some have some crop production problems and this will put some into a tough position, but it is still reality.

[charliep]

Agree dave4441

The focus of the fao publication is the years of increasing grain/oilseed consumption and the world's need to catch up via production increases. Increased production will come via increased input use short term and more efficient use down the road. The growth in fertilizer use is not a North American phenomena but rather occurring in Latin America and Asia. In some sense, high fertilizer prices go hand in hand with high crop prices. I note the second study goes on to highlight that current profitability in fertilizer will stimulate more production. Nothing is said about who is making money and whether fair.

The conversation here is a good one in terms of a decisions people are making today - everyone will read and decide what to do based on their own assessment of risk/profitability. The next question is what to do in a higher cost world. Also a good discussion in terms of what to spend money on but also how to manage risk after a farmer has spent the money.

[cottonpicken]

I think this will be the first year ever that it will pay to wait.

Markets tend to whipsaw the crowd.

I am talking nitrogen only

[mcfarms]

But nitrogen only cp, I'd be thinking hard on getting a percentage of coverage on potash , sulfur and phosphate. Read this from todays news wire articles . Remember that for a lot of the world the US dollar is on sale thus these inputs increases have been muted somewhat.



Spot potash prices for overseas sales were unchanged in June at an
average of US$525 per tonne, but have jumped to US$762.50 in July. Following
the lead of Belarussian Potash Company (BPC), Canpotex has now sold
significant spot volumes for shipment to Asian markets in the fourth quarter
at US$1,000 cfr (delivered, standard grade) and has advised customers that all
new spot sales over the balance of 2008 to Southeast Asia, Brazil and Latin
America will be at the US$1,000 cfr level (US$1,025 for granular). This will
lift prices to about US$900 at the Port of Vancouver in the fourth quarter, up
211 per cent year-over-year. To handle increased exports from mine expansion
in Saskatchewan, Canpotex will almost double its West Coast port capacity by
2012, with a new terminal announced for Ridley Island and expansion at Neptune
Bulk Terminals in Vancouver.




I can only really recall a couple years where spring was lower than the previous July to September and that was precipitated by horribly low grain prices and previous year dryness causing higher than normal carryovers of nutrients. Genrally decent crops around the world and the fact that the grain prices though lower than the winter/spring highs don't point to those conditions this year. Nitrogen may be a bit of the wild card but that isn't to say it's going to be way down from current levels but we may see less corn south of us than I thought we would 2 months ago.

[SASKFARMER3]

Jul 03, 08 545 683 462 1727

Jul 10, 08 545 727 460 1727

Jul 17, 08 625 758 464 1727

Jul 24, 08 650 808 519 1727


Again phos has held constant and not changed since spring, nitrogen and other three are up 100.

Yes its all based on how much you want to risk your farm. But if your Fert bill is not covered by Crop insurance IE. Sask crop insurance coverage is so low and its not Alberta or Manitoba. then I think one has to reevaluate what the heck is happening.
Yes Charley I read the article, And yes this is good for discussion farmers will have to asses their situation and go from their. We are looking at all different scenarios. But buying now vs later is 100000 -200000 thousand dollar chance Ill take compared to 1.1 Million Crop insurance coverage to 3.9 million plus pay day based on FROST that could hit.
If the crop comes in Ill need income tax deduction if it freezes Ill buy from who ever.