Fertilizer COP?

[bucket]

Has it cost more to make fertilizer in the last month?

I don't mind paying a little extra but these recent increases could be considered gouging?

There are no more acres in north america ...its a pretty constant number.

And I understand they can do it because they can....

But maybe just a little oversight wouldn't hurt.

After all, are we not all in this together??????

[dmlfarmer]

Has it cost more to make fertilizer in the last month?

I don't mind paying a little extra but these recent increases could be considered gouging?

There are no more acres in north america ...its a pretty constant number.

And I understand they can do it because they can....

But maybe just a little oversight wouldn't hurt.

After all, are we not all in this together??????

Cost of production has nothing to do with fertilizer pricing, or the pricing of anything else in a free and open market. NO complaints on here about $16.00 canola yet that is a bigger reason for the jump in fertilizer prices than COP. Low canola stocks have resulted in increased canola pricing bids to secure supply. By the same token fertilizer companies fore see an increased demand for fertilizer because of high commodity prices so have raised their prices. They know farmers will not cut back fertilizer rates with current pricing and in fact many will increase purchases. If they are wrong, they will be stuck with full warehouses come summer but they have been in the business long enough to know farmer sentiment when it comes to fertilizer purchases when commodity prices are rising. We do not need price regulation of fertilizer; or grains for that matter. What we do need is more competition and less consolidation both vertically and across the sectors.

[AlbertaFarmer5]

https://www.farmprogress.com/marketing/already-book-your-fertilizer-if-not-sit-down-you-read https://www.farmprogress.com/marketing/already-book-your-fertilizer-if-not-sit-down-you-read

A couple of thoughts.
My retailer mentioned that Urea prices in the US were TOO LOW for too long last year, so exporters couldn't compete and product wasn't coming in at the usual rate, drawing down supplies. High prices currently are working to fix that problem.
A lot comes from China, where natural gas prices are sky high this winter, affecting their output, and prices.
The tariffs on Phosphate imports is the biggest one. A question to all the folks who were campaigning for Biden, I thought he was supposed to be less protectionist, and remove all these import tariffs?

A minor detail in todays pricing, but Bryce mentions the decline in diesel fuel usage resulting in a big decline in the byproduct Sulfur for making S fertilizer.

But a cratering economy cut energy production around the world. U.S. sulfur output last year fell 16% from 2018 levels, sending stocks to the lowest level in decades.

Locally, we are surrounded by sour gas/sour oil, these are slowly being replaced by sweet, gas plants are converting to sweet, or closing altogether. This has been a huge source of S for fertilizer. I've been harping about this for years. When or if we transition from fossil fuels we don't have any immediate replacement for S fertilizer. This should serve as a wake up call.

It is never as simple as being just greedy retailers or producers taking advantage of farmers.

[bucket]

Come on man get in the ****ing game !

Farmers are price takers and canola supplies are tight so they got to pay for their own gain !

Fertilizer sheds are full and no Farmer is profiting from fertilizing in February !

This is gouging !

pure and simple gouging.

If this was Mid May ...maybe I could understand the gouging....but I find it hard to believe that a retail doesnt look at what they sold last year and make the call for the amount expected to be used out of their area....seems pretty stupid that an honest retail doesnt have a good number on their sales and plan accordingly....to maybe poach some customers?????

[AlbertaFarmer5]

pure and simple gouging.

If this was Mid May ...maybe I could understand the gouging....but I find it hard to believe that a retail doesnt look at what they sold last year and make the call for the amount expected to be used out of their area....seems pretty stupid that an honest retail doesnt have a good number on their sales and plan accordingly....to maybe poach some customers?????

Except some of those retailers can't even source Phosphate right now, regardless of price. Not price gouging when they don't have the product, or can't purchase it.

[workboots]

While mosaic corporation takes to the courts to barricade up foreign competition I would hope that any farmer supported group would be fighting back to keep that market free. Those foreign manufacturers might be subsidized but so are North American farmers. How do our domestic fertilizer manufacturers justify killing off this lifeline (affordable inputs) to put the cost pressure back on the low margin producers shoulders.


I do feel for the fertilizer manufacturer shareholders while they have been forced to cut back on the ration of caviar and French wine but it is the farmer that is the multiplayer and the distributer of wealth for much of the economy. Keep the doors open to affordable imported fertilizer and domestic manufacturers can seek support from government.

[bucket]

Except some of those retailers can't even source Phosphate right now, regardless of price. Not price gouging when they don't have the product, or can't purchase it.

True but they could have months ago....sort of sick of building bins to suit the graincos logistics and bins for the fertilizer logistics....

Fertilizer plants sheds should be full most of the time...

Mosaic at Belle Plaine one time shut down for maintenence with their sheds nearly empty....people were fired for it...and to be sure it never happened again.

[AlbertaFarmer5]

True but they could have months ago....sort of sick of building bins to suit the graincos logistics and bins for the fertilizer logistics....

Fertilizer plants sheds should be full most of the time...

Mosaic at Belle Plaine one time shut down for maintenence with their sheds nearly empty....people were fired for it...and to be sure it never happened again.

Except, it is my understanding that fertilizer retailers ( much like grain elevator companies), aren't in the speculation business. They aren't stocking up in anticipation of market moves, they are working on margins. Speculation took down some retailers last time around.

[furrowtickler]

What percentage of fertilizer is already bought ? Vast majority already pre bought ?
With canola at just over $12 next fall, i cant see very many more acres going in with feed barley over $5 and yellow peas over $9. Maybe a few acres but with these current fertilizer prices and canola around $12 next fall i am not so sure. $16 canola next fall would be a different story yes for sure.

[foragefarmer]

pure and simple gouging.

If this was Mid May ...maybe I could understand the gouging....but I find it hard to believe that a retail doesnt look at what they sold last year and make the call for the amount expected to be used out of their area....seems pretty stupid that an honest retail doesnt have a good number on their sales and plan accordingly....to maybe poach some customers?????

Of coarse there is some gouging, they see what commodity prices are doing, and know very well farmers will buy it. This should not come as a surprise to anybody on here.

My dealer told me back in November that there was a shortage of Phosphate in North America. He also told me that prices were going to increase in 2021 and to buy now. My dealer does look after regular costumers and tries to give the best information available out there when to make purchases.

If K is going up you knew very well N will follow in step, and the dealer gave me this information before $15.00 canola.

Gouging is happening everywhere, 2x4 almost $10.00.

Supply/Demand that's unfortunately how works, sometimes!

[bucket]

Its a shortage created by tariffs, and gouging not by any fact that the resource isn't there.

Its a little different than growing a crop that ends up being cut short by drought or heat stress....no such thing in the production of phosphorus ...the resource is known and so is the demand...

This is gouging and should be investigated ..although agriculture has little on the radar in Canada....my guess is there will be some noise in the states...

[TASFarms]

Funny how there is always an excuse for fertilizer price to go up.