Crop input prices sharply up, with frequent changes

Farmers are finding their bank accounts are a lot lighter after ordering fertilizer for this spring.  Fertilizer and seed dealer Tony Grapsas from Jay-Mar in Plover, Wisconsin tells Brownfield the stunning part of this winter is the acceleration of price changes, especially for nitrogen. “It is going up, up, up, with price changes from the manufacturer or distributors happening as often as twice a day. I’ve never seen that pace of price change.”

Grapsas says prices have been stagnant over the last three or four years, but now, he’s frequently had suppliers change prices and availabilities. “The only steady supply has been potash. Liquid and dry phosphates are increasing in price and showing a shortage of availability. Nitrogen whether it’s urea or solutions continues to go up, up, up.”

Grapsas says he believes these high prices are not sustainable. “This is a bubble that’s going to burst. It’s not going to slowly deflate and gently make it’s way down to the ground. It’s going to plunge like a rock, but who knows when that’s going to take place.”

Grapsas says the strength in grain prices, fewer imports are affecting input prices but also a bit of panic buying and market creation involved to keep prices higher. “I think some of the producers have product but they don’t want to sell as many tons as they could because they see the market appreciating, and like good capitalists, you want to maximize your profit, don’t you?”

When comparing prices from February 10th to last April, Grapsas told Brownfield the changes are shocking. He says potash was $342 dollars a ton then compared to $386 a ton now. DAP or diammonium phosphate was $398 a ton last April and is $506 a ton now. Ammonium nitrate, which is a preferred nitrogen source for his local potato growers, is selling for $518 a ton compared to $331 a ton last April.

His advice is to work with suppliers now and try to lock in prices and quantities, especially for nitrogen as he doesn’t expect nitrogen prices to fall much before side-dressing time.

Tony Grapsas discusses input prices with Brownfield’s Larry Lee 2/10/21

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