By Roger Chesher

“CRUNCH” time for nitrogen buyers is now, because the big jump in price is due next month when the majors expect to move up 6.00/tonne against the 2.00 per month so far.

With only an estimated 50-60% so far delivered on farm, there are still many farmers who either are prepared to pay the extra, or who believe they will be able to buy cheaply in the spring.

So who is right?

First, there is currently no shortage of imports.

Whereas in July and August, imports were hard to get, they were entering the UK in quantity in the third quarter to the extent that an estimated 280,000 tonnes of the required 500-600,000 tonnes of material has now been imported.

But, with so little having been delivered to farm, much of the imports are sitting in warehouses preventing the balance from arriving.

While clearly there will be no supply problems in January and February, there is still at least a 220,000t shortfall to import which now presents logistical difficulties.

In fact the whole industry is once more citing logistical difficulties as fewer hauliers find it worthwhile investing in the training required to legally carry fertiliser.

This story has been heard so often with little practical affect that farmers accuse the industry of crying wolf, but a hard look at the true situation would indicate that the wolf really could bite hard very soon.

Additionally, there are increasing rumours of an embargo on Russian exports, as happened in the last three years, to ensure supplies for their own farmers.

We should also remember the strength of the Pound and the fact that higher fertiliser prices throughout Europe are a more attractive market.

The net result of all this is that we will almost certainly witness a balanced market, which means the new price structure should stick and the majors stand a chance of a modest profit this year.

If the price does fall, the industry will lose its final shred of credibility and one doubts if farmers will ever consider buying early again.

Meanwhile, compounds are moving steadily on o grassland farms as the big N standoff continues.

CURRENT PRICES

New-season nitrogen (SP5) 34.5% Anticipated spring price nitrogen Imported urea (if available) Imported AN (new season) Blended 20.10.10 and 25.0.16 Blended 25.5.5 Liquid nitrogen, 37kg/100l or 29.6% N/t
December 124 January 130
February 132
March 134
Granular 140-144
Prilled 130
114 (Quality)
118-120 (March)
118-120 115-118 No market
NPK December, pay cash January, pay cash April, pay cash (forecast)
Complex 25.5.5 124 126 134
27N30S 126 132
20.10.10/29.5.5 127 129 137
17.17.17 144 146 152
After-cut NK cash 0.24.24 TSP (47% P2O5) Muriate of Potash (60% K2O)
118 106-115 130 122

 

IRELAND

  Imported urea

CAN

24.6.12

0.16.36

Complex compounds
27.6.6

Northern Ireland Not available 120-125 No prices No market No prices
 

CAN

24.21/2.10

Urea, imported

27.21/2.5

Republic of Ireland* 145 180 Not available 177

*Note in the Republic of Ireland nutrients are expressed as elements not oxides. Analyses will not be directly comparable with those used in the UK.

*Prices in the Republic are IR

  • IR1=UK78.13p; US$1=UK69.69 p on 06 December

     

    Note All illustrated prices are based on 20-tonne loads for immediate payment. Prices for smaller loads and those with credit terms will vary considerably.

    Source: Bridgewater Partnership