Farmers looking to secure spring fertiliser supplies should not be pressurised into buying early and wait for price movements in the New Year, the NFU has advised.
“We’re told there are good supplies of Ammonium Nitrate available on the Continent, but we’re unlikely to see much of it imported until merchants have sold their 2008 stock,” farm inputs adviser Hannah Moule said.
“Merchants are bound to be trying to make the most of current high prices before the predicted falls next year. Our advice is: Don’t be pressurised by merchants into buying early – continue with your traditional buying patterns where possible.”
Ian Moseley, fertiliser manager for Wynnstay Arable, agreed prices were likely to fall, but was more cautious about whether to delay buying.
“Although the price of urea has collapsed, ammonium nitrate has stayed firm at £390/t for December.” But it was unknown whether the urea price was temporary, he said. “It’s dependent on the Asian market, which usually starts buying in January. And, of course, lines of credit are more difficult to access at the moment, adding a further difficulty.”
He warned that if too many purchases were delayed, there was a danger farmers could be left waiting for deliveries, because the traditional delivery period runs from November to the end of March. “If this suddenly gets pushed into February, there won’t be enough stock or sufficient transport facilities to meet demand.”
Growers should buy at least half of what they need now, he advised. “Otherwise you’re taking a big risk and may miss vital weather windows in the spring.”
Gleadell fertiliser trader Calum Findlay reckoned the arable sector was almost covered (80%), but 50-60% of the grassland business was still to take place.
GrowHow‘s marketing manager Ken Bowler said the company had recognised the sharp downturn in urea prices. “But we think this is a short-term market shift, arising from a lull in demand and the credit crunch. Fertiliser plants around the world have been closing, but ammonium nitrate prices haven’t reacted.”
He confirmed that spring fertiliser terms would be issued in the New Year, but refused to be drawn on the prices. “Our price list will take account of gas prices and other international factors.”
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