Price resistance is not an issue as nitrogen fertiliser sales move on apace

July, August and September allocations of domestic nitrogen have already been sold together with large tranches of the October to December current availability, about 30% of the expected whole for those months.


There are fears that the remaining 70% of October-December manufacture may attract yet another price rise when it comes on stream in October, this time around £20/t making AN £368/t by Christmas. Today the October price is £342/t.


However unpalatable these prices are, availability is clearly the big issue. At least in the UK it is possible to see some structure in the nitrogen market up until Christmas. In the rest of Europe, prices are still issued monthly.


After Christmas, who knows? Manufacturers are worried about widely publicised winter gas costs, but concede that we must be near to the top of the price cycle curve now.


Potassium costs escalate
There is no such confidence when it comes to potassium. Although the cost per acre is lower than that for nitrogen, the retail farm value per tonne currently exceeds £550. On mainland Europe the wholesale price is currently €600/t bulk, but no sooner than costs appear on these pages, they seem to escalate. Global prices of $1050/t .have been reported.


Bigger users of Potash, for example, India, are showing no price resistance and any such resistance by the UK has no effect whatsoever on global prices. Muriate of potash will exceed £600/t in Britain by the spring.


Fortunately, greater profit by the potash industry does allow for further investment, so reinvestment in both green and brownfield sites is taking place, notably in Canada and Russia. However, the time scale for greenfield development is 5-7 years, with three for brownfield sites, so shortages and high prices are forecast for at least the medium term.


Potash supplies finely balanced
With an estimated 51mt of production in 2006 against sales of 50.7mt worldwide, potash supplies are finely balanced. Current planned investment could cope with a further 3% increase in demand, but some forecasts place global demand as high as 63.9mt by 2111.


Potash is traded in dollars, so currency fluctuation also plays its part. And with no global stocks to hand, the future for potash pricing looks grim for the consumer. The one saving grace in the potash saga is that global reserves, underground, are high. The long term supply is still assured.


Phosphate reserves compromised
No such assurance is available for the phosphate industry whose reserves are severely compromised. Politicians with any interest in safeguarding food supplies for future generations should divorce themselves from mere five year planning and seriously look ahead.


The current, practical, outcome of all of this is that UK farmers find it harder to obtain conventional higher PK compound fertilisers, such as 20.10.10, and, when they are available, products such as 16.16.16 are now £565 per tonne!


Soil analysis, once a Cinderella service, must surely now be in enormous demand as fertiliser agronomy, too often performed on the back of a fag packet, now come of age.


Great Britain





















Straight


Domestic N
(34.5%N) SP5


Imported AN 
eg Lithuanian


Imported urea


Liquid UAN
37kg N/100litre


 (28.8 %N/t)


 


 


£342-345-348


Oct-Nov-Dec


Increasing volume at or around domestic price


£425 +


no prices


 


 


 


 













TSP (47%P2O5)


£640+ tight availability


 


Muriate of Potash (60%K2O)


£550 rapid change


 


 













































































Compound


N.P.K


Complex


Blended


 


 


 


25.5.5


£385


August


Broadly similar


 


 


 


15.15.20


£ not available


 14.14.20


£565


 


 


 


20.10.10 / 27.5.5


£425 if offered


Broadly similar


 


 


 


17.17.17


Outpriced £500+


None in production


16.16.16


£565


 


 


 


Aftercuts (NK)


 


£390 Aug


 


 


 


23.4.13.7 Sulphur


 £395


 


 


 


 


 


 


 


 


 


 


Autumn grades (PK)


 


£500+ when offered.


 


 


 


 


 


 


 


 


 


 








Trace elements


Copper, zinc, selenium,
cobalt Iodine and sodium

£11.80/acre pack






Ireland (All prices volatile)


































 


Urea


CAN


25.0.13
aftercut*


27.0.6


27.6.6
complex**


Northern
Ireland


No market


Highly volatile spot prices


Highly volatile spot prices


Highly volatile spot prices


No longer used


Phosphate regulations


Republic
of Ireland


 


Highly volatile spot prices


Highly volatile spot prices


 


No Market.





†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.
*Known as 24.2½.10 blend in the Republic of Ireland
**Known as 27.2½.5 in ROI







Note All illustrated prices are based upon 24 tonne loads for immediate payment. Prices for smaller loads and those with credit terms will vary considerably.


Source: Bridgewater