Will Farmers Benefit from Lower Fertilizer Prices Again in 2017?

fert-spreader

by David A. Widmar

Lower fertilizer prices have been a welcome relief for producers facing falling commodity prices and farm incomes. Fertilizer prices offered big cost relief in 2016 and were the largest source of total cost reductions. These fertilizer price reductions came even with strong quantities of fertilizer demanded from a large corn crop; U.S. corn acreage was up 7% from 2015 and was the third highest acreage since 1944. Given lower fertilizer prices but strong usage from increased corn acres, this week’s post takes a look the prospects of even lower fertilizer prices again in 2017. Continue reading

Fertilizer Leads Variable Expenses Lower

truck

by David A. Widmar

A few weeks ago we evaluated fixed expenses to see if adjustments lower had occurred. Changes have been slow, but have started to emerge. Another second component of production costs are variable expenses. These are the expenses producers typically monitor very closely; fuel, fertilizer, and seed. This week we take a look at the USDA’s cost of production data and the Purdue crop budgets to evaluate where source of lower variable expense have occurred. Continue reading

A Look at Cutting Fertilizer Rates

Fert Spreader

by David A. Widmar

For most producers, lower input prices are the easiest way to reduce their cost of production. In past posts we’ve evaluated seed prices and fertilizer prices. While recent data indicates lower fertilizer prices are possible in 2016, farmers will likely place pressure on their retail partners to get fertilizer expense even lower.

Another option for producers to lower their fertilizer expense is by reducing application rates, especially for soils with banked phosphorous and potassium. This week’s post takes a looks at the data to see if this strategy has been used in the past. Specifically, nitrogen, phosphorous, and potassium application rates for corn have been evaluated.

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