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Rising fertilizer prices explained
Dr. Victor Martin

As of Oct. 5 our area is again essentially unchanged. Moderate to severe drought was continuing to creep further into the northwest corner of the state and along the Oklahoma border. Fall crop harvest is underway again after the recent rains in most areas, as is wheat planting in most spots. Wheat planted before the rains is coming up and looking good; however, it pays to continue to look out for armyworms. The end of this past week was unseasonably warm for October and that doesn’t help the soil moisture situation, especially combined with the wind. The promise of rainfall this weekend and early this week is a great potential benefit. The six to ten-day outlook (Oct. 13-17) indicates normal temperatures (greater than 50% chance) and 30 to 50% chance of above normal precipitation. The eight to 14-day outlook (Oct. 15-21) indicates a 50 to 60% chance of above normal temperatures and normal precipitation. Producers are concerned currently with dramatically higher input costs that are offsetting higher commodity prices which have dropped some recently. Why are prices so much higher for producers?

Input prices, especially fertilizer, pesticides and fuel, have seen a significant increase in prices over the last year. While commodity prices have also risen significantly over the last year, they have backed down from these highs as fall crop harvest is in progress. The economy in general has also seen these increase in purchased products. But for agriculture in particular, the rise in input prices has been steep. Rather than try to explain everything, let’s focus on fertilizer prices.

• Some fertilizers such as Magnesium, potassium and phosphorus are mined, while nitrogen is manufactured (we are excluding organic sources such as manure here). Mined sources are typically processed, some more than others. Rock phosphate is typically treated with phosphoric and sulfuric acid to make it more available.

• Many fertilizers are combinations of several nutrients such as 10-34-0 (nitrogen and phosphorus) or 18-46-0. This takes further processing and manufacturing and involves energy.

• All fertilizer prices are affected by increased transportation costs, especially those imported involving overseas transportation. And supply chain shortages are involved. This also applies to many pesticides.  

• The most significant increase involves nitrogen. Nitrogen fertilizers are first produced as anhydrous ammonia. All other forms derive from anhydrous (ammonium nitrate, urea, 32-0-0, 28-0-0). This makes anhydrous the cheapest source. Yet even anhydrous is up. Last December it was around $440/ton while this week it’s almost $800/ton and we are heading into the time of year when nitrogen prices should normally drop as demand decreases. The reason is simple. While you only need atmospheric nitrogen as your N source, you also need large quantities of natural gas and huge amounts of power in the form of electricity to generate the temperatures and pressures for nitrogen gas conversion to ammonia. We are all aware of the price increases here.

• One last thing, anhydrous ammonia is also used for more than fertilizer. Its uses include as a refrigerant gas, water purification, pharmaceutical manufacturing, cleaners, and many other uses. So there is competition for this product.

Dr. Victor L. Martin is the agriculture instructor/coordinator for Barton Community College. He can be reached at 620-792-9207, ext. 207, or