After a flurry of price cutting in early July by dealers on the southern Plains, the retail market was most quiet last week. But there were a few hints at a seasonal bottom in nitrogen starting to form, despite mostly bearish global fundamentals. Growers planning on fall applications for winter wheat or corn should be careful about waiting to lock in supplies hoping prices will fall further.
Ammonia was unchanged on our average retail listing last week, though international prices continue to weaken. With Plains dealers as low as $285 to $300, our average retail price is at $435. That’s just $10 or so above fair value based on the Gulf index contract price of $217.50 for July. Corn Belt growers should be shooting for $400 or less from dealers ahead of fall. International suppliers continue to cut production but new facilities in the U.S. have the market on the defensive.
Urea showed a little strength last week on international markets after India put out its latest tender. Costs at the Gulf firmed $10 because excess supplies were turned around exported out to other countries. July swaps settled at $168.50 last week, with October at $183.75, so there still some upside price risk into fall. Wholesalers reflected the firmer tone, though Corn Belt terminals moved up just $2 to $193. Our average retail price slipped $4 to $285. That’s still lower than fair value based on replacement cost, but some southern Plains dealers are as low as $240 this week.
UAN was mostly quiet, but that doesn’t mean growers should be when seeking out deals. July costs at the Gulf for 32% were steady at $127.50, with August swaps down to $120.50. Contracts are only a couple bucks more expensive through the fall, so the market doesn’t seem urgent right now. Our average retail price of $219 for 28% slipped $2.50 this week, but that’s still almost $20 higher than fair value for August. Some dealers on the southern Plains are down to the $200 level we’ve targeted, but Midwest outlets are higher.
Phosphates firmed a little internationally last week as some demand surfaced, but global supplies remain well position to meet buyers’ needs right now. New production coming on line overseas appears to be keeping prices holding to a tight range. Our average retail price for DAP was steady last week at $423.50, a level that’s actually $20 or so below replacement cost. Swaps are a few bucks higher into the fall, so growers should be looking hard for deals.
Potash traders finally got the news they’ve been waiting for, after China stepped back into the market to sign its first deal of the year. Prices delivered are about $10 more than current Gulf values, which edged higher on the news. Corn Belt terminals went the other way, losing $5 to $246. Our average current retail cost of $326 is some $32 above fair value based on that terminal cots, so patience may be needed to find a good deal.