[et_pb_section fb_built=”1″ disabled_on=”off|off|off” _builder_version=”4.24.2″ custom_padding=”0px|||||” global_colors_info=”{}”][et_pb_row disabled_on=”off|off|off” _builder_version=”4.24.2″ _module_preset=”default” global_colors_info=”{}”][et_pb_column type=”4_4″ _builder_version=”4.24.0″ _module_preset=”default” global_colors_info=”{}”][et_pb_audio audio=”www.genesisfertilizers.com/wp-content/uploads/Audio/240320MarketReport.mp3″ title=”Listen to the Market Report” disabled_on=”off|off|off” _builder_version=”4.24.2″ _module_preset=”default” title_font_size=”20px” width=”33%” width_tablet=”33%” width_phone=”100%” width_last_edited=”on|desktop” max_width=”100%” custom_padding=”20px|20px|20px|20px|false|false” link_option_url=”www.genesisfertilizers.com/wp-content/uploads/Audio/240320MarketReport.mp3″ global_colors_info=”{}”][/et_pb_audio][/et_pb_column][/et_pb_row][et_pb_row _builder_version=”4.16″ background_size=”initial” background_position=”top_left” background_repeat=”repeat” global_colors_info=”{}”][et_pb_column type=”4_4″ _builder_version=”4.16″ custom_padding=”|||” global_colors_info=”{}” custom_padding__hover=”|||”][et_pb_text admin_label=”Text” _builder_version=”4.24.2″ text_font=”|300|||||||” text_font_size=”16px” text_line_height=”1.3em” header_line_height=”1.2em” header_2_line_height=”1.2em” header_4_font_size=”32px” header_6_line_height=”1.3em” background_size=”initial” background_position=”top_left” background_repeat=”repeat” header_font_size_tablet=”” header_font_size_phone=”28px” header_font_size_last_edited=”on|phone” header_4_font_size_tablet=”32px” header_4_font_size_phone=”22px” header_4_font_size_last_edited=”on|phone” global_colors_info=”{}”]Fertilizer Market Report – March 20, 2024
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In this week’s fertilizer report: NOLA urea futures forward curve; 2023 upward trends in farmland values suggest a resilient market; North American urea and MAP prices; and industry tidbits.
News of the Week: Fertilizer Market Report
NOLA Urea Futures Forward Curve in Steep Backwardation
How quickly price expectations change in commodities!
The chart below shows the forward NOLA Urea futures curve on two different days. Series 1 shows the expected forward prices on January 2, 2024. You can see how March moved from US$318/st to US$385/st from January 2 to March 18. Also on January 2, the market was expecting forward prices to be flattish. Series 2 shows forward price expectations on Monday March 18. The market is now anticipating a steep backwardation in forward prices meaning the market expects future prices to be much lower than spot prices. Normally when the market sees this in the futures market, buyers will hesitate to build long physical positions. It’s a wait-and-see game now heading into spring.
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This great article from FCC Knowledge outlines provincial trends in cultivated land values. The analysis covers the Jan 1 – Dec 31, 2023 period and displays the average land value changes over that period. Interesting to read that strong field crop receipts between 2022 and 2023 suggest a correlation between liquidity and demand for farmland which drove prices up. Strong farm current ratios in 2022 supported the demand for land. Farm profit margins expected to be tighter in 2024 could impact the demand for farmland.
North America Urea Last Week
India issued a long-awaited urea tender. The market, however, did not react due to a few reasons — no indication of volume, the tender close date is March 27 and the shipping window is extremely long with a shipping deadline of May 20. This gives the market plenty of time to react.
According to Green Markets, urea prices in Western Canada were flat WoW in a range of C$750-$765/mt DEL for the third week in a row. These prices are up C$93/mt or 14% since the recent trough of C$665/mt seen in early January.
Earlier this week we heard of offers of prompt at C$800/mt and May at C$830/mt FOB Gravelbourg SK.
NOLA urea prices rose again to a range of US$375-$417/st from US$367-$400/st last week on the back of strong demand and limited supply. The market is also showing backwardation with the first half April trading at US$375-$380/st.
It appears that the market did not anticipate such an early start to spring seeding in the US and therefore the urea supply continues to tighten pushing prices up.
We believe that prices in Western Canada could pop again once spring seeding starts.
North America Phosphate Last Week
According to Green Markets, the latest delivered MAP prices were flat WoW in Western Canada in a range of C$1,120-$1,130/mt for the fourth week in a row. MAP prices have risen 38% since early July 2023 in Western Canada.
We heard of two MAP offers in Southern SK at C$1,165/mt for prompt and C$1,190 for Spring FOB.
MAP NOLA prices were down to a range of US$620-$640/st from US$640-$650/st the previous week.
We’re hearing some chatter about MAP supply being tight in North America. You might want to speak to your local phosphate supplier to fill your bins sooner rather than later this spring.
Industry Tidbits
- TFI: Phosphate and Potash are Critical Minerals, Senate Bill to Solidify | The Fertilizer Institute
- Maximizing Crop Health: The Significance of Micronutrients in Modern Agriculture | Waypoint
- Bank of Canada will need to cut interest rates – USD/CAD to jump above 1.40 | Forexlive
- Joanne Paulson: Farmland values rise again in Saskatchewan | The Star Phoenix
- Northern Ontario farmland values climbed in 2023 | Village Report
- International expert’s tips on ramping up soil carbon levels | Farmers Weekly (fwi.co.uk
- Manitoba crop study shows ‘significant contributions’ to local economy | CTV News
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