Fertilizer expert concerned about 2023 prices


Fertilizer expert concerned about 2023 prices

A fertilizer market expert is concerned about the cost of growing the 2023 crop.

John Linville with StoneX says natural gas supplies in Europe come from Russia, and those prices have gone higher, which Linville says affects the price of nitrogen. “With natural gas where it is, we’re estimating it costing around a thousand dollars, per U.S. dollar, to produce one ton of urea, and about two thousand dollars to produce one ton of anhydrous.”

Linville says that’s a double-edged sword because of lost supply in a tight world market and demand doesn’t go away. Linville tells Brownfield he’s not concerned about fertilizer availability in the U.S. but he is concerned about price. “We can make a lot of planning. We can start to move the product around. I’m not longer in the camp of we’re not going to have enough product to grow the crop that we think we need to grow, but the price I think is the reason why I’m not as concerned. I think the price will move to a level that will shut down some demand.”

But Linville does not expect a big change in that demand based on his early 2023 acreage estimates. “We’re putting our corn acres at 92, our beans at 89, our wheat at 49-5, and are those going to change? Absolutely, but you look at those and we still see a lot more upside than downside on the fertilizer demand and it looks like demand is going to stick around for a while.”