USA: Fertilizers at 50%, marking a challenging future

16/03/2022

As American farmers weighed fertility needs, prices and prepaid opportunities last December - and wondered if they should delay purchases, hoping prices would improve before planting season - Corey Rosenbusch, President and CEO of The Fertilizer Institute, made a similar assessment.

“I never would have dreamed where we would be three months later,” says Rosenbusch, adding that “there is even more than we anticipated, and it just keeps piling up.”

Based on what industry insiders tell him, Rosenbusch says an “anecdotal” estimate is that 50% of the fertilizer products farmers will need this spring are in US warehouses and distribution facilities.

“We are by no means at the 100% mark, that is, having everything you need,” he told Farm Journal during a conversation at the 2022 Commodity Classic, adding that “the question now is, what's next? ? What should we prepare for?

Take the bull by the Homs

Farmers cannot fix the situation of fertilizer availability and high cost of inputs, but they can better understand the fertility needs of their crops, even now.

Rosenbusch advises growers to rely on dealers and other agronomic advisors to help them be as efficient as possible with produce. And, once the ground thaws, he says to go take soil samples and find out what they tell you.

“If you're not taking soil samples, if you're not using variable rate application, if you're not using 4R management principles to be as efficient as possible with your fertilizer, now is the time to do it,” he says. “If there is any bright light in the current market situation it is that it will really encourage farmers to adopt and use these nutrient management principles on their farm.”

On the near horizon: Defiant

Assessing the current fertilizer situation, Rosenbusch points out that the United States still faces potential challenges in getting products into the country. At play are what he calls “correlated effects” – multiple factors in the market influencing each other – which combined make the upcoming planting season worrying.

Two unique and potential factors could come into play this season and affect the fertilizer supply for American farmers:

1. A possible strike by the CP railways in Canada. The United States gets 80% of its potash from its neighbor to the north, says Rosenbusch. A railroad strike could mean that no product would cross the border and reach the United States.

In a letter sent March 7 to President Joe Biden, the Fertilizer Institute, the National Grain and Feed Association and 19 other members of the Agricultural Transportation Task Force called on the administration to work with the Canadian government to prevent a large rail labor strike and rescind the cross-border vaccination mandate for workers moving essential commerce.

"We've done everything we can to urge the White House on the serious nature of this coming into the spring season," says Rosenbusch. "We have our partners in Ottawa urging the Canadian government to get involved, because that would be a huge supply disruption to the market if something like that happens."

2. A domino effect created by the lack of access to natural gas. Russia supplies most of Europe's natural gas. That matters to the United States, because nitrogen production is based on natural gas. "So if we do face a major reduction in nitrogen production in Europe, that's going to have, you know, major global ramifications for nitrogen," explains Rosenbusch.

In the United States, farmers may have access to nitrogen, but not in the form they want or are used to using. "They may not find it in UAN form and have to use urea instead," says Rosenbusch, as an example. "So you're definitely going to have to have some flexibility in terms of product type to meet your nitrogen needs."