By Karn Dhingra
Texas producers are facing a sharp rise in fertilizer costs this spring, adding pressure to already tight margins as global instability continues to ripple through agricultural markets.
Fertilizer prices, which remained relatively steady early in the year, began climbing in March amid escalating conflict in the Middle East and rising energy prices, said Texas A&M AgriLife Extension Service economists.
“Fertilizer is a global commodity, so when disruptions occur anywhere, prices tend to rise everywhere,” said Mark Welch, Ph.D., AgriLife Extension grain economist and professor in the Texas A&M College of Agriculture and Life Sciences Department of Agricultural Economics.
Nitrogen costs drive increases
Nitrogen fertilizers, which are critical for commodity crops like cotton, corn, sorghum, wheat and rice, have seen some of the largest gains.
Anhydrous ammonia prices rose from about $840 per ton in late January to roughly $1,100 per ton in early April, significantly increasing per-acre costs for producers, Welch said.
Other products have followed similar trends. Urea prices have increased about 48% since the beginning of the year, while prices for urea ammonium nitrate solutions are up more than 30%.
Source : tamu.edu