We recommended getting serious about looking for 2020 nutrients earlier this month, figuring higher corn prices would lure more ground to the nitrogen-dependent crop. A firm tone to the nitrogen market this week indeed is increasing potential a seasonal bottom is in.

Ammonia prices moved higher in some locations this week on the spot market, after reaching near two-year lows earlier in the summer. While moves so far are modest, suppliers are also raising fall prepay offers anticipating farmers will need more product after a terrible spring and fall application season. Retail offer sheets - at least those being updating - are moving lower, with listing on the Plains around $500 a ton. That still looks too expensive compared to wholesale costs at plants in the region, which suggest values closer to $400 or less. But disruptions on the river system remain, which could be distorting the market still. Midwest values won’t be that cheap, but Corn Belt terminals are still running around $320 to $350. Prepay programs for fall are $50 to $75 more, higher than earlier in summer so look for dealers to be above $500, with some closer to $600 depending on the market.

Urea continues to show signs of bottoming, though that trend is more evident on world markets than here in the U.S., where disruptions from weather are still rippling. The latest challenge comes from rains associated with the remnants of Hurricane Barry, which disrupted Gulf ports over the weekend. Gulf prices dropped $6 to around $246.50, and upriver markets were also weaker. Retail values should also start dropping as demand wanes, with wholesale costs suggesting around $350 to $360 is possible. Globally, however, prices are moving higher after a big tender by India. Sharply higher prices are unlikely because there’s plenty of new capacity on the market.

UAN could offer some opportunities for growers with storage as dealers and terminals dump supplies left over from after an early growing season hampered by weather. While the price of 32% at the Gulf slipped just $2.50 to $162.50, plants and sellers further down the supply chain knocked $10 to $25 off their prices to get rid of inventory. That could start knocking supplies at the retail level for 28% down to the $225 level forecast by our pricing model current.

Phosphates remain soft, pressuring DAP at the Gulf to its lowest level in two years. While the world market remains sluggish, the current reading of $305.50 is closing in on the bottom of the complex’s range in recent years, which should begin to curtail production in some countries. Retail prices haven’t changed much, though they’re down from early spring highs after applications slowed by weather. Look for more reductions as dealers begin restocking, with some terminals already $60 or more off recent highs.

Potash prices may have bottomed for the season as manufacturers raise prices following good demand as the market anticipates farmers will boost applications this fall.

While Corn Belt terminals dropped to $293 last week, that’s above their recent low, suggesting current retail prices could be close to the average from spring of $386.

Source: Farm Futures