Long-Term Lessons

No matter what the topic, it’s pretty clear that the saying “what goes up, must come down” doesn’t carry much weight anymore — especially in the fertilizer market.

“It was a good year,” says David Benefield, senior vice president of Frit, Inc. “It could have been a much better year, especially when you have $1,000 MAP (monoammonium phosphate) and $600 potash.” Benefield was just one of many in the industry who witnessed escalating prices in a short period of time.

“People get turned off pretty quick when prices start running up that high,” Benefield says. And while that may be true, micronutrient sales for 2008 still remained strong.

“Micronutrients in the past have typically cost a lot more than your NPK (nitrogen, phosphorus, and potassium) materials,” he adds. “Now we look like a bargain.”

Patience Is A Virtue

“Worldwide demand remained very high throughout the season,” says Dr. Dan Froehlich, U.S. agronomy manager of The Mosaic Co. “This led to rapidly increasing prices and spot fertilizer shortages.” For Mosaic, its preseason expectations were met, “but the road to the end was not predictable.”

Froehlich explains: “Cool, wet weather delayed fertilizer application, planting, and emergence of crops throughout North America.” These delays helped dealers sustain their supplies, but also led to a minimized spring application window.

Luckily, this season’s late planting didn’t inflict too many damaging blows to growers and micronutrient manufacturers. Field preparation in soggy soils could have caused severe side wall and soil compaction. “Growers were patient and very few cut back on the needed nutrients or reported compaction issues,” adds Froehlich.

Also experiencing a steady rise in sales was Stoller USA. “The micronutrient sales of our company were greatly over 25%,” says Jerry Stoller, president and CEO. “The irregular planting and the slow growth of the early planting of corn extended our season well passed the normal time period.”

The ‘Cutting Back’ Blues

As growers watch the NPK prices climb higher than their ears of corn, some are starting to cut back on select nutrients, deciding to forego any kind of dry application, which can lead to soil depletion.

“The grower needs to look at the crops requirement for balanced fertility, and often overlooking a micronutrient application can result in diminished yields when omitted from the fertility program,” says Jeff Ivan, manager of marketing for Tiger-Sul Products.

“If they don’t put out the P and the K, they’re certainly not going to put out the zinc to go with it,” Frit’s Benefield explains. “If you don’t use zinc, you’re not going to make the kind of crop you should make.”

In cut-back situations like this, education is key. “The biggest thing we learned [this season] was how many farmers ask retailers what they could do to increase yields,” Stoller says. He believes that retailers are lacking the necessary information farmers need to increase their yields.

Benefield adds: “I understand the nitrogen, phosphorous, and potash prices are at all-time highs, but so are the commodity prices.

“It doesn’t make economic sense for growers to cut their fertilizer application when they realize the commodity prices will more than compensate,” keeping in mind that this may not ring true for crops like potatoes, of which have not seen the rise that corn, wheat, and soybeans have seen, says Benefield. In order for growers to maximize their yields, retailers and manufacturers need to inform them that reducing a full fertilizer program is not the answer.

“There are a lot of people that can’t visualize paying that much for fertilizer, but by the same token, they probably can’t envision ever having gotten $8 a bushel for corn or $14 for beans,” Benefield concludes, especially when corn was $1.85 two years ago.

Combating Costs

Jereleen Brydon of Wolf Trax, Inc. recognized that increased NPK prices affected all crop input prices in a negative manner. “That being said, growers who required additional plant protection products certainly went ahead and purchased them, as crop prices offset these expenses,” Brydon says. “Fortunately we were able to maintain our prices throughout the year, so the cost of using our products was no greater than it was in 2007.”

Wolf Trax also benefited from comparatively low transportation costs. Because DDP Micronutrients are formulated as a dry dispersible powder, Wolf Trax was able to reduce fuel and shipping costs, which helped give them a leg up. “For example, one pallet of Wolf Trax DDP micronutrients replaces 13 pallets of typical granular micronutrients,” Brydon adds.

Unfortunately for Stoller, escalated raw material prices were rather frustrating. “We continuously had to put surcharges on due to the increase of nitrogen, phosphate, and potash.”

QC Corp. President Don Gordon has been told to expect 30% decreases in straight micronutrient inputs, thanks to rising NPK costs. “Where you may see a reduction in straight commodity micronutrient inputs, there will be a continued demand for specialty micronutrient combinations that have unique characteristics,” Gordon says. QC is currently working on slow release micronutrients that are totally water soluble.

Precision agriculture is another way micronutrient retailers and growers can fight costs. “The overall amount of fertilizer used has not decreased dramatically with precision ag, but the nutrient use efficiencies have improved,” Mosaic’s Froehlich explains. “This is good for the grower trying to maximize yield, good for the dealer who can maximize his effectiveness, and good for the environment by only applying the amount of fertilizer that is needed across the field.”

One other prominent trend in reducing fertilizer use came with acreages switching from corn to soybeans. “The economics for soybeans were very good,” Tiger-Sul’s Ivan says.

Froehlich adds: “There was some shifting from corn to soybeans, but not to the extent that was expected.”

What’s New? What’s Next?

From 4,000 acres last year, this year Stoller sold enough PowerPlus to cover 140,000 acres. PowerPlus helps corn crops use nitrogen more effectively. “Last year, we had yield increases where the lowest was 10 bushels per acre and the highest was 71 bushels per acre,” Stoller says. “This is the only product that Stoller ever developed where customers are selling other farmers.”

This August, Tiger-Sul increased in size with the addition of two new production facilities, one of which will be located in Stockton, CA. The company has also licensed its technology to Chemical Initiatives in Durban, South Africa, in an effort to balance fertility in the soils of the African continent.

For 2009, continuous corn will again be a hot topic as grain shortages are expected this fall. “Sulfur and zinc usage is more critical in continuous corn as the soil has less time to recharge,” Froehlich informs. “Sulfur and zinc deficiencies were noted throughout the Corn Belt in 2008.”

As for the years to come, retailers expect the increasing demand for micronutrients continue, particularly with the involvement of China and India as huge consumers. “Once people started getting fed well, they kind of like the idea of being fed well,” Benefield says.

Leave a Reply

Micronutrients Stories

Fertilizer Tender close-up
MicronutrientsHow Micronutrients Fit Into 2017 Fertility Plans
January 10, 2017
Where do micronutrients stand going forward in fertility plans? For one thing, Tim Mundorf, Field Representative with Midwest Laboratories, says Read More
Trey Curtis, Concept Ag owner
MicronutrientsConcept Ag Debuts TransMaxx Technology For Foliar Applications Of Calcium, Other Nutrients
December 15, 2016
Concept Ag Soil & Plant Nutrition has launched TransMaxx Technology, an innovative translocation technology for foliar feeding crop fertility products. Read More
Young Corn Closeup
MicronutrientsBiostimulants And Micronutrients: The Making Of A Market
September 7, 2016
The market for biostimulants and micronutrients continues to grow faster than many other areas of the crop protection market. While Read More
Aerial Photo of Advanced Micronutrient Products in Reese MI
MicronutrientsAdvanced Micronutrient Products Big On Custom Blends
September 7, 2016
John Bowen, whose father started Cameron Chemicals in 1986, has his own unique approach to today’s market. The company evolved Read More
Trending Articles
AgriSync
Matt Hopkins17 Agriculture Apps That Will Help You Farm Smarter In 2017
December 9, 2016
Ag professionals are working smarter, not harder, than ever before. Smart farming technologies have enabled them to reduce costs, maximize Read More
R4023 Sprayer, John Deere
CropLife 100Ag Retail Equipment Report: The Green Party Continues
December 7, 2016
In the annual race for sales in the ag retail equipment marketplace, the color schemes for participants are a little Read More
Mike Stern
Precision AgClimate Corp. CEO Talks Retailer Support For Digital Ag
December 1, 2016
CropLife Magazine’s sister publication, AgriBusiness Global, recently sat down with Mike Stern, CEO of The Climate Corp., following the Monsanto subsidiary’s Read More
Precision AgTrimble Debuts End-to-End FMIS Platform
November 28, 2016
October’s inaugural PrecisionAg Vision Conference left this author with many thoughts and things to ponder in the coming months. Probably Read More
CHS Primeland
CropLife 100The 2016 CropLife 100 Report: Reviewing The Many Bulls And Bears Impacting This Year’s Marketplace
November 28, 2016
For virtually all of 2016, the nation was wholly focused on the big Presidential election. Some folks aligned themselves with Read More
Monsanto sign
Crop InputsMissouri Governor Meets With Bayer CEO To Discuss Monsanto Merger
November 21, 2016
Missouri Gov. Jay Nixon visited Bayer AG global headquarters in Leverkusen, Germany, on November 18 to discuss the proposed Bayer-Monsanto Read More
Latest News
Young Corn Plants
ManagementTimac Agro USA Acquires Michigan Ag Retailer
January 20, 2017
Timac Agro USA, an agriculture supply company specializing in high-efficiency plant and animal nutrition products, has acquired St. Louis,MI-based A&E Ag, Read More
Soybean field
Crop InputsNufarm Teams Up With John Deere Financial
January 19, 2017
Nufarm and John Deere Financial have teamed up to help farmers grow a better tomorrow. This program helps make purchases Read More
Sonny Perdue
LegislationTrump Formally Picks Perdue As Agriculture Secretary
January 19, 2017
U.S. President-elect Donald Trump officially announced Sonny Perdue as his choice for secretary of agriculture on Thursday, selecting a former Read More
ManagementPresident Trump, Wisconsin Review, and a Dow-DuPont Upd…
January 18, 2017
Editors Paul Schrimpf and Eric Sfiligoj reflect on a new administration, a recent winter show, and crop protection company mergers. Read More
Industry NewsBayer, MS Technologies Get China Approval For Balance G…
January 18, 2017
MS Technologies and Bayer have received import approval from China for Balance GT soybeans. The new Balance GT Soybean Performance Read More
Werner Baumann, Bayer AG, and Hugh Grant, Monsanto
Industry NewsReport: Monsanto, Bayer CEOs Among Latest to Make Trump…
January 18, 2017
The chief executive officers of German chemical giant Bayer AG and U.S. seed behemoth Monsanto, Werner Baumann and Hugh Grant, Read More
Giant Ragweed
HerbicidesStudy: Focusing On Weed Seedbank Can Help Manage Herbic…
January 18, 2017
Researchers writing in the latest issue of the journal Weed Science provide important insights on the control of herbicide-resistant giant Read More
Management3 Financial Trends To Watch In Agriculture
January 17, 2017
I recently had the opportunity to attend a meeting of credit managers for Midwest ag supply and input companies, in part Read More
Andersons Retail Store
CropLife 100The Andersons To Close All Retail Stores; Shutdown Does…
January 16, 2017
In a stunning announcement to the Toledo area, The Andersons Inc. said on Sunday that it would close its two Read More
Trimble TMX-2050 In-Cab Display
Eric SfiligojPrecision To Lead Agriculture In 2017?
January 16, 2017
Another new year is upon us! And I’m certain I speak for many in the agricultural world when I say Read More
Corn
Eric SfiligojThe Mood From Madison? In A Holding Pattern
January 16, 2017
Last week, I had the chance to attend the annual Wisconsin AgriBusiness Classic show in Madison, WI. It’s been a Read More
Syngenta Sign
Crop InputsAccenture Helps Syngenta Transform Its Global Logistics
January 13, 2017
Syngenta, a leading agriculture company, has collaborated with Accenture to design and implement a new digital logistics operating model across Read More
Fall Creek Seth Harden The Nature Conservancy
StewardshipLocal Farmers’ Watershed Initiative: Continuous Improve…
January 13, 2017
The goal in the Big Pine Watershed Project is to more intentionally do what local farmers and responsible ag retailers Read More
HerbicidesEPA Expands Enlist Duo Herbicide Registration To 34 Sta…
January 13, 2017
The U.S. EPA has expanded the geography for application of Enlist Duo herbicide from 15 to 34 states. This means Read More
Olson Ag Enterprise
CropLife 100Wilbur-Ellis Acquires Nebraska Seed Retailer
January 13, 2017
Wilbur-Ellis’ Agribusiness, a recognized leader in precision agriculture technology and the distribution and marketing of plant protection, seed and nutritional Read More
ManagementDeere-Precision Planting Update and the Ag Secretary Wa…
January 12, 2017
Editors Paul Schrimpf and Eric Sfiligoj provide the latest on the court date for John Deere/Precision Planting and the quest Read More
Monsanto sign
Seed/BiotechMonsanto, NRGene Form Agreement For Big Data Genomic An…
January 12, 2017
Monsanto Co. and NRGene have announced that the companies have reached a non-exclusive, multi-year global licensing agreement on NRGene’s genome-analysis Read More
AGCO Custom applicator
SprayersAGCO, Asmark Institute To Offer Training For Beginning …
January 11, 2017
AGCO Corp. and the Asmark Institute are collaborating to offer a new training program dedicated to educating and developing custom Read More