Montana State University Extension farm management specialist Andrew Swanson and soil fertility specialist Clain Jones provided recommendations on April 14 for agricultural producers facing higher fertilizer prices.
Rising fertilizer costs are affecting Montana farmers as global disruptions impact supply and input expenses remain high. Swanson said, “Even though the U.S. produces the majority of its own nitrogen fertilizer, fertilizer prices are susceptible to global shocks, just like Montana wheat prices can be affected by supply conditions in Australia or Canada.” He noted that recent trade disruptions have caused urea prices at New Orleans wholesale terminals to increase from $360 per ton in February to nearly $650 per ton in March, while Montana’s urea price rose from $700 to about $1,000 per ton.
Swanson explained that tight profit margins mean farmers must carefully calculate nitrogen cost per pound. “At $1,000 per ton of urea, a pound of urea costs $0.50. Since urea is 46% nitrogen, a pound of nitrogen costs $1.09 when supplied by urea. This means that each additional pound of nitrogen applied needs to generate at least $1.09 of revenue through higher yields or protein premiums.” He added that tracking yield gains relative to local wheat prices can help guide decisions.
If current conflicts resolve soon, Swanson said he expects price impacts will continue into next year’s growing season: “Typically, major disruptions like this take at least a year to cool.” He suggested prepaying local suppliers as one way to manage prolonged elevated prices and mentioned new margin protection insurance products now available for wheat growers in select counties.
Jones recommended comparing the cost efficiency between granular and liquid fertilizers and using MSU’s online calculator for determining optimal nitrogen rates based on current market values. He highlighted practices such as minimizing nutrient losses through proper application timing and placement—”Volatilization…of nitrogen fertilizers is likely the largest loss of nitrogen in Montana,” Jones said—and adopting variable-rate application technology as ways producers can optimize spending during periods of high input costs.
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