Nogger's Blog

08/07/12 -- As grain prices have been going through the roof, I've been keeping an eye on urea levels going in the opposite direction. Now I freely admit to knowing four fifths of bugger all about the fertiliser market, but as I post weekly updates of fertiliser prices onto Dalmark's excellent GrainPortal.com then I do keep an eye on what prices are doing.

It's been highly noticeable that coming down is what they have been doing. In fact urea FOB Yuzhnyy on the Black Sea has slumped by around a third from USD540/tonne to USD365/tonne between the beginning of May and the end of June.

That's considerably more than the price of crude has declined (20%) during the same period, and takes it to levels not seen in more than a year. It will not have escaped your notice that whilst this 32% demise in the price of urea has been going on Nov 12 London wheat is up by around 20%.

Inputs down 32% and outputs up 20% sounds like an opportunity to me.

My fertiliser price source incidentally is the highly regarded Profercy.com, who tell me that following the announcement of a big Indian urea tender, urea prices are expected to gain sharply next week.

There are a few charts comparing Urea price movements with London wheat and crude oil on the Market Info page which you may find interesting. For some reason these charts load much faster in Chrome and Firefox than they seem to do in IE, so if you are using the latter have a modicum of patience whilst they load.