Fertilizer prices on world markets dropped significantly last winter, but because of the buying cycle, it has taken until this year for those lower prices to be reflected at local dealer levels. Gary Hergert, University of Nebraska soils specialist, recently evaluated the fertilizer situation for the coming 2010 season. 

"World urea prices declined significantly since 2008 and were back to 2006 levels this summer," Herget says. "Prices rebounded somewhat recently and are showing some strengthening, but are still well below highs seen last year."

New Orleans urea prices off ship reached a low of $240 per ton last summer, but recently recovered to $320 per ton. Western Nebraska dealer urea prices currently range from $400 to $470 per ton ($0.43 per pound to $0.51 per pound nitrogen).

The best nitrogen buy is ammonia, Hergert says. With the late corn harvest, there was little fall application through most of the Corn Belt and this has created high inventories.

Ammonia fob the Corn Belt is now running just over $350 per ton with dealers asking $400 per ton. In the Panhandle, ammonia ranges from $435 per ton to $480 per ton or $0.26 per pound to $0.29 per pound nitrogen.

Nitrogen solution (32-0-0) is also a bargain compared to urea. Western Nebraska prices range from $205 per ton ($0.32 per pound) to $290 per ton ($0.45 per pound) nitrogen.

"There may be bargains, but you need to do your shopping," Hergert says. "World demand for fertilizer is still recovering. The Chinese had nitrogen export tariffs but are expected to lower these. The Russians have opened a new facility to load super tankers with ammonia, which provides competition for world markets."

Phosphate prices for 18-46-0 (DAP) more than quadrupled before falling back to 2006 levels this spring. Prices currently are running under $330 per ton fob at Corn Belt locations. In western Nebraska, prices for 18-46-0 and 11-52-0 are comparable and range from $400 per ton to $480 per ton.

"In the western hemisphere, potash prices are effectively controlled by the Canadians, who have much of the world supply," Hergert says. "They have the advantage over the Russians and Europeans because they have lower transportation costs to get it to the U.S.

"Potash prices took much longer to decline than nitrogen and phosphorus, but they finally fell last summer from $800 per metric ton to $400. They have recently taken another small drop."

Hergert says fertilizer prices for the 2010 season should be a bargain compared to past years, but you will need to comparison shop.

"It may be a challenge to get soil test results this year because of the late corn harvest," he says. "Soil phosphorus and potassium levels do not change rapidly, so you can use historic field averages as a guideline."

Follow a good soil testing program and if soil phosphorus levels are low, this would be a good year to build them, Hergert says. The key to maintaining profitability is to know your soil test levels and do a excellent job of fertilizer application to enhance efficiency, he says.

Strip-till or zone-till placement of phosphorus at shallower depths (3 to 5 inches below the soil surface) should perform similarly to row application and provide similar efficiency. In more neutral soil pH ranges (6.8 to 7.3), it may be time to look at broadcasting and incorporating phosphorus.

"Take a look at the nitrogen sources you have been using to see if changes could benefit profitability," Hergert says. "Ammonia should be an exceptional buy and nitrogen solution is priced even lower than urea."