Buying fertilizer early can save producers money

Urea fertilizer, 46-0-0, is relatively cheap. Although indications are that prices have edged upward in recent weeks, at one point this summer, urea could be purchased for $400 a tonne or even a bit less. Unfortunately, various factors prevent many producers from taking advantage of great deals on granular fertilizer.

First of all, you never know with absolute certainty that the price won’t go even lower. However, in most years, perhaps eight or nine out of 10, the price is lower during the summer, fall or winter than it is as seeding approaches. This is true of both urea and phosphate.

It’s too bad good analysis of Canadian fertilizer supply, demand and price prospects isn’t more readily available. Still, it’s a pretty good bet that buying fertilizer early will save you money most of the time and sometimes the savings are large.

Another barrier is bin space. Fertilizer bins can be used to store grain during the harvest surge. If you have a good crop coming, you may not want to have fertilizer taking up space.

Cash flow is a biggie. Not everyone has the cash to pay for fertilizer for the 2021 crop before the 2020 crop is even harvested. If you can somehow find the cash, it can be a money-making investment that will quite quickly pay for more fertilizer bins.

Depending on the seeder and the number of compartments in the seeder tank, many producers want a blend of their nitrogen with sulfur, potash or various other nutrients. That’s another problem for early purchases.

Not everyone knows what their crop mix and therefore fertilizer blend might be for the next growing season. On top of that, nitrogen mixed with sulfur stores poorly and is prone to bad lumping. Straight urea can be a bit problematic to get out of the bin in the spring. Mix in sulfur and the problem is compounded.

Here is a low tech solution. Buy urea when it’s cheap. Nitrogen is likely your biggest volume and cost. Then buy your other nutrients when you know what you’re going to need. If you need a blend, you can create that on the farm.

I’ve messed around with transfer augers and conveyors to make a blend, but for next year I’m getting a two-compartment gravity wagon. The wagon has two doors, with everything flowing out the same chute.

If, for instance, you need five parts of urea for every one part of another fertilizer or fertilizer blend, it shouldn’t be hard to adjust the door openings accordingly and let the blend mix in an auger.

Will you end up with exactly the blend you’re looking for? Probably not, but it will be pretty close. The fertilizer has to be handled one extra time to create the on-farm blend, but using the gravity wagon should take a lot of the hassle out of the process.

For me, it’s worth some extra hassle knowing the early purchase saving on urea could be $30, $50 or even $100 a tonne.

And the gravity wagon will be used throughout the year. We haul lots of grain off the field in the fall with gravity wagons. They’re also handy for seed cleaning.

While there’s no 100 percent guarantee that urea will be more expensive next March, April and May, the odds say it will be. If you can overcome the barriers to early purchase, there’s often money to be made.

Kevin Hursh is an agricultural journalist, consultant and farmer. He can be reached by e-mail at kevin@hursh.ca.

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