ST. JEAN BAPTISTE, Man. – It’s almost always better to buy fertilizer in the fall, says a Manitoba Agriculture farm management specialist.
“Definitely fall is traditionally going to make us money,” Dan Caron told eastern Manitoba farmers at St. Jean Farm Days in St. Jean Baptiste.
He said the previous decade saw a major surge and slump in fertilizer prices, but prices in any given crop year are 80 percent more likely to be higher in the spring than in the fall.
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The bottom line difference is significant. Caron said a typical 1,800 acre farm would have saved $90,000 over the past nine years by buying fertilizer in fall rather than spring.
The net gain would have been $40,000 when including storage costs of $10 to $20 per tonne per month and average line-of-credit interest rates.
Caron said fertilizer prices are now close to average after two tempestuous years that saw prices shoot higher, swallowing much of the gains farmers received from higher crop prices.
The 10 year average for phosphate is $509 per tonne, but prices are now around $463. Two years ago, they hit $1,200 to $1,400.
Anhydrous ammonia is also close to its long-term average at about $588 per tonne, or 31 cents per pound, compared to the 10 year average of $542 or 30 cents per lb.
“I think we’re back down into reality,” Caron said.
Farmers need to take their fertilizer pricing decisions seriously, he added, because they make up about 30 percent of the variable costs for the average farmer.
By noticing long-term trends such as cheaper fertilizer in the fall, farmers can take advantage of commodity price cycles like they do with crops.
