Central Florida: Activity and inventories in Central Florida were both low last week, and that will likely continue for at least another month. Inventories were expected to remain low throughout the fall season as export shipping takes up any slack in the domestic market.
The combination of the slow summer season and the Fourth of July holiday apparently offered an opportunity for many in the industry to take the week off, and many took advantage of the situation.
The devastating storms that swept through parts of the Midwest and the eastern U.S. last week took a toll on crops. Metropolitan areas were hit by the combination of a loss of power and high temperatures. Crops were also suffering from extreme heat. Temperatures in Florida were lower than most of the country last week, however, and fewer showers allowed the ground to dry a little after the big rains that Tropical Storm Debby brought the previous week.
PotashCorps’ White Springs processing facility was in the process of restarting after being knocked out by Debby in late June, which caused flooding and loss of power at the facility. It had resumed partial operations and very limited production and shipments late last week. MAP production was expected to return to normal levels on Wednesday.
Traders said the lower priced DAP from sources other than producers was essentially gone last week, which left only producers to supply product, and at a price higher than the $10/st discount offered by traders.
The DAP price for Central Florida changed to a flat $500/st FOB, compared with the previous week’s $490-$500/st FOB. CF’s posted price was at the $500/st FOB mark, and Mosaic was also at $500/st FOB. MAP continued to sell at a $20/st premium to DAP in Central Florida, about the same difference as from traders.
U.S. Gulf: Temperatures in the Midwest were hitting blistering levels of 100 degrees or more in early July. That was expected to moderate somewhat by the weekend, but the cooler weather may arrive too late for some crops.
One of the hardest hit states was Kansas, where corn crops were dying in many areas as temperatures continued to hit triple digits on a nearly daily basis. Many farmers will have to collect on their crop insurance, but that will not provide a winning formula for making a profit. Fertilizers were expected to benefit in the fall, especially potash and nitrogen, provided the long-overdue rains eventually arrive.
As yield projections fell, crop prices increased on the futures market. USDA dropped its estimate for good to excellent corn yields nationally to 48 percent on July 1, down from 63 percent just one week earlier.
Prices for corn, soybeans, and wheat were all up last week. Prices for 2012 corn futures rose to $6.915/bushel for December, up from the previous week’s $6.4125/bushel.
The corn price for December 2013 was $6.08/bushel, increasing from $5.775/bushel the previous reporting period. For November 2012, soybeans moved up to $15.1275/bushel from $14.065/bushel the previous week, and soybeans for November 2013 increased to $13.06/bushel from $12.4475/bushel a week earlier. Wheat for July 2013 rose to $8.225/bushel from $7.985/bushel the week before, and wheat for July 2014 was listed at $8.00/bushel last week, up from $7.9975/bushel the previous week.
The short holiday week made for little activity in the barge market, but few were in the buying mode anyway. The Southwestern Fertilizer Conference in mid-July will provide an opportunity for buyers and sellers to sit down and talk, but whether or not many actual transactions will be arranged was uncertain.
Projections were that prices will be higher through August, but buyers were clinging to the hope that they will deteriorate by September when the fall season gets underway. Low inventories will continue f