Central Florida: The weather in the eastern U.S. continued to be warm – very warm – but the chance for rain was increasing late last week. Crops in the Northeast had begun to shrivel in the fields due to the hot and dry weather, so they may catch a break.
PotashCorp was in the process last week of bringing its processing facility at White Springs, Fla., back online after it was shut down by flooding and a power outage during Tropical Storm Debby a couple of weeks ago. Production of MAP was expected to begin around July 15 -16, but it will take some time to reach normal levels. In the meantime, the company was shipping some MAP – but not a lot – from product that was not damaged during the storm. The company also experienced a processed water overflow during the storm on June 26, which flowed into the storm water system. The incident was reported to local, state, and federal agencies, although drinking water was apparently not negatively impacted.
Meanwhile, Florida was receiving rain on a nearly daily basis as temperatures hovered near 90, which was normal for the state.
Producer inventories continued to be low, and were projected to remain low at least until September. Regardless, there were few buyers in the Central Florida market last week.
The DAP price range for Central Florida was unchanged last week at a flat $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 premium of $20/st FOB in comparison to DAP in Central Florida, about the same difference as from traders. PCS Sales, which produces MAP at its White Springs facility in North Florida, was selling at prices comparable to the market.
U.S. Gulf: The crop-killing heat in the Midwest continued last week and the prospects for rain were only minimal, according to the weather service.
As the dire situation stretched out, the USDA issued a revised estimate that reduced its corn yield forecast by roughly 12 percent, and that meant higher prices for whatever corn survives. The agency also lowered the forecast for soybeans. The government lowered its yield projections by 20 bushels an acre for corn, and 3.4 bushels an acre for soybeans.
The USDA report also started a debate in the fertilizer industry over whether it will mean more or less in sales for P&K.
One school of thought believes farmers will buy less because they will have less money. The other thinks the opposite will happen – farmers won’t want to risk reducing their yields, and will put even more phosphate and potash down than normal.
Regardless, the futures market saw it as reason to kick prices higher, and some were saying corn could reach as much as $10/bushel. However, beef and pork producers were moving to get rid of as much stock as possible to avoid having to buy high-priced feed.
Prices for 2012 corn futures surged last week compared to the previous week, rising from $6.915/bushel to $7.215/bushel for December. The corn price for December 2013 was $6.115/bushel, increasing from $6.08/bushel the previous reporting period. For November 2012, soybeans moved up to $15.225/bushel from $15.1275/bushel the previous week, but soybeans for November 2013 decreased to $12.95/bushel from $13.06/bushel a week earlier. Wheat for July 2013 rose to $8.28/bushel from $8.225/bushel the week before, and wheat for July 2014 was listed at $7.7725/bushel last week, down from $8.00/bushel the previous week.
The Southwestern Fertilizer Conference may not provide much in the way of new business. The mood has been very quiet during the past several weeks, and few in the industry seemed willing to make any rash moves.
With Miss Phos back up and running, some additional supply could become available when the fall season starts in Septemb