The Southwestern Fertilizer Conference is poised to set another attendance record July 24-27 in San Antonio. As of last week, some 1,315 were registered, with another 100 normally signing up onsite. This would take attendance beyond last year’s record 1,357. And the conference has already set a record for meeting rooms and suites, at 131.
Those meeting rooms may be well used, as everyone and their brother this year said that dealers planned to end the season with empty bins. And with those empty bins, what are they finding now? Higher prices. At a time when fertilizer prices tend to languish, after the spring season, prices are on the uptick – spurred, say sources, by healthy DAP, urea, and UAN exports that have effectively taken excess product out of the market. In addition, a strong international market, particularly for urea, has kept imports away. Industry consolidation doesn’t hurt either, noted some sources. As a result, for the weeks leading up to the Southwestern Conference the industry has seen quick-paced increases in urea, UAN, ammonia, and DAP in particular.
Other players say that not everyone needs to buy fertilizer right now. However, the general sentiment is that those that do may indeed have to pay up, as NOLA inventories have been depleted. Sources said there is a particular impetus for those needing product for wheat acres, and also for anyone needing product to go on the Arkansas River, as locks are expected to go down for repair toward the end of August.
On the urea front, some buyers predict that resistance may start to be met, or that higher prices will attract imports. Regardless, buyers are hopeful that regular contract shipments of urea will begin to come in later in the summer. And sources say any downturn in corn and other commodity prices could turn fertilizer market psychology downward; however, for now, higher corn prices have been pumping up the bull market.
Still others say they are used to the hype. “Pure greed and an unwillingness to say no seem to be driving the market today. Déjà vu to 2008,” said one with memories of a few years ago.
“Everyone is wondering if the bulls are polishing their horns for the meeting,” said another. “We plan on taking our cape, hollering ‘Toro!’, and getting the heck out of the way!!”