US Grains Mixed as Harvest Advances and Fertilizer Costs Split: DAP Jumps 26.7% While Urea Eases
CBOT soybeans and wheat firmed while corn slipped as the US harvest reached 18% for corn and 17% for soybeans, even as US fertilizer benchmarks diverged sharply, with DAP up $202.48 on the week and urea down $39.18.
Chicago grain futures were mixed in the session covered by Dow Jones Newswires on September 29: November soybeans rose 0.7% to $12.97-3/4 a bushel, December wheat added 0.7% to $6.93-1/4, and December corn slipped 0.1% to $5.22-1/4. Soybean demand was described as the strongest of the three, supported by expectations of additional Chinese purchases and by high energy prices expanding world biofuel production and therefore soybean crush, according to AgResource. Grains were pressured for much of the day by a 10-year Treasury yield at its highest level since 2007, which supports a firmer dollar and makes US exports less competitive.
Harvest is running close to normal but slightly behind trade expectations. USDA's weekly Crop Progress report said 18% of the US corn crop was harvested, against 17% at the same point last year, while soybeans were 17% harvested versus 18% a year earlier, with both on track with the five-year average. Weather remains the swing factor: USDA meteorologist Brad Rippey discussed on September 22 how heavy rains over the previous week were affecting areas of the western corn and soybean belts, a pattern that can slow fieldwork even as it supports soil moisture. Traders were also positioning ahead of USDA's quarterly Grain Stocks report, due at midday on September 30.
Input costs are moving in opposite directions. FertilizerPrice.com's September 30 update shows urea at $730.00 a short ton, down $39.18 or 5.1% on the week, anhydrous ammonia at $815.50, down $42.75 or 5.0%, and potash at $535.20, down $8.04 or 1.5%. Phosphate is the exception: DAP jumped $202.48 to $961.83, a 26.7% weekly gain, while MAP eased $11.59 to $1,016.23 and ammonium sulfate fell $24.65 to $580.55.
Nitrogen solutions were the most volatile part of the complex. UAN 28% rose $90.08 to $600.00, a 17.7% weekly increase, while UAN 32% fell $74.66 to $557.43, down 11.8%. The split matters for fall application budgets: with harvest underway and growers locking in nutrient programs for the next crop year, a 26.7% weekly move in DAP changes the economics of phosphate-heavy blends even as urea and ammonia become cheaper on the margin.