Fertilizer prices wilting
4/1/2010Fertilizer prices, which have had a habit of rising in the spring like flowers, are showing signs of stunted growth this season, much to the joy of consumers and farmers.
"Prices spiked up during the fall, then it came back down recently. Overall, they are about the same as last year," said Terry Irmen, a seasonal retail garden supplies buyer for The Andersons Inc.
The price for a bag of fertilizer for 5,000 square feet of lawn at The Andersons store is about $14, he said. Last year, it was $15 to $18.
Mike O'Rourke, manager of the Black Diamond Garden Center in Toledo, said fertilizer prices at his retail center had not increased, with a bag for 5,000 square feet costing $10 to $18, depending on the ingredients.
"The only thing that has gone up is the [wholesale] transportation and freight prices and that's only a little bit," he said. "But the price of the fertilizer itself hasn't gone up at all, maybe just a few pennies.
"Consumers have been hurt hard," Mr. O'Rourke said. "I think the wholesalers did not want to increase the prices this year."
At Jacob's Garden retail center in Lambertville, fertilizer is being discounted by 25 percent, manager Kyle Jurgenson said.
He said that is a bigger drop than the store's margin on fertilizer.
For farm fertilizer, prices in 2008 averaged close to $500 a ton, almost triple the 2007 average price. Some phosphates sold for more than $1,000 a ton and anhydrous ammonia for $800 a ton
Barry Ward, an agricultural economist at Ohio State University, said anhydrous ammonia is now at $400 to $450 a ton and other fertilizers are much lower than they were last year.
"We started last season with lower prices than the year before, but we are lower than that now and in - whatever you want to call it - a more normal range. We are not near as high as 2008," Mr. Ward said.
The previous rising prices were because of high demand and weak supply, he said.
Rising commodity prices in 2007 encouraged the agriculture industry worldwide to increase its acreage in 2008, driving fertilizer prices upward.
"There was also more competition from some of our Asian and South American competitors," Mr. Ward said.
But three things in the last 12 to 18 months have pushed fertilizer prices down, helping consumers and farmers, the OSU economist added.
Pushing down fertilizer prices, the OSU economist said, are fewer acres being planted worldwide, falling prices of oil, which is a component in some fertilizers, and increased production and supplies of fertilizer.
Contact Jon Chavez at:
jchavez@theblade.com
or 419-724-6128.