As I talk to customers it seems that there must be lower amounts of fertilizer being purchased this fall. I think that there is less fertilizer being purchased for a couple different reasons.
One is that there was a significant amount of equipment and infrastructure purchased by farmers in the spring while prices were double of today. There were many combines, bins and tractors purchased this past spring that I am some farmers would like to rescind their orders on. Calculating your ability to service the debt on a tractor with $15 canola versus $8.50 is much different. Pile on top of this a tightening credit market and spending is tight for inputs like fertilizer.
Secondly, there seems to be a deep conviction that due to Ag commodity prices dropping that fertilizer must due the same. This is more of the theory that I am following. As I have written before either Ag commodity prices are going up or fertilizer must come down. I think farmers are a little bitter to the huge drop in farm prices and locking in high fert prices now would be a double whammy to the income statement.
Across North America this will be a game of poker between the end user and the market makers. Get ready this will be one interesting winter in fertilizer pricing and purchasing