Pre-Buying Fertilizer

DoubleR · Dec 21, 2012

Do most of you guys pre-buy your fertilizer? I just use a few ton and just pay what ever the price is in the spring. I got the money set aside for it drawing probably about .00001 percent interest in the bank. Last spring the prices at my supplier were allot higher than they are right now. Just wondering.

IaGary · Dec 21, 2012

I pay for all my inputs right before or right after the first of year depending on my tax situation. Even if I have to borrow the money.

Cash discounts on seed right now is around 7%. If you borrow the money for 6 months it cost you 3% for the interest till June. So borrowing the money you still save 4%.

In 36 years there is only one time I could have saved a few bucks by waiting to pay in spring.

Gary

Lazy WP · Dec 21, 2012

Buy it now, if they will let you. I know when I was in the fertilizer business, there were lots of times we wouldn't allow prepay. Just couldn't figure out what the market was going to do.

DoubleR · Dec 21, 2012

My supplier said yesterday I could pre-buy it before the end of the year if I wanted. He said some guys do according to their tax situation.
He gave me a price list. Depending what I get, it was around 600 bulk a ton, give or take a few dollars.

JD Seller · Dec 21, 2012

I am willing to bet that fertilizer is way cheaper right now than it will be in the spring. Here in North-east Iowa they had trouble getting enough potash for guy to fall apply. The barge traffic has really been effected by the low river levels. So the one that did run where not fully loaded. So the supply will be short come spring until the river/barges get back to normal.

So you very well could save a few hundred dollars per ton on the fertilizer. Just make sure you are dealing with a financially sound fertilizer seller.

paul · Dec 21, 2012

Just bought mine. 3rd biggest chech I've written.

Paul

Bill in IL · Dec 21, 2012

I would book it now if you can. With the way shipping is going on the Mississippi River fertilizer is going to be higher maybe much higher.

Mike (WA) · Dec 21, 2012

Thought I saw somewhere that the price of nitrogen fertilizer was supposed to be going down. Anybody else hear that?

Your results may vary.

RGMartin · Dec 21, 2012

(quoted from post at 14:42:40 12/21/12) Thought I saw somewhere that the price of nitrogen fertilizer was supposed to be going down. Anybody else hear that?

Your results may vary.

Urea was down to $560 bagged a few weeks back. 19-19-19 was $600. I bought and took delivery of enough for a reasonable crop this year. If corn prices still look to be high next year it might pay to gamble and apply heavier than the current plan.

My thoughts are taking delivery is the only way to guarantee that you have it at a given price. If you pre-pay, andyour supplier goes belly up, you become one of many creditors standing in line for your product or money...

Pre-Buying Fertilizer

DoubleR

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IaGary

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Lazy WP

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DoubleR

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JD Seller

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paul

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Bill in IL

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Mike (WA)

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RGMartin

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