D4—Lancaster Farming, Saturday, March 15,1980
Despite encouraging domestic scenes,
fertilizer costs may remain high
LITITZ A relatively
gentle waiter is one of the
major factors in a brighter
than usual outlook for fer
tilizer availability.
Farmers generally will be
more cautious about over
fertilization of crops this
year, tending to maintain or
even draw against the bank
of fertilizer which has been
built up in past years.
Both factors should serve
to aid production and ease
demand.
On the other side of the
scorecard is/ USDA’s
projected 40 million ton
drawdown in world grain
supplies for the coming crop
year.
This translates into
greater demand for U.S.
grain, presuming this
country remains the major
grain supplier to world
markets.
But early indications are
that farmers do not intend to
change greatly the number
of acres of major crops they
will grow in 1979 and it is
reasonable to presume
fertilization demand will not
grow sizably over last
year’s.
According to the Fertilizer
Institute in Washington,
D.C., fertilizers available for
this Spring will increase
about five to' eight percent
above year ago levels.
Production this year is
higher, and so is the net
balance from import-export
trade.
All nitrogen fertilizers
from natural gas for 180 use
are synthesized by this time
of year. The mild winter
allowed many producers to
keep plants running rather
than closing off production to
allow for home and in
dustrial fuel production.
As a result, production of
atnmnnia is up 10 percent
over the previous year.
Phosphoric acid, the base
material for most
phosphates, is up seven
percent.
Potash production in the
U.S., which supplies only
about a quarter of domestic
needs, was off slightly.
All of that may seem to
amount to lower cost fer
tilizer for 1960. But it just
isn’t so.
Producer-held inventories
of most fertilizers at the end
of December were well
below last year’s levels, so
producer-held stocks at that
time can not be counted on to
provide any big increase in
supply over last year.
Since the pipelines need to
be refilled, much of the
supposed surplus will be
eaten up along the supply
chain, it seems.
Numbers do no good
easing the pain of cost in
creases, but the Fertilizer
Institute offers several
statistics to provide
background.
In December 1979, prices
paid for diammonium
phosphate were 2.8 times
prices charged in 1970.
Ammonia prices increased
A number of volcanoes
on the Hawaiian Islands
are still active Eruptions
in recent years have added
hundreds of acres of land
to the island of Hawaii,
reports National Gcogra
2.6 tunes, muriate of potash,
2.3 times.
Much of the recent jump in
fertilizer prices has been
blamed on the increased cost
of fertilizer production.
Energy costs, not sur
prisingly, lead the lot.
In 1970, the typical natural
gas cost per ton of ammonia
was $11; in 1979 it had
jumped over six times to $69.
Transportation costs,
which account for about 30
percent of the delivered cost
of fertilizer to the farmer,
also have jumped.
Capital cost, the cost of'
borrowing money or holding
inventory, is contributing to
the higher overall cost of
fertilizer to the farmer.
NEWSFROM FACTORY
'/IUAVV 'UV'MN|/».| N
INVENTORY TOO HIGH!!
Due to the mild winter weather Katolight is offer
ing special reduced prices until Factory Inventory is
Reduced to Acceptable Levels.
BRUSHLESS single phase PTO alternators are
reduced to $BOO.OO to $1500.00 below LIST
PRICE! FOR A LIMITED TIME ONLY!
TRACTOR DRIVEN
Model Selection Chart
Model
No.
15LR1
25LR1
35LR1
45LR1
55LR1
85LR1
Engine driven units also available 1 to 1000 KW
for standby or prime power. Single phase wound to
175 KW. Prime power units available to operate on
methane or ethynyl for farm total energy systems.
HARLAN MARTIN
P.O. BOX 35, MARTINDALE, PA 17549
Bus. Ph: 215-445-4800 Res. Ph: 215-267-7771
The industry figures it
costs $7.20 per ton to hold a
single ton of fertilizer valued
at $lBO for the three months
between manufacture and
.delivery. That figure is
generated at 16 percent
interest.
Another factor tending to
maintain higher prices is
international demand for
and use of fertilizer.
Since fertilizer can be
exported freely to most other
nations, the relatively local
demand factors exhibited in
the United States may not be
typical of the international
outlook.
Any drop in the domestic
cost of material will be
Momentary Surge
Watts
15,000
25,000
105,000
35,000
135,000
45,000
55,000
165,000
255,000
85,000
SEE US NOW BEFORE OFFER IS CANCELLED!
MARTIN'S MACHINERY
reflected shortly thereafter
in increased foreign
demand.
Such demand, the industry
says, may pull prices higher
m 1980 as it did in the 1973-74
year when orders exceeded
supply.
Just how intense the
demand pull will be, the
industry says, is not readily
apparent.
So, despite the en
couraging domestic outlook,
outside factors probably will
keep fertilizer costs at or
above current levels.
And any strengthening of
demand on the international
level likely will send fer
tilizer costs still higher.
CH
KATOLIGHT
LR SERIES
Minimum
Required HP
Watts
45,000
75,000
130
C.B.
Amps
Volts
120/240
120/240
120/240
120/240
120/240
120/240
Phase
Wire
100
150
175
225
350
15,25,35,45
55 and 85 KW
SINGLE PHASE
il 45LR1
iroximate Wt.
Ship Lbs.
Net Lbs.
490
425
500
475
600
580
730
670
750
730
860
795