Corn, nitrogen and your budget

Are prices superintenents pay for nitrogen-based fertilizers on their way up?

They just might be, if a report we received today from the folks at LebanonTurf is prophetic. Corn futures are closely tied to nitrogen — "As corn goes, so goes nitrogen, and as nitrogen goes, so go fertilizer prices," says Harry Mathis, the corporate director of materials, distribution and order fulfilment for Lebanon Seaboard Corp, LebanonTurf's parent company — so the USDA's recent pessimistic forecast for corn could be a reason for concern for end-users like superintendents.

The USDA recently adjusted its forecast for corn downward by 3.6 percent, which sent corn futures soaring to near $6 a bushel, a price point that encourages farmers to plant more corn and which, in turn, requires increased nutrients. The subsequent rise in demand for nitrogen results in an increase in costs to fertilizer producers such as LebanonTurf.

After that initial rush, market conditions have stabilized some in recent weeks. But Mathis is still calling for the price of fertilizer products high in nitrogen, phosphorous and potassium to increase by 10 percent or more during the 2011 growing season. That's the famed "N, P and K" in superintendent circles, and that's disconcerting news for turf managers who rely on those nutrients to keep turf healthy.

"We were sailing along in pretty stable condition this summer, and then the USDA numbers and the corn harvest sparked the markets," Mathis says. "It just goes to show how fragile and interconnected the supply chain is."