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Iowa Farm Bureau analysts say the ratio of Iowa anhydrous ammonia prices to US natural gas prices has fallen from over 100:1 in 2013 to about 45:1 in 2017, which is closer to the 1990s and early 2000s norm. Anhydrous averaged $367 per ton as of October 2017, versus nearly $900 in 2013, and natural gas is near $8 per thousand cubic feet.
Nitrogen costs are increasingly tied to natural gas, so gas price moves feed into fertilizer costs for corn growers. The narrower ratio suggests fertilizer is no longer unusually expensive relative to gas and corn.
iowafarmbureau.comMichelle Mensing, Decision Innovation Solutions &, Dave Miller: Director, IFBF Research &, Commodity ServicesFeb 2, 2018After 37 past neutral macro events, NATGAS moved a median -0.1% over 5 sessions (49% higher; middle half -4.2% to +12.9%), and -1.1% over 20.
After 10 past neutral macro events, UREA moved a median -0.3% over 5 sessions (40% higher; middle half -0.7% to +2.5%), and -3.9% over 20.
After 78 past neutral macro events, CORN moved a median +0.3% over 5 sessions (55% higher; middle half -1.1% to +1.6%), and -0.6% over 20.
Moves of each commodity's benchmark from the last close before the event. Historical reads pool past events of the same kind; they describe what happened, not what will. Not investment advice.
