Fertilizer logistics strained with record pace planting
The frenzied push to plant this year's U.S. corn crop in the face of repeated delays has exposed a strained link in the agricultural network: fertilizer.
After one of the slowest starts to sowing on record due to heavy rains, farmers sprinted into action, planting about 42 million acres of corn in one week last month - a record and almost twice as much as the typical season's peak planting week.
However, the logistics for bringing key crop nutrients like urea and liquid nitrogen to the Midwest from the Gulf of Mexico or Canada - and then distributing them to growers - failed to keep pace as dealers were overwhelmed by the surge in demand.
The problem was not the global supply of fertilizer, which is ample; it was getting it to the right place at the right time.
The logistical strain helps explain why it took farmers longer than usual to get their crops fully planted, despite an unprecedented pace in certain weeks. It also fuels doubts about yields, which can be hurt when crops are planted late.
The U.S. Department of Agriculture on Wednesday lowered its outlook for the autumn corn harvest 1 percent from last month due to reduced yield expectations.
"There are a lot of growers that have been impacted," said Alan Hagie, chief executive of Hagie Manufacturing, an Iowa-based manufacturer of self-propelled agricultural sprayers.
"They're struggling to get all this fertilizer on at once and it's moving so much faster than it used to."
Farmers are able to sow crops faster than ever thanks to massive planters that cover 36 rows of corn at a time and feature global positioning systems that allow them to plant 24 hours a day if they want.
Fertilizer dealers, who are accustomed to doling out crop nutrients over a longer period of time, have not seen similar advancements. Many do not keep extra fertilizer on hand, fearing they may be stuck with it in the fall, when prices often drop.
Farmers contract to buy nutrients months in advance but can take delivery at any time over a period of weeks. With heavy rains thwarting planting through much of the spring, precisely predicting that demand was harder than usual.
Key types of fertilizer like urea are imported to the United States from the Middle East and China and travel to Midwest farms by barge up the Mississippi River and then by train or truck.
It takes up to 65 days to move fertilizer from origin to the farmstead, and farmers are able to load out material three times faster than distributors can restock it, according to CHS Inc , the nation's largest farmer-owned cooperative.