By John Seewer
The Associated Press
Farmers in Ohio and other corn-producing states are worried that fertilizer prices that have nearly doubled at times in the past year will make earning a profit even tougher this year. Some are switching from planting corn to soybeans and others are planning to use less fertilizer, gambling that those decisions won't lead to disease problems in their fields.
For farmers with cornfields, using anhydrous ammonia or another nitrogen-based fertilizer is often their biggest expense. The price increases this year could mean farmers with 1,000 acres of corn could shell out an extra $10,000.
"We just can't absorb that," said Fred Yoder, president of the St. Louis-based National Corn Growers Association, which represents 32,000 farmers in 48 states.
"We're working on such small margins already," said Yoder, a farmer from Plain City. "This thing could have a $2 billion impact nationwide."
Wholesale prices of anhydrous ammonia jumped from $185 per ton a year ago to $350 per ton in March. It's selling at $320 now, according to Green Markets, a newsletter that tracks the fertilizer industry.
The prices have skyrocketed because of increased prices for natural gas, which is used to make the nitrogen fertilizer. Nitrogen has become a critical component to helping the growth and development of corn crops and increasing yields.
Soybeans, though, require little fertilizer. That's why some farmers are foregoing their crop rotation cycles this spring and planting beans instead of corn.
The number of corn acres expected to be planted this year - 79 million - is unchanged from last year, but it's also about 1 million less than originally expected, according to a U.S. Agriculture Department survey.
In addition to high fertilizer prices, part of the decrease in intended corn plantings, especially in the Great Plains states, can be attributed to expected drought conditions.
Diesel prices are also up and irrigation systems in southern states that are powered by natural gas will cost more to operate, Yoder said.
Many farmers who locked into their fertilizer prices last fall shouldn't be hurt, though.
Mike Clark, who farms 5,200 acres over four counties between Dayton and Cincinnati, said he'll save $40 per ton on liquid nitrogen fertilizer. "It didn't affect me at all," he said. "I think the smaller operators will be affected more by the price increases."