The input price risks surrounding growing Australia's winter crop will be much lower this season due to a massive drop in nitrogen fertiliser price.
Urea prices have fallen a staggering 57pc since hitting peaks in excess of $1600 a tonne last year and with current port prices sitting at $680/t, the savings of near $1000/t are helping offset the rise in interest rates.
The massive run up in prices last year was caused primarily by the increase in the price of gas, a key ingredient in urea.
European pipelines to Russia were cut as a result of the war with Ukraine and prices skyrocketed, with urea following suit.
Strong demand from growers internationally as they sought to take advantage of high commodity prices exacerbated the problem, which saw values hit new records.
However, Episode 3 commodity analyst Andrew Whitelaw said in recent months gas prices have come down, as has demand.
Speaking at the Australian Summer Grains Conference at the Gold Coast this week Mr Whitelaw said the grain produced required to buy a tonne of urea had fallen back to more normal levels.
"We're looking at around 1.5 tonnes of wheat and 800kg of canola which is still on the higher side historical but back within the normal range," he said.
On the phosphorus front prices did not supercharge to the same extent last year and so have not come back by as much this year.
They still remain relatively steady at around $1050/t for MAP and DAP type products.
"The P sector is less reliant on gas so there were not the same upward pressures we saw with N," Mr Whitelaw said.
Locally, Mr Whitelaw said fertiliser businesses had been trying to move stocks of higher priced urea in storage but new deliveries had meant the price had come down in line with the global trend.
"Prices here are around $200/t above the international value, which is broadly in line with the historical average, with the figure much higher last year during the period of high pricing," he said.
Peak demand for phosphorus is expected over the coming months in the lead up to the planting of the winter crops while N demand will be a more gradual peak due to the ability to top-dress the product in-crop.
There may be N shortages in the soil after heavy crops or denitrification of the soil due to excessive moisture.
Farmers are now contemplating revising their fertiliser budgets, either to make savings by sticking with existing tonnages of urea or to bolster nutrition by sticking with the budget and purchasing additional tonnes.
Demand for the upcoming year is somewhat of an unknown, given weather models are showing some signs of forecasting a dry season but with many farmers, especially along the east coast, having good moisture at depth from last year's big wet.