FERTILISER prices continue to fall across the country, much to the relief of farmers.
Urea prices have dropped 36 per cent in the first quarter of 2023, while DAP phosphorus fertiliser has dropped by 15pc.
Urea prices dropped 22pc month-on-month in January, 9pc in Feburary and 9pc in March, while DAP showed a similar though lesser fall - dropping 8pc, 4pc and 5pc month-on-month per respective month.
The price surges from the Russia-Ukraine war appear to be gone, according to Rabobank agriculture analyst Vitor Pistoia, and he didn't believe nitrogen fertiliser prices would be bouncing back any time soon.
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Despite lowering prices, there continues to be lack lustre demand for fertiliser, but he said there was danger from waiting too long before purchasing inputs.
"Those who have not bought so far are just holding and waiting because prices are dropping week after week," Mr Pistoia said.
While there isn't much time left to purchase phosphate fertiliser, nitrogen topdressing can be purchased much later in the season.
The decision of some farmers to wait before purchasing their top dressing has removed demand from the Australian market, which has created feedback in the supply chain and continued to push prices downwards.
However, if farmers continue to "hold to the bottom," there is likely to be a rush to the market and farmers can miss out on the inputs they need, according to Mr Pistoia.
"When everyone rushes to the market at the same moment, bad things can happen," he said.
"We know that we live in a dry country, and when we have rainfall we must use that rainfall."
Mr Pistoia said farmers should consider how long to hold before buying fertiliser, to ensure they had the right product at the optimal time.
"What's the point if you've bought something cheaper but you can't deliver the best performance you can?" he said.
Weather uncertainty is also influencing demand, as farmers make the decision which crop to move forward with this year.
If weather conditions improve in the Northern Hemisphere, demand will increase and help insulate price.
'Stable' natural gas prices, compared to last year's volatility, are a large factor in lowering fertiliser prices.
The short-term contract for Dutch TTF natural gas is down 48pc since the start of the year, to EUR low-40s/MWh, giving a boost to manufacturers.
The forecast trade value is around EUR 60/MWh, which is under one fifth of the August 22, 2022 peak.
This is promising for farmers who can finally pay less for fertiliser inputs.
