A new economic analysis from Texas A&M University has raised red flags for corn growers concerned about rising input costs.
The study found a longtime historical correlation between corn prices and fertilizer prices.
“Those lines kind of lay right on top of each other, which means fertilizer and anhydrous ammonia prices have been moving in a lockstep with the price of corn for quite some time, and more so now than in the past,” said Joe Outlaw, lead researcher for the study.
From the end of 2020 to October 2021, anhydrous ammonia prices rose by $688 per ton. And now, a petition by CF Industries for the U.S. International Trade Commission to impose tariffs on nitrogen fertilizers from Trinidad, Tobago, and Russia could drive prices even higher.
“If tariffs create a supply shortage, it will drive up the cost even more,” said Chris Edgington, National Corn Growers Association president. “Our request is simple. We’re just asking that these companies keep us out of their trade disputes and do everything possible to keep their products available and affordable for family farms.”
If continued cost increases leave farmers unable to afford fertilizers, a corn shortage could be on the horizon, according to producers.
“In the United States, we have a lot of supply chain issues. We could certainly be setting the table to have supply chain issues next year with shortages of corn,” said Jay Schutte, a Missouri corn farmer. “We can only control so many factors in the growing cycle. The two biggest limiting factors for the corn yield are the amount of nitrogen we put on, and the amount of rain we get. We certainly can’t control the rain, but we can control the nitrogen we apply.”