A quick check on the effects of N costs on spring N rates

April 13, 2021 11:43 AM
Blog Post

Does the recent increase in nitrogen (N) cost and the increase in corn grain price warrant a change in nitrogen rates in 2021?  The following discussion gives an overview of the current N cost and corn price situation

New crop corn for delivery during the fall of 2021 was $4.05 per bushel locally on January 10, 2021.  And the price of a ton of anhydrous ammonia was $415 per ton the fall of 2020.

Fast forward to April of 2021 and new crop corn for delivery in the fall of 2020 is $4.60 per bushel and anhydrous ammonia is $690 per ton.

A quick look at the Corn Nitrogen Rate Calculator can give us some answers.

 

                                                                        spring 2021     fall 2020

Nitrogen price ($/lb)                                       0.42                 0.25

NH3 cost ($/ton                                              690                  415

Corn price, ($/bu)                                           4.60                 4.05

MRTN rate (lb N/acre)                                   143                  153

Net return to N at MRTN rate ($/acre)           252.60             240.07

NH3 cost at MRTN rate ($/acre)                    60.06               38.25

 

This info shows a 66% increase in the cost of N from last fall to this spring.  Corn grain price has increased about 13% since January.

So, should the N rate be adjusted as a result of a greater increase in the cost of N as compared to the smaller increase in the value of corn grain?  This info - based on the Corn Nitrogen Rate Calculator would suggest a 10 lb/a reduction in N rate.  Obviously, the increased value of corn grain did not make up for the increased cost of ammonia. 

Many agronomists and farmers would argue the practicality of an N rate reduction by 10 lb/acre.  However, this info does show the importance of N fertilizer. So even though N costs have increased over $21/acre since last fall in this example - the net return to N fertilizer is only reduced by about $12/acre as a result of the 66% increase in anhydrous ammonia cost.

This scenario was calculated with anhydrous ammonia, a corn soybean rotation and in the main part of Iowa.  The Corn Nitrogen Rate Calculator would allow you to evaluate other rotations, other N sources and other geographies. 

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Paul Kassel Field Agronomist in NW Iowa

Paul Kassel provides research based crop production information to area farmers and agribusiness. Educational programs are available for farmers, agribusiness, pesticide applicators, and certified crop advisors.

Areas of expertise include soil survey, crop production, soil ferti...