John Deere Lesco prices going way up

[Jimmie]

I guess John Deere needs to make money fast after buying Lesco a 50 pound bag of 24-2-11 might cost you $3 to $4. more last time I checked.

[rcreech]

I guess John Deere needs to make money fast after buying Lesco a 50 pound bag of 24-2-11 might cost you $3 to $4. more last time I checked.

Are you familiar with what is going on right now with the N market? With this post I am assuming you are not.

It has nothing to do with JD buying Lesco! I called around and my Lesco/JD store is almost cheaper on everything.

Call around and you will find that all suppliers fert is going up quickly. The N market is going crazy...and all fert suppliers are following suite.

I bet JD is in the same boat as us....they will be charging more and have shrinking margins.


MY ADVICE:

You better get your N bought ASAP. Talked to a friend in the retail fert business and he claims that there may be a fert shortage in the spring and that it may be hard to find. I am stocking up BIG TIME!

It will pay you to borrow the money with the increase in fert and that way you have a fixed cost and don't have to worry about availability!

[MStine315]

I will give Lesco credit, my local rep. called me today saying they were adjusting prices next week and if I needed anything to finish up the year I should get it asap. That's called a good rep. Someone who looks out for you.

[RigglePLC]

My dealer told me nitrogen was up around 34 percent.

[Forever Green Lawn]

There is a price increase coming on the 26th of Nov and again in Jan '08 from Lesco. Every supplier is raising prices. If any of you guys use starter fert for anything, better get it asap as the prices on it are going evern higher. Shop things around as best you can, it's going to be an expensive year for fert!

[RigglePLC]

The Lesco website shows my price on my favorite crabgrass control product has gone up 14 percent. As of November 17th--but I expect further increases.

[Jimmie]

Are you familiar with what is going on right now with the N market? With this post I am assuming you are not.

It has nothing to do with JD buying Lesco! I called around and my Lesco/JD store is almost cheaper on everything.

Call around and you will find that all suppliers fert is going up quickly. The N market is going crazy...and all fert suppliers are following suite.

I bet JD is in the same boat as us....they will be charging more and have shrinking margins.


MY ADVICE:

You better get your N bought ASAP. Talked to a friend in the retail fert business and he claims that there may be a fert shortage in the spring and that it may be hard to find. I am stocking up BIG TIME!

It will pay you to borrow the money with the increase in fert and that way you have a fixed cost and don't have to worry about availability!

Thanks for the good advice, but this increase is not due to cost of nitrogen (that might be coming) this was a adjustment to how much John Deere what's to make off a bag of fertilizer.

[rcreech]

Thanks for the good advice, but this increase is not due to cost of nitrogen (that might be coming) this was a adjustment to how much John Deere what's to make off a bag of fertilizer.


Jimmie,

Again....my Lesco is the cheapest around on almost everything I checked on.

Why would JD jack up the prices as you say? They know they have to stay competitive or we will go somewhere else!

Also....the N market has gone up like crazy since spring. How can you say these increases are not due to the cost of N? Everyone knows that the N market has been going nuts! I bought some of my product back in August (for my 2008 season) and it has almost gone up almost $.70/bag. That increase is due solely to the N market.

It is suppose to go up another 10% next week and I heard it is open game after Jan 1st.

Good Luck!

[jbturf]

keeps making me think us small guys need to team up some
how to get some better buying power like the big guys-

at least i was told control products will be roughly the same, and
less in some cases. supposedly(im told) JD has a better contract
with dow, for lower prices on such things as dimension

heating oil prices are my current subject of attention.
prices are going up on everything

[whoopassonthebluegrass]

I can't afford fertilizer anymore. I'm just having my wife and kids poop in bags and then taking that to spread... Then I charge extra for being organic.

[rcreech]

I can't afford fertilizer anymore. I'm just having my wife and kids poop in bags and then taking that to spread... Then I charge extra for being organic.

You may not want to pick up too many more lawns...or you will have to have more kids! :laugh:

[whoopassonthebluegrass]

You may not want to pick up too many more lawns...or you will have to have more kids! :laugh:

Actually, I'm in negotiations with a middle school right now.

And I'm hoping to work something out with the professors at our university. If anybody around here is full of $hit, it's them.

[PHS]

rcreech,
Since you are more involved in agriculture, do you know why the fert market is going haywire? Is it tied to the ag market primarily? It makes sense that with cost of oil going up shipping and manufacuring costs are going up that the end price would go up but that wouldn't explain shortages. All the additional corn being grown for ethanol? Cost of natural gas up?

[rcreech]

rcreech,
Since you are more involved in agriculture, do you know why the fert market is going haywire? Is it tied to the ag market primarily? It makes sense that with cost of oil going up shipping and manufacuring costs are going up that the end price would go up but that wouldn't explain shortages. All the additional corn being grown for ethanol? Cost of natural gas up?

There are serveral reasons for the increase in N over the last year:

1) With the increase in ethanol it is taking more corn...which means many more acres are needed to meet the demands. Depending on the area of corn production a corn acre takes 180-230 units of N.
2) The increase in natural gas and petroleum products have gone through the roof. Natuaral gas is used to produce urea.
3) Exporting is at all time highs! China and other countries are using more fert now then ever.

I am sure there are more reasons then I have listed...but these are the major reasons.

All these combined...we are pretty much screwed!

[americanlawn]

Nuther reason: the U.S. dollar is worth less now. Maybe Hillary can fix it.:laugh:

More farmers in Iowa are trying to plant more corn acres and less in soybeans cuz the profit is higher in corn now.

Got prices from LESCO and UAP last week. Normally LESCO saves us a substantial amount, but UAP is in the same price range. My UAP guy also said "contol products" have actually come down a little, but the nitrogen has increased all year long. I normally make a decision quickly, but not this time -- hoping to "negotiate" a little better price. Might have to play with terms and delivery dates. We'll see, but I know I better decide very quickly.

So far, it looks like it's gunna be at least 2 bucks per bag more this year for the PRE + FERT. I talked to two of my local guys here who buy from us so they save money.......they said, "Just get the best price you can".

Unless we open the Alaska oil fields, I don't expect things will get better.

I like whoopass's organic idea.:laugh:

There are serveral reasons for the increase in N over the last year:

1) With the increase in ethanol it is taking more corn...which means many more acres are needed to meet the demands. Depending on the area of corn production a corn acre takes 180-230 units of N.
2) The increase in natural gas and petroleum products have gone through the roof. Natuaral gas is used to produce urea.
3) Exporting is at all time highs! China and other countries are using more fert now then ever.

I am sure there are more reasons then I have listed...but these are the major reasons.

All these combined...we are pretty much screwed!

[ampeg76]

the alaska deposits will do little to help our addiction, just a small fix for the dopefiend:(


it will take 10 to 15 years to get usable oil from the northern slope, by that time our consumption will be way over the 20 or so million barrels a day, the amount available would last us 3 to 4 years, time to quit plugging the crack in the dam

cheers

[whoopassonthebluegrass]

the alaska deposits will do little to help our addiction, just a small fix for the dopefiend:(


it will take 10 to 15 years to get usable oil from the northern slope, by that time our consumption will be way over the 20 or so million barrels a day, the amount available would last us 3 to 4 years, time to quit plugging the crack in the dam

cheers

You may be right, but if we start now, it'll send a message to the manipulative a$$holes killing our profit margins that we aren't going to tolerate it. I guarantee it'll drop prices if we do it.

Same thing with shale. It's cost effective so long as oil remains above $30/barrel.

We need to stop putting other people's feelings above our own needs and we need to stop thinking animals and trees are a higher priority than humans. I'm not saying there shouldn't be checks and balances - there should - but who the hell cares about drilling in our least populated state? Who the hell cares if we eliminate a certain mouse? If you can get the whole country to support THAT B.S. over drastically lowering our costs as workers AND consumers, then I'll stand corrected. Until then, we should send all the damned libs to Azkaban.

[LIBERTYLANDSCAPING]

If we would have started after the oil 10-15 years ago, we'd be getting it now... Man, it's a good thing the DAMN Liberals didn't get there way back in the early days of this country, or we would all be living in grass huts:hammerhead: (Mine would be green & weed free...):laugh:

[Marcos]

I will give Lesco credit, my local rep. called me today saying they were adjusting prices next week and if I needed anything to finish up the year I should get it asap. That's called a good rep. Someone who looks out for you.

Yeah, They're looking out for you, all right!

The Lesco reps are all paid on a yearly goal commission scale that follows the calendar year.
Yes, they may be truthful in that they'll be price increases on the horizon, but don't think for a minute that they're not taking advantage of the timing of all this to cry "the sky is falling" a little so they can pay their family's Christmas bills!

[rcreech]

Yeah, They're looking out for you, all right!

The Lesco reps are all paid on a yearly goal commission scale that follows the calendar year.
Yes, they may be truthful in that they'll be price increases on the horizon, but don't think for a minute that they're not taking advantage of the timing of all this to cry "the sky is falling" a little so they can pay their family's Christmas bills!

I am sure they are "helping themselves" but hey atleast they are helping us also. I am sure there are some behind the scenes that goes on...but moral of the story we are all doing this to make $$$$$.

So if they can make thiers while saving us some...I am cool with that!

[PHS]

Exactly. The reps are providing a service for their customers and they should be paid for it just like I should be paid for the services I provide for my customers. In fact I would rather have them making a commision so that they have an incentive to take their job seriously rather than just have hourly waged employees that don't care one way or another.

Salespeople do resort to the "The sky is falling" routine to get people to act but it's my job as a consumer to be educated too as it is my business afterall.

[Mscotrid]

Yeah, They're looking out for you, all right!

The Lesco reps are all paid on a yearly goal commission scale that follows the calendar year.
Yes, they may be truthful in that they'll be price increases on the horizon, but don't think for a minute that they're not taking advantage of the timing of all this to cry "the sky is falling" a little so they can pay their family's Christmas bills!


Obviously you know less than you think. Lesco reps fiscal ended 10-31-07, they are operating on 2008 fiscal. Before everyone slams there various reps form whoever we might buy from check the facts. Years past there have been talks of increases that never materialized but everything I can read on the net tells me different. I'm not talking BLOGS here, actual industry sites. All nutrients are going up, N-P-K also the macros are increasing. Factor the cost of shipping and packaging.

Bulk pricing per ton will be up between a $150.00 to $225.00 per ton depending on nutrient. Tie that in with the antiquated processing facilities and the "Global" demand on these products you will find the answer. We, the lawn care industry are a small consumer in the grand scope of the Fertilizer market. If you are not prepared to raise prices 15-20% next year you will be playing catch up all season.

If you have storage and cash flow protect yourself and you will be ahead of your competition next season.

[Marcos]

Lesco reps fiscal ended 10-31-07, they are operating on 2008 fiscal.

Well, if that's true, that's a departure from what they're done in the past.
Up until the end of 2005, I'm positive all of their bonuses hinged on sales all the way up to the end of the year.
( I know a rep paid off that plan)
Maybe they changed things to align themselves with Deere's corporate plan in 2006, or this year.

After all, ' Lesco ' in many ways is just a marketing name now; and for all intents and purposes, their key corporate decisions are now made by Deere people.

[MStine315]

If you don't like your rep. or JD or Lesco, that's fine, but my reps. have always looked out for me and I don't think for a minute it's anything other than that. Besides, they'd only cry wolf a time or two before they'd shoot themselves in the foot anyway.

[Marcos]

If you don't like your rep. or JD or Lesco, that's fine, but my reps. have always looked out for me and I don't think for a minute it's anything other than that. Besides, they'd only cry wolf a time or two before they'd shoot themselves in the foot anyway.

Unfortunately, the Lesco sales reps have a lot less lee way from their corporate office than you think they do when it comes to pricing.
I know that to be a fact before the JD buyout.
I expect that it wouldn't have gotten any better since.

[bug-guy]

i work at john deere landscapes/lesco. our fiscal year ended oct 27 for the first time this can all be found in the jdl stock info. so the cost increase has nothing to do w/bonus. i can tell myself and the other mgrs in my area hate raising $. we deal with alot of great people very closely. and have some nice relationships outside of work but when our $ go up it needs to be passed on. the problem is YOU can't raise $ every couple of months to your cust.
this usaully effects guys who cut their prices too close to their cost i know some small companies who charge 25 % or more less than others this is why they have great new sign ups but cost increases hurt more. these are also the comp who are alway chasing the mail for checks.
we need to look at a few things the us $ is down oil prices are tied to it
it takes petro and nat. gas to make fert, shipping heavy items cost more.
it looks like urea will rise the most so changing to a fert w/ a split might help the reason you hear mixed comments from people some were getting some really low $ and this are the one going up the most, i can't really get into that too much here.
i only hpoe we all get past this adjustment.

[Harley-D]

I've tried to be optimistic from about a year and a half ago. This is when oil went up over $80/barrel. It is also when the housing market came to a screeching halt here. Since then, very few houses have been built, oil's over $95/barrel, many people have lost there jobs (local builders laying off & 12k from chrysler somewhere in mich i think), and everyone bitching about how they are going to make the payments on that new whatever they bought last week for 30k. First off, i started socking money away about 18 months ago and know of alot of other companies doing the same. We are on the edge of the cliff and are about to fall off. Some are in denial Some are wearing a parachute, some are not. Those that are not, did not plan for it and won't make it.
Anyone old enough to remember what big landscape companies made it through the recession in the 80's? How did they do it? That's my answer. What was the question?
Look for seed prices to go way up too. Farmer's are selling the acres, producing less, making more money on corn for ethenol. Anyone else know more on this?

[Marcos]

Look for seed prices to go way up too. Farmer's are selling the acres, producing less, making more money on corn for ethenol. Anyone else know more on this?

The seed 'breadbasket' of this country is Washington state and Oregon, spilling a little into the states surrounding them, and Canada.

There's not a lot of reason to switch this land, in this type of climate, over to corn, as it traditionally is too wet, and the climate is too cool for that crop to flourish consistantly.

Other states in which relatively smaller amounts of turf grass seed are produced could indeed see some switchover to corn for ethanol production.
These include many of the states in the central plains along the Mississippi River basin.

[rcreech]

Harley D,

When you say seed prices are going up what kind of seed are you talking about about?

What does farming and ethanol have to do with seed production?

We use mostly TTTF, PR and KYB and the prices are not going up in our neck of the woods!

I have asked my Lesco rep several times and he told me to just hold tight as the prices should remain the same. I usually try to buy my seed this time of year to get some discounts...but with their new program it isn't as advantagous!

I used about 12,000 lbs this year so seed cost is a big deal to me! Please let me know what you have heard so I can confirm with my guy!

Thanks!
RC

[MStine315]

The seed 'breadbasket' of this country is Washington state and Oregon, spilling a little into the states surrounding them, and Canada.

There's not a lot of reason to switch this land, in this type of climate, over to corn, as it traditionally is too wet, and the climate is too cool for that crop to flourish consistantly.

Other states in which relatively smaller amounts of turf grass seed are produced could indeed see some switchover to corn for ethanol production.
These include many of the states in the central plains along the Mississippi River basin.

If anything, seed ground is going into wheat production, not corn. The price of wheat is up, for one, and environmental pressures on grass seed producers are discouraging them. They used to burn the grass stubble to get rid of weed seeds, esp. poa, but burning has been greatly regulated/restricted and hence the change over to cash crops.

[Hogjaw]

The increase of fertilizer is directly related to the sky rocketing and volatile price of oil and gas production.

Past spring urea was $550.00 a ton. Ammonia sulfate was $385.........however, we finished out the season at $285.00. Lowe's 13-13-13 stayed constant at $6.58 per 40 lb bag.

Fert market is very volatile.......we don't quote fert prices for following year or in the spring.......customer pays market value............plus........our mark-up which is proprietary. I don't have a customer who relishes the thought of pushing 80# during the spring, fall,......but especially when it 95 degrees and 70+% humidity.

I hope you are well ahead by buying or booking in advance.....it's risky either way...however, that's part of business.

Our supplier will let us prepay on today's price and hold in their house until we're ready.

[rcreech]

There are several issues here IMO!

1) I would never use a store grade fert on my customers, especially Triple 13.

2) PERCEPTION is #1! If my customers see me using a Triple 13 then I am not using any better product then they would be! And they are paying me good money to take care of thier lawn. Plus the Triple products have not SCU, usually VERY DUSTY and only ag grade fert with a very poor particle size distribution which doesn't give a very good spread pattern!

3) When you buy urea or a well balanced lawn fert you really only need the N and maybe a sniff of P and K (unless a soil test says differently).

Here you are going to be applying way too much P and K if you are applying the correct amount of N.

If you applied 1# of N...your fert cost was probably a lot higher then if you would have used urea or a balanced fert.

I look at the cost per unit of N and not the cost/bag. That is the only way you can compare prices when shopping for fert!

What rate did you use per K?

Also you state $6.58/bag...but our local Lowes carries Triple 13, but they are 40# bags so keep that in mind when looking at the "cost/bag" theory!

You are just paying for filler when you use a Triple product and it takes too much product! Higher the N the less bags to handle!

Sorry to be critical here.....but I think you steped over a dollar to pick up a dime, unless I am missing something here!

[MStine315]

Dead on, creech. Started to right a disertation, but would've just repeated everything you said, esp. about cost per 1,000. Only thing I can add is the salt content in the ag grade ferts. is way high, too. Quick math with those numbers shows me 13-13-13 would cost about 30% more than Lesco's plain jane slow release.

[Hogjaw]

Post says $6.58 per 40 lb bag

[rcreech]

Post says $6.58 per 40 lb bag


Oppps! Sorry about that!

Didn't see you stated the bag size!

I had a guy challenge me on my starter cost this year as he was looking at Triple 12 at Lowes....but when it all shaked out my PROFESSIONAL STARTER 18-24-12 (25%SCU) was about the same price because mine was a 50# bag and the Triple 12 was a 40# bag.

What rate did you apply?

[Hogjaw]

It's always interesting to see who is laying on the tree limbs waiting to pounce with criticism.

My initial post was to show yes fert prices are volatile even in our area just as well. The previous year it was even worse.

Didn't say I USED the fert.

I don't think we need to read in to the threads what we want to see, but actually read them for what they say.

Still, there are a lot of great threads started and posts to follow that are beneficial.

Most times, dissertations can be passed on.

Thanks all.

Happy Thanksgiving. Remember, tomorrow may be work day again.

[MStine315]

No personal attack intended, just piling on, lol. Happy Thanksgiving.

[Pilgrims' Pride]

Urea cost me $610.00 a ton yesterday.

I asked if they could forcast a price for next year.
All the man could do was point at the heavens and tell me prices will be up again.

In fact he doesnt even know his price until the morning he gets his shipments.

Hold on to yours. feels like we are in for a ride.

The only good thing I guess is that lots of those guys who have been giving themselves away will finally surrender.

Happy Holidays all,

BB

[Pilgrims' Pride]

did you get my pm?

[rcreech]

It's always interesting to see who is laying on the tree limbs waiting to pounce with criticism.

My initial post was to show yes fert prices are volatile even in our area just as well. The previous year it was even worse.

Didn't say I USED the fert.

I don't think we need to read in to the threads what we want to see, but actually read them for what they say.

Still, there are a lot of great threads started and posts to follow that are beneficial.

Most times, dissertations can be passed on.

Thanks all.

Happy Thanksgiving. Remember, tomorrow may be work day again.


Hogjaw,

I hate it that you think people are "waiting in the bushes" to pounce you!

I think this site is excellent also, and I get a ton of great feedback on here.

I don't think I read into anything...as I read it for exactly what you stated.
The way you stated your post....you sure made it sound like you switched over to Triple 13 to finish out your season. Why did you even bring up Lowes and the price then if you didn't use it?

If you didn't use it then don't worry about it...but everything I stated was the facts...so sorry I offended you!

[rcreech]

did you get my pm?

I sure did! I ended up getting so many PM's that I just ended up posting under the post card thread with all the info so I didn't have to keep retyping. If you need any additional info let me know.

Good Luck!

[Marcos]

Hogjaw,

Why did you even bring up Lowes and the price then if you didn't use it?



Retailers like Lowes will get the price that retailers can get from the average 'shelf shopper'.
That 'shelf price', as I'm sure you all know, is pretty much 'set' for the one or two bag homeowners, but somewhat negotiable and flexible for the landscapers buying in quantity at the 'contractor's checkout'.
But by no means can you say the fertilizer price fluctuation at Lowes is any reliable barometer of what's happening on the market!

[americanlawn]

Oh man, creech...........I never knew there was a post card thread. So to save time.....hope you are enjoying your Thanksgiving weekend:usflag:

cuz you're a good dude. Thanks for your posts, help, etc, Your friend, L.:waving:

I sure did! I ended up getting so many PM's that I just ended up posting under the post card thread with all the info so I didn't have to keep retyping. If you need any additional info let me know.

Good Luck!

[MnLefty]

The only good thing I guess is that lots of those guys who have been giving themselves away will finally surrender.



BB

Bingo!! This will hold true for LCO's and suppliers alike. Those that have proven the value of their service to their customers will survive price increases by passing some/most/all of it along to their end user. Those that have continually cut their profit margin to sell/keep selling their service as the cheapest are going to be hit the hardest.

[whoopassonthebluegrass]

Those that have continually cut their profit margin to sell/keep selling their service as the cheapest are going to be hit the hardest.

I just found out that my biggest competitor here had to hire some outside firm to keep him from going under!!!

I feel bad for the guy on a personal level... but you reap what you sow!! He's been hogging the market for some time, still treating lawns at $30-$35 and offering "buy 4 get one free" (which makes those treatments $24-$28)...

Like I said, feel bad for the guy, but glad to see stupidity kicking his butt. He just drags the whole industry down with such poor practices.

[YardPro]

market fluctuations like this will weed out those with weak businesses, and weak business skills.

I think it is better for all of us when things like this happen.

[Hissing Cobra]

I also work for Lesco/JDL and am a bit worried about the price increases myself. Do we at the stores raise the prices? NO! They are passed down through Corporate because they get whacked at the source. That is part of working for a living and continuing to make money/stay in business, and it must be done this way, whether we like it or not. It has NOTHING to do with year end bonuses despite what some of you may think. The basic principles of business are this: If something costs you more money, then it has to cost your customer's more money. Of course, there's a fine line that you have to use in how much and when to raise prices. Some of you may not raise them (if your business is healthy, thriving and you're already charging fair pricing) and some of you will have to.

Those of you who make a nice profit for each application and keep your overhead low, you will not be affected as much, but for those of you who are spending your money recklessly and living the lavish lifestyle, while your business is barely afloat, you'll be in trouble.

Right now, NOTHING is cheap. Whether it's fertilizer prices, gas, oil, food, whatever. We are living in a Black zone, where everything is on the rise. Do I like it? Absolutely not!

With all of this being said, go and TALK to your LESCO/JDL representatives. Ask about their early order programs and terms that are available. These may be what is needed to help you all save some money.

[rcreech]

I also work for Lesco/JDL and am a bit worried about the price increases myself. Do we at the stores raise the prices? NO! They are passed down through Corporate because they get whacked at the source. That is part of working for a living and continuing to make money/stay in business, and it must be done this way, whether we like it or not. It has NOTHING to do with year end bonuses despite what some of you may think. The basic principles of business are this: If something costs you more money, then it has to cost your customer's more money. Of course, there's a fine line that you have to use in how much and when to raise prices. Some of you may not raise them (if your business is healthy, thriving and you're already charging fair pricing) and some of you will have to.

Those of you who make a nice profit for each application and keep your overhead low, you will not be affected as much, but for those of you who are spending your money recklessly and living the lavish lifestyle, while your business is barely afloat, you'll be in trouble.

Right now, NOTHING is cheap. Whether it's fertilizer prices, gas, oil, food, whatever. We are living in a Black zone, where everything is on the rise. Do I like it? Absolutely not!

With all of this being said, go and TALK to your LESCO/JDL representatives. Ask about their early order programs and terms that are available. These may be what is needed to help you all save some money.

Hissing Cobra,

You are exactly 100% correct!

It is easier to save money then it is to make money!

Hope people are preparing for what is ahead!

All I can say it STOCK UP on as many supplies as you can afford to! So far, if the prices go up like they say they will I will have saved about $8000 on fertilizer alone. I guarantee the prices will go way past what projections were anyway!

I hope everyone is buying now, even if they have to borrow the money!

[DMSLANDSCAPE]

something is going on and lesco employees are not waiting around.

there has been a mass exit of barn managers from lesco, as they

read the writing on the wall from the deere takeover.

as always, the takeover company says every job is safe, and they start chopping heads,

and most people are figuring it out

[Hissing Cobra]

What is going on is this: John Deere bought us out and their Corporate Headquarters are in a completely different state than Lesco's Corporate Headquarters. They CANNOT have TWO corporate headquarters! Those people in LESCO's corporate headquarters in Ohio have been given one year to relocate and accept a new position or to find a new job. Obviously, some people are going to have to either move or move on. Some have moved on and some have not. Yes, this does happen during takeovers. Would your company have TWO headquarters in two different states? Could your companies have TWO of everybody in their respective positions? I think not!
While it is unfortunate that some will lose their jobs, it is vital that the company does not have excesses that it cannot handle. That does happen with any type of merger and cannot be avoided.

People, let's not jump off a cliff here. This thread is about the pricing of our products and it has NOTHING to do with John Deere taking over LESCO! All of our competitor's are going to be moving up their pricing too. Is that a result of John Deere's purchase of LESCO? NO!

Some of you won't believe anything that I'm typing and that's your choice. All I can say is this: If you're happy with your LESCO dealer and the employees that you're dealing with, please continue to do business with them. We're honest guys in the Service Centers and we'll work with you as much as we can.

[DMSLANDSCAPE]

if you worked for lesco, you will be quickly expendable, and should know it.
it is true of all takeovers. Deere is a political company, and is aligned with the wars for Bush and Israel. It is easy money for Deere, Catapillar tractor, Bechtel, Halliburton, etc.

most than 40 percent of lesco employees will be gone by next year.

i still buy from lesco, although it is not a major vendor to me. it is more like a convenience store for me, as their fert prices are about 20 percent higher.

lesco must satisfy stockholders, and it was their failing. once a company sells itself to the public, that company dies. it is nature's law

[Hissing Cobra]

O.K. I see the sky is falling in your neck of the woods. LOL!

Under your theories, close to half of LESCO's 340+ stores will be closing up, as 40% of the employees will be gone Correct? I don't think so. John Deere did not buy LESCO in order to close up their stores. What kind of business practice would that be and who would do that? Would you buy another company and get rid of the customer's that you just bought? I think not!

Yes, some of the LESCO stores that may be close enough to exisiting John Deere Landscapes stores, will merge with them but for those that are in their own area and are doing well, it only makes sense for them to remain open. In some instances, there's a LESCO store and a John Deere store in the same industrial park and it makes no business sense whatsoever to keep them both open and in competition with each other. Again, you cannot have two of something, Right?

As of right now, there's been turnover at the CORPORATE level because of the presence of TWO Corporate Headquarters. IF there's been any turnover at the LESCO/JDL stores, it's because of the individual's choice to move on.

There's a lot of people out there spewing negativity on this buyout and the majority of them don't even know what they're talking about. Again, let's get this topic back on track, as the pricing increase has NOTHING to do with JDL's buyout of LESCO. ALL Fertilizer vendors will be raising their prices and it's only a matter of time until it'll be seen.

[bug-guy]

i'm at 770 in brooksville fla. fairly new store as you can tell by my #. right now the is no jdl near me and i have a big yard and plans to expand to some blue(irrigation) products. i'm looking foward and optimistic

[Hissing Cobra]

i'm at 770 in brooksville fla. fairly new store as you can tell by my #. right now the is no jdl near me and i have a big yard and plans to expand to some blue(irrigation) products. i'm looking foward and optimistic

Good to know that I'm not the only one here. I also like your attitude! I'm optimistic myself and I'm not giving into the "panic" that some people have taken on. If I do, I'll be doomed to faill. Our store is also looking forward to begin to carry the irrigation products and we're in training now to bring ourselves up to snuff when it comes to ordering supplies, placing orders and making sales. It's another avenue in which we can help our customers.

[DUSTYCEDAR]

time will tell and as for price increases its all over so making a deal with who u buy from will be key

[Marcos]

Again, let's get this topic back on track,

Cobra,
It may be easy for you, as an employee of the company that has been eaten by a Deere, to want to avoid the realistic (yet painful) observations concerning the public's perception of the buyout's ramifications to them.

It's pretty easy to see you'd probably tow any company line that was thrown your way, even as the ship(s) you're on may very well be sinking.

I say let this thread take any direction it naturally wants to take!

[Hissing Cobra]

Cobra,
It may be easy for you, as an employee of the company that has been eaten by a Deere, to want to avoid the realistic (yet painful) observations concerning the public's perception of the buyout's ramifications to them.

It's pretty easy to see you'd probably tow any company line that was thrown your way, even as the ship(s) you're on may very well be sinking.

I say let this thread take any direction it naturally wants to take!

Marcos,

You couldn't be more wrong. I've already been through a buyout with my previous employer and let me tell you, THAT was a painful procedure. Therefore, I won't "tow any company line that is thrown my way".

The public is going to perceive whatever they want to but the fact is this: Prices of Urea have skyrocketed and LESCO/JDL is NOT the only vendor that is going up on their prices. Keep your eyes open, you'll soon find out that what I'm saying is the truth.

[bug-guy]

Marcos,

You couldn't be more wrong. I've already been through a buyout with my previous employer and let me tell you, THAT was a painful procedure. Therefore, I won't "tow any company line that is thrown my way".

The public is going to perceive whatever they want to but the fact is this: Prices of Urea have skyrocketed and LESCO/JDL is NOT the only vendor that is going up on their prices. Keep your eyes open, you'll soon find out that what I'm saying is the truth.

i also worked for a company involved in a buy out (20 + yrs) talk about painful... at least jdl has been fair most people are opposed to change just from a comfort level.
and from want i heard it's going to effect N.P.and K.
urea should that it the worst. so programs using 0-0-62 or 0-0-50 should feel it aswell as some less expesive blend w/a.s.

[Marcos]

Marcos,

You couldn't be more wrong. I've already been through a buyout with my previous employer and let me tell you, THAT was a painful procedure. Therefore, I won't "tow any company line that is thrown my way".

The public is going to perceive whatever they want to but the fact is this: Prices of Urea have skyrocketed and LESCO/JDL is NOT the only vendor that is going up on their prices. Keep your eyes open, you'll soon find out that what I'm saying is the truth.

Oh...There's no question that the market's changing. From natural gas prices to the cost of hauling stuff to the up-and-coming foreign competitors now being more keen in the market.......etc. etc.

My ultimate point to you and to everyone else on this thread is that John Deere has a lot to prove to the Lesco customers if they want to gain their trust, largely in light of their well-known history (and well discussed on this web site) of screening their customers first!.

That way of doing business alone has been Deere's most twisted Achille's heel for years!

This, combined with the unfortunate current situation in the world urea market, puts them in a very unenviable position, and a very easy target for competitors anxious to take advantage of the Lesco takeover while it's still fresh, and the negative fallout still occurring.

[ampeg76]

a bag of 20-0-20 6.5% Fe with .93 atrazine cost the company i work for $18.90 last year, its been hiked up to $23.50 a bag now, ouch!

[Hissing Cobra]

a bag of 20-0-20 6.5% Fe with .93 atrazine cost the company i work for $18.90 last year, its been hiked up to $23.50 a bag now, ouch!


It doesn't surprise me. Was this through LESCO/JDL or a competitor?

[Jimmie]

Is that price from JD/lesco?

[Hogjaw]

Interesting Post And Threads!

[Hissing Cobra]

Oh...There's no question that the market's changing. From natural gas prices to the cost of hauling stuff to the up-and-coming foreign competitors now being more keen in the market.......etc. etc.

How true. I think that you'll agree that if the price of Natural Gas goes up, then the price of Fertilizer will go up too. Correct? After all, they both use UREA to be produced and last year's pricing of $330 per ton has now skyrocketed to over $460 per ton. Again, rising prices that are NOT tied to the JDL/LESCO buyout.

My ultimate point to you and to everyone else on this thread is that John Deere has a lot to prove to the Lesco customers if they want to gain their trust, largely in light of their well-known history (and well discussed on this web site) of screening their customers first!.

That way of doing business alone has been Deere's most twisted Achille's heel for years!

Do you have any proof to back this up? I'm curious as to how you came up with this statement.

This, combined with the unfortunate current situation in the world urea market, puts them in a very unenviable position, and a very easy target for competitors anxious to take advantage of the Lesco takeover while it's still fresh, and the negative fallout still occurring.

We have over 340 stores nationwide and as long as we continue to be fair to our customers and provide excellent customer service, we'll CONTINUE to be a MAJOR player in this market. I can assure you that we will be doing what we need to do to keep our customers coming back to us. Pricing increases are understandably NOT popular, but they do happen. It's all part of running a SUCCESSFUL business, whether you're the manufacturer of the product, the seller of the product, or the applicator of the product.

[robertsturf]

I went to our local JD store today and my quoted price for fertilizer had gone up $7.00 per bag. How in the heck are we supposed to stay in business at these ridiculous prices? I was told they are going up again after Jan 1. The guys at the store said JD wants their prices up higher for bigger profits!! What gives. They said the first price increase WAS tied to the take-over!! Price increases are one thing this is price gouging!!!!

[ampeg76]

It doesn't surprise me. Was this through LESCO/JDL or a competitor?

to you and jimmy, it was lesco:(


i have talked with other lco's in the area that buy lesco products, they have seen $4 to $6 more per bag!

my prices did not go up that much at all through helena, so it makes you wonder

[rcreech]

Hissing Cobra,

You sound like a good fella....and I wish you the best of luck!
I have a great Lesco rep and he treats me great!
Lesco is no always the cheapest...but my rep has always taken care of me and I trust him.
All my prices this season were right in line with the competition and Lesco even beat them on most things.

Keep up the good work!

[rcreech]

I went to our local JD store today and my quoted price for fertilizer had gone up $7.00 per bag. How in the heck are we supposed to stay in business at these ridiculous prices? I was told they are going up again after Jan 1. The guys at the store said JD wants their prices up higher for bigger profits!! What gives. They said the first price increase WAS tied to the take-over!! Price increases are one thing this is price gouging!!!!


robertsturf,

What analysis are you using that went up $7.00/bag?

I hate that for you! Almost everyone that I talked to knew the prices were going up at Lesco on Nov 26th at Lesco JDL.

Do you not talk to your Lesco rep much? I talk to mine several times a week and keep a good communication.

If the JDL man told you they are raising their prices for a bigger profit then he is an idiot! Why would anyone admit that!

Again, due to the fert market....everyone should have locked in a price before this raise. Yes there are some out there that can keep thier price until Dec or Jan...but they will be right there with Lesco when it is all said and done!

[Jimmie]

Lesco has always been a great place, Reps are great, Really I'm willing to pay a little more at Lesco they have been great to deal with. if everyone follows with this big of a increase no problem I'll still buy at Lesco. I do not buy as much as allot of you because
fertilizer is a small part of my business. But I want a fair price, but they do not have to be the cheapest.

[robertsturf]

rcreech,
I was purchasing 32-3-8 SCU. It went from 11.95 per bag to 18.03 per bag. I did have the price locked in!! JD will not let them honor the price they quote me. They price everything at corp. level!!

[Marcos]

[QUOTE=Hissing Cobra;2046645]
Do you have any proof to back this up? I'm curious as to how you came up with this statement.

Are you KIDDING?

Just type in 'deere' under the 'search' button near the top of your screen!
And look at some previous blogs from around the country!

Here's one from:Jason Rose 10/30/07 10:12 pm

yes, all lescos... I guess we are somewhat fortunate, the Lesco I go to (in Wichita KS) is only a few blocks from the JDL. However Iv'e never even been too JDL because they are soooo picky about who shops there. I received their "packet" to fill out to get an account there and felt like I needed a specimen cup to send along as well! Iv'e been in business for about 12 years and I didn't have all the things they "required" me to have in order to purchace from them. Plus, their prices were WAY HIGH on fert. and combo products so I never even bothered with any of it.


This same attitude is reciprocated very accurately at the Deere that's close to where I am, in northern Cincinnati.
I and others in this area have come to the conclusion that the Deere mentality is that they're absolutely the 'creme de la creme' of the suppliers out there, and that they have the right to pick and choose who they want to work with!
And to beat all, they were this way BEFORE the Lesco buyout!

Cobra, Why do you think that attitude would change any if at all after?
QUOTE]

[LawnTamer]

[QUOTE=Hissing Cobra;2046645]
Do you have any proof to back this up? I'm curious as to how you came up with this statement.

Are you KIDDING?

Just type in 'deere' under the 'search' button near the top of your screen!
And look at some previous blogs from around the country!

Here's one from:Jason Rose 10/30/07 10:12 pm

yes, all lescos... I guess we are somewhat fortunate, the Lesco I go to (in Wichita KS) is only a few blocks from the JDL. However Iv'e never even been too JDL because they are soooo picky about who shops there. I received their "packet" to fill out to get an account there and felt like I needed a specimen cup to send along as well! Iv'e been in business for about 12 years and I didn't have all the things they "required" me to have in order to purchace from them. Plus, their prices were WAY HIGH on fert. and combo products so I never even bothered with any of it.


This same attitude is reciprocated very accurately at the Deere that's close to where I am, in northern Cincinnati.
I and others in this area have come to the conclusion that the Deere mentality is that they're absolutely the 'creme de la creme' of the suppliers out there, and that they have the right to pick and choose who they want to work with!
And to beat all, they were this way BEFORE the Lesco buyout!

Cobra, Why do you think that attitude would change any if at all after?
QUOTE]

Sorry Cobra, but that was my experience with JD landscapes too. There was one just a few miles from my home, so I stopped by one day to see what all they carried and what their prices were like.
Now I'm not a huge buyer, but I spend $20-25K/yr at Lesco. Anyway, I got such a run-around at JD landscapes, basically in order to "qualify" to get their commercial rate, they wanted me to switch my cell phone plan, and a bunch of other crap, it was crazy.
When I crunched the #s it just didn't add up. Even if I switched to their cell provider and their other service providers and spent my $25k, I would still end up paying more for product.
If JD starts pulling crap like that with Lesco, I'll just go back to using Ag. suppliers. I sure hope they don't though, I like my Lesco reps and I like the convenience.

[bug-guy]

i think some people might be mixing up credit apps w/shopping. i believe jdl does their own financing so they may ask for alot of info so do others credit companies. as far as all the other services it is called the partners program.
it is not for all not even offered to all but can bring some savings and incentives. example if you shop w/jdl (lesco) now and use nextel on this program you can save i think 15 % but you have to talk to deere direct not nextel. there are other examlpes which i am still trying to grab... there also a incentive given to the customer at the end of the year depending on some qualifiers i deal with some companies that did work w/ both jdl and lesco and once they realized their purchases from lesco counts on their partners program have increased their business with us
i really am not do this program justice it's still new to me also
but these $ increases are killing me also... there 's alot more to the job than standing behind the counter.
some of the prices that were programed for the customers the last month can't be honored always because once you account for shipping their below cost now
remember if you sell somthing for 30.00 and it cost you 24. 00 after everything. than your cost goes up to 28.00 you have to raise the price 4.00 just to stay the same
in some cases w/me i also take a hit and absorb some cost
all i can say is be Patient and fair w/your lesco rep
today i will working w/ 4-5 of my reg cust trying to find some middle ground as well as my reg tasks
it's not easy for anyone but smarter and cooler people will prevail

if anyone wants more info on the partners program pm me and i will get you a number to call

[patterson]

Let's start with things everyone knows. John Deere sucks and has since the 1950"s.
My price for a bag of 35-3-5 went from 12.60 to 21.20 in one month. You can walk into home depot and buy lesco fert for 20 a bag.

John Deere landscapes is clueless. they sell plants and shovels and crappy overpriced mowers. Yes, you can mark those up a lot. You can't expect the same margin on a bag of fert.

I have no doubt they'll wake up after those of us buying a ton or two a month go elsewhere. The prices will come back down. I won't care and I won't return. After twelve years with Lesco at 35-40K per year, these bean counters come in at the end of the year when no one has time to shop, and flat out gouge everybody. That's how it appears they will do business. That's fine. I've already told my good friends at Lesco who I've known and liked for a decade, that when my price gets down to five bucks a bag call me. Until then, I have no use for John Deere. They will continue on until they price everyone, including the end consumer, out of the market, then they will scratch their heads and wonder what happened while they sell million dollar combines to the Chinese.

[Mscotrid]

rcreech,
I was purchasing 32-3-8 SCU. It went from 11.95 per bag to 18.03 per bag. I did have the price locked in!! JD will not let them honor the price they quote me. They price everything at corp. level!!


I think you would be suprised on how many price increases your vendor wheter it be Lesco, Helena, UAP or whoever has absorbed over the last 2 years. Your gas price has almost double, milk prices are up almost a third.

I'll bet the fert price plus freight to get to there location net about 10-15% whee it's all said and done at $11.95. I don't know about you but I make more than 10-15% on my efforts. Instead of being pissed off at every vendor, I'd wonder why I havn't raised prices to my customers over the years to pace cost. I'd also thank my vendors for keeping prices in line for as long as they have. I guess they colud have produced 45lb bags and kept the price the same. Food manufactures do it all the time. My experience from attending trade shows or being at a supllier when my competition is there is many have no idea what "cost per thousand is." I've heard competitors say "Whats my bag price" or "I just spread a bag on the yard." I actually saw a lawn care owner accuse a vendor and get mad because he was trying to explain bag vs coverage pricing and this guy said "thats all paper junk what are you going to charge me my guys will just dump a bag on the lawn." I believe calibration wasn't in his vocabulary. Whats the better buy 32-3-8 @t 11.95 or 46-0-0 @ $16.25.

I'll be looking at my program next year and adjust if necessary without sacrficing credibility with clients. My lawns will continue to look good and I'll continue to make money.

[ampeg76]

went and bought some 5-10-31, 10% FE(yep i know, MOP, salt city), for my boss, went from $13.45 a bag to $17.05, ouch

[jrc lawncare]

Let's start with things everyone knows. John Deere sucks and has since the 1950"s.
My price for a bag of 35-3-5 went from 12.60 to 21.20 in one month. You can walk into home depot and buy lesco fert for 20 a bag.

John Deere landscapes is clueless. they sell plants and shovels and crappy overpriced mowers. Yes, you can mark those up a lot. You can't expect the same margin on a bag of fert.

I have no doubt they'll wake up after those of us buying a ton or two a month go elsewhere. The prices will come back down. I won't care and I won't return. After twelve years with Lesco at 35-40K per year, these bean counters come in at the end of the year when no one has time to shop, and flat out gouge everybody. That's how it appears they will do business. That's fine. I've already told my good friends at Lesco who I've known and liked for a decade, that when my price gets down to five bucks a bag call me. Until then, I have no use for John Deere. They will continue on until they price everyone, including the end consumer, out of the market, then they will scratch their heads and wonder what happened while they sell million dollar combines to the Chinese. Exactly why I buy with a distributer that sells Lebanon turf products.:)

[rcreech]

rcreech,
I was purchasing 32-3-8 SCU. It went from 11.95 per bag to 18.03 per bag. I did have the price locked in!! JD will not let them honor the price they quote me. They price everything at corp. level!!

That is a serious price up! I wasn't aware of 32-3-8 going up that much (33%).

When you say you had your price "locked in" did you have it purchased?

That is the only way you can lock a price in today at Lesco.

My Lesco rep called me about two weeks ago and told me about the next two price increases. He told me that if I didn't have my order it by midnight on 11-26-07 that it was fair game on price.

I ended up ordering about 1.5 times what I needed for next year to allow for growth due to the price increases.

Maybe you need to stay in better contact with your Lesco rep?

Have you checked anyone else's prices to see if they went up also?

[ScottC]

My price for a bag of 35-3-5 went from 12.60 to 21.20 in one month.

I am new to this forum and found it by searching for JD/Lesco price increases.

I have been in the business for 19 years and have been a loyal Lesco customer for 17 of those 19 years. The local manager has become a very good friend of mine & I go out of my way to shop his store when there is another JD/Lesco store closer to my office.

However, these recent price increases are getting out of control. Until recently I bought into the argument the raw materials and cost of production/delivery were the sole reason for the increases. Based on the following I am convinced they are as much or more related to profit.

I use the Lesco HD spreader. About 2 years ago while having it serviced, the mechanic told me that if I ever had a major engine problem not to repair but replace as a complete brand new engine could be purchased through Lesco for $305.00. I confirmed that price at that time and again in January of this year, well after the acquisition by John Deere. Getting ready to now replace that engine I began shopping on the Internet and today can purchase that engine from $285.00 to $325.00 with many vendors offering no shipping and no sales tax.

Just for the heck of it I asked my local manager to get me a price. I was shocked that the same engine from Lesco at $305.00 and readily available on the Internet for similar pricing is now $685.00 from John Deere/Lesco. So that begs the question, how can John Deere justify a 225% increase in a product that is proven not to have increased in price from their supplier? In fact, I'll bet that John Deere can buy that engine for less than Lesco did.

Yesterday I was at the service center to make a purchase. While standing outside waiting on the fertilizer to be brought out, I began chatting with the driver from the Sebring, FL plant making a fertilizer delivery. I jokingly said to him that their price increases were killing us. He replied in a very serious tone that the price increases were coming from John Deere and not his company. He said he has recently been hearing complaints like this from others in the industry and he knows for a fact there are increases from John Deere on products that are being manufactured/delivered to them without an increase. And another increase is coming on 07-01 amounting to as much as $2.00 per bag.

In the past I have been able to keep Lesco in check with quotes from competitors on chemicals but have always used Lesco granular products exclusively. Loyalty and friendship can only go so far. I will be contacting other suppliers next week for competitive pricing on my granular products.

My personal opinion is that if this does not change John Deere will succeed in taking a great company and running it into the ground.

[bug-guy]

Yesterday I was at the service center to make a purchase. While standing outside waiting on the fertilizer to be brought out, I began chatting with the driver from the Sebring, FL plant making a fertilizer delivery. I jokingly said to him that their price increases were killing us. He replied in a very serious tone that the price increases were coming from John Deere and not his company. He said he has recently been hearing complaints like this from others in the industry and he knows for a fact there are increases from John Deere on products that are being manufactured/delivered to them without an increase. And another increase is coming on 07-01 amounting to as much as $2.00 per bag.

In the past I have been able to keep Lesco in check with quotes from competitors on chemicals but have always used Lesco granular products exclusively. Loyalty and friendship can only go so far. I will be contacting other suppliers next week for competitive pricing on my granular products.

My personal opinion is that if this does not change John Deere will succeed in taking a great company and running it into the ground.


scott
first off sebring does not have any company drivers. a company named cardinal does most of the del. and local independants handle the over flow.
the cardinal guy's have no clue to T.C.S or JDL inner operations.
as far as the july 1st increase hold on to you hats. i have seen the master list of increases from TCS and it showed not only JDL increases but all the other suppliers as well.
please stop the conspiracy theories.
as far as driving a good company (lesco) down ... they were doing that by themselves... they were not making any decent money for their shareholders.
i'm sure most companies on this site do not do work for cost why would jdl.

we are all entitled to our own opinions
and they should be based on experience and knowledge
some here are too emotional or have hidden agenda's
that's the double edged sword of the internet
you can't see or be seen by others

i will post an article about cost increases as soon as i scan it

ps scott i am in your area

[whoopassonthebluegrass]

Just for the heck of it I asked my local manager to get me a price. I was shocked that the same engine from Lesco at $305.00 and readily available on the Internet for similar pricing is now $685.00 from John Deere/Lesco. So that begs the question, how can John Deere justify a 225% increase in a product that is proven not to have increased in price from their supplier? In fact, I'll bet that John Deere can buy that engine for less than Lesco did.

I've dealt with a similar problem with mowers. After thinking about it, I could see the logic of it. I still don't agree with it, but I CAN see the logic: If you would normally make $40 on that $305 motor, why not make $420?? Sure, you won't sell as many, but you only need to sell 1/9 of what you were to make the same friggin' profit! Less warehousing, less capital out the window, etc...

I think it's stupid, but there's logic behind it. It's likely going to do irreparable damage to them, but that's THEIR call.

I quit using them entirely. I ordered parts 3 months ago and they still don't have them. I asked about fertilizer and insecticide... all out of stock with no idea when they'd have more... what a joke...

[bug-guy]

http://www.growertalks.com/archive/articles/2636.asp

New Volatility in Fertilizer Costs :: by Lynn P. Griffith


Published:6/1/2008

What's causing the surge in pesticide and fertilizer prices?


Soluble 20-20-20 has gone from about $13.00 a bag to around $25.00 a bag. The price of Roundup doubled in a 30-day period. Potassium nitrate has gone from $11.00 to $18.00 to $24.00 to $28.00 to $35.00, just in the last eight months. I've been told that if I wanted to buy a truckload of potassium nitrate right now, I couldn't do so at any price. Growers think their fertilizer suppliers are employing predatory pricing in a time where growers aren't really in a position to raise their prices.

I haven’t seen this kind of gyration in price and availability of grower staples in my 32-year career. What the heck is going on? There are a number of things happening. One is that developing countries are expanding their agricultural production and, therefore, their fertilizer usage. There are three main suppliers of potash in the world and two major suppliers of phosphate. Prices of these commodities are based on supply and demand, and since demand is way up, the suppliers are selling bulk raw materials pretty much to whom they choose. Many fertilizer manufacturers who had contracts for potash have been told they now only get an allotment of what they contracted for, and often that allotment comes rather slowly. Producers in certain parts of the world are willing to pay higher prices for raw materials than we've traditionally seen in the U.S.
There aren’t exactly shortages of phosphate and potash, but the situation seems analogous to the price of oil. We have plenty of oil, but because of high demand and limited production, the price has skyrocketed. Fertilizer is the same way. Sulfur-coated urea-based fertilizers were running $18.00 to $19.00 per bag, and now they're in the mid $30s. The price of phosphorous acid has risen $1,000.00 a ton, and therefore Roundup and Aliette have shown huge price increases. Prices of phosphate and potash go up almost every week, sometimes every three days. Atrazine and other common pesticides and herbicides have gone way up as well, depending on what raw materials are used in their manufacturing. China is buying up large quantities of potash, and Russia recently privatized their vast potash resources. Whether they'll sell any to us remains to be seen. Many specialty products are made from muriate of potash. Sulfur has gone up even more than nitrogen. Today it's very hard to get Epsom salts, EMJEO or kieserite, all important magnesium sources. In micronutrients, copper and zinc have gone way up due to industrial usage of the metals in electronics and other industries. Zinc has stabilized, but copper is still rising. A lot of manganese comes out of China, and China has instituted a 135% agricultural export tax, which is just now coming into effect. There have also been production problems in Mexico.

What does this mean to the grower of petunias in Peoria? No. 1, things may get worse before they get better in terms of fertilizer price and availability. Add to this the cost of plastics and media, and everybody is getting squeezed. The weaker growers may get hurt quite a bit and BMPs for some types of production could go out the window. Some producers are keeping potassium nitrate out of turf and landscape fertilizers and are saving the nitrates more for vegetable and greenhouse use. Eggs have gone up 69.2% in the last two years and flour is up 48%. The price of a finished plant is going to have to go up soon to maintain any type of profit margin for the grower.
Biofuel production is a factor, but not a driving force. The cost of oil and the weak dollar are a factor here, but they mostly affect the finished fertilizer blender. Raw fertilizer materials are primarily sent by ship, barge and rail, but the fertilizer suppliers that you buy from are being forced to blend more costly and less plentiful ingredients, and they then have to ship to their distributors and ultimately to your greenhouse, burning diesel fuel that's well over a dollar a quart. Oil is expensive partly because the dollar is weak. The weak dollar also affects your cost of imported fertilizer ingredients.

What's going to happen? Things may ease up after the spring planting season, when prices are expected to stabilize. They may increase again in the fall when Brazilian, Australian and Chilean planting kicks in.

What should you do to make it through these difficult and unpredictable times? Watch your costs, as always. If you don’t need copper or manganese in that fertilizer blend, don’t include it. Monitor your fertility carefully. Houses aren’t selling and new construction is down, which is hurting sales of some items. Food and fuel are way up, and inflation is probably greater than the government is telling us it is. Keep an eye on your open accounts, as payments to you may be slowed from struggling customers. Finally, someone is going to have to convince the box stores that plant prices will need to go up.

Lynn Griffith is president of A & L Laboratories, Pompano Beach, Florida, and author of Tropical Foliage Disorders and Tropical Foliage Plants, 2nd Edition.

[ScottC]

http://www.growertalks.com/archive/articles/2636.asp

New Volatility in Fertilizer Costs :: by Lynn P. Griffith


Published:6/1/2008

What's causing the surge in pesticide and fertilizer prices?


Soluble 20-20-20 has gone from about $13.00 a bag to around $25.00 a bag. The price of Roundup doubled in a 30-day period. Potassium nitrate has gone from $11.00 to $18.00 to $24.00 to $28.00 to $35.00, just in the last eight months. I've been told that if I wanted to buy a truckload of potassium nitrate right now, I couldn't do so at any price. Growers think their fertilizer suppliers are employing predatory pricing in a time where growers aren't really in a position to raise their prices.

I haven’t seen this kind of gyration in price and availability of grower staples in my 32-year career. What the heck is going on? There are a number of things happening. One is that developing countries are expanding their agricultural production and, therefore, their fertilizer usage. There are three main suppliers of potash in the world and two major suppliers of phosphate. Prices of these commodities are based on supply and demand, and since demand is way up, the suppliers are selling bulk raw materials pretty much to whom they choose. Many fertilizer manufacturers who had contracts for potash have been told they now only get an allotment of what they contracted for, and often that allotment comes rather slowly. Producers in certain parts of the world are willing to pay higher prices for raw materials than we've traditionally seen in the U.S.
There aren’t exactly shortages of phosphate and potash, but the situation seems analogous to the price of oil. We have plenty of oil, but because of high demand and limited production, the price has skyrocketed. Fertilizer is the same way. Sulfur-coated urea-based fertilizers were running $18.00 to $19.00 per bag, and now they're in the mid $30s. The price of phosphorous acid has risen $1,000.00 a ton, and therefore Roundup and Aliette have shown huge price increases. Prices of phosphate and potash go up almost every week, sometimes every three days. Atrazine and other common pesticides and herbicides have gone way up as well, depending on what raw materials are used in their manufacturing. China is buying up large quantities of potash, and Russia recently privatized their vast potash resources. Whether they'll sell any to us remains to be seen. Many specialty products are made from muriate of potash. Sulfur has gone up even more than nitrogen. Today it's very hard to get Epsom salts, EMJEO or kieserite, all important magnesium sources. In micronutrients, copper and zinc have gone way up due to industrial usage of the metals in electronics and other industries. Zinc has stabilized, but copper is still rising. A lot of manganese comes out of China, and China has instituted a 135% agricultural export tax, which is just now coming into effect. There have also been production problems in Mexico.

What does this mean to the grower of petunias in Peoria? No. 1, things may get worse before they get better in terms of fertilizer price and availability. Add to this the cost of plastics and media, and everybody is getting squeezed. The weaker growers may get hurt quite a bit and BMPs for some types of production could go out the window. Some producers are keeping potassium nitrate out of turf and landscape fertilizers and are saving the nitrates more for vegetable and greenhouse use. Eggs have gone up 69.2% in the last two years and flour is up 48%. The price of a finished plant is going to have to go up soon to maintain any type of profit margin for the grower.
Biofuel production is a factor, but not a driving force. The cost of oil and the weak dollar are a factor here, but they mostly affect the finished fertilizer blender. Raw fertilizer materials are primarily sent by ship, barge and rail, but the fertilizer suppliers that you buy from are being forced to blend more costly and less plentiful ingredients, and they then have to ship to their distributors and ultimately to your greenhouse, burning diesel fuel that's well over a dollar a quart. Oil is expensive partly because the dollar is weak. The weak dollar also affects your cost of imported fertilizer ingredients.

What's going to happen? Things may ease up after the spring planting season, when prices are expected to stabilize. They may increase again in the fall when Brazilian, Australian and Chilean planting kicks in.

What should you do to make it through these difficult and unpredictable times? Watch your costs, as always. If you don’t need copper or manganese in that fertilizer blend, don’t include it. Monitor your fertility carefully. Houses aren’t selling and new construction is down, which is hurting sales of some items. Food and fuel are way up, and inflation is probably greater than the government is telling us it is. Keep an eye on your open accounts, as payments to you may be slowed from struggling customers. Finally, someone is going to have to convince the box stores that plant prices will need to go up.

Lynn Griffith is president of A & L Laboratories, Pompano Beach, Florida, and author of Tropical Foliage Disorders and Tropical Foliage Plants, 2nd Edition.

Thanks bug-guy for this information. What area are you in?

[bug-guy]

spring hill - brooksville
worked at local company for 21 yrs untill they sold off

[bug-guy]

scott are you with green team

[ScottC]

scott are you with green team

No I am not.

[ScottC]

scott
first off sebring does not have any company drivers. a company named cardinal does most of the del. and local independants handle the over flow.
the cardinal guy's have no clue to T.C.S or JDL inner operations.
as far as the july 1st increase hold on to you hats. i have seen the master list of increases from TCS and it showed not only JDL increases but all the other suppliers as well.
please stop the conspiracy theories.
as far as driving a good company (lesco) down ... they were doing that by themselves... they were not making any decent money for their shareholders.
i'm sure most companies on this site do not do work for cost why would jdl.

we are all entitled to our own opinions
and they should be based on experience and knowledge
some here are too emotional or have hidden agenda's
that's the double edged sword of the internet
you can't see or be seen by others

i will post an article about cost increases as soon as i scan it

ps scott i am in your area

OK, I'll consider your information on the fertilizer issue but how do you explain the engine situation? That's not a conspiracy theory, it's a fact. One has to consider this occurrence when evaluating the other price increases.

[Mscotrid]

Bug Guy, thanks for the informative post. I think we all would be better off if we kept informed on the real issue of price increases than to slam our vendors. I personally have altered my chemical program and have seen fantastic results without scaraficing my customers expectations.

Our concern is not UAP, JDL, Helena or whoever we buy from, but that we adapt and except the fact that our industry and economy is changing and changing rapidly. Fuel, fert and food have all had increases at a time when many of our customers are feeling a pinch. I would suggest you broaden your base of services offered. If you stay constant and ***** about everything you will lose. I do not install irrigation (yet) but I do repair the heads. Nice upsell and great profit margin. I'm currently looking into adding lighting to our offering. How about adding mower repair to your service. Hell we all do our maintenance. Whats so hard about picking up a customers mower and sharpening the blade and replacing a spark plug. Some might see a pain in the a$$, I see $45-60 what the local service shop is going to charge that homeowner. Do that over the winter, lets say you just do 20 cleanup services and have what $60.00 in spark plugs and air filters and produce revenue around $1000.00. Not a bad return in my ledger.

Bottom line is we have to be creative and adapt to get past this crucial and unstable time.

[bug-guy]

first to scott on the engine. i watched a electric hose reel jump several hundred $ after an order was placed(the orginal $ were honored) only to see it come back down to where it should be... i was told computer problems.
you also have to understand some parts are ordered from the same place you can order from, this is where smart shopping comes into play. i always advice my cust. when i think they can do better on their own. engines and pumps come to mind first.

second mscotrid i couldn't agree more.
insanity is doing the same thing over and over again expecting a different result.
i have spoke to several friends and said we will see who the the smart cpo's are.
and how they attack this problem
it might be buying two products and mixing them together instead of already blended (thinking soluble products)
buying gran. ferts that have a mix of N instead of all scu's
i know we are trying to change the way we order
1 pallet of fert might cost 75.00 to ship
while 10 pallets cost 40.00 each to ship
we all have to think out side the box
i ... like all of the rest are not looking forward to july

good luck to all

[ted putnam]

scott
first off sebring does not have any company drivers. a company named cardinal does most of the del. and local independants handle the over flow.
the cardinal guy's have no clue to T.C.S or JDL inner operations.
as far as the july 1st increase hold on to you hats. i have seen the master list of increases from TCS and it showed not only JDL increases but all the other suppliers as well.
please stop the conspiracy theories.
as far as driving a good company (lesco) down ... they were doing that by themselves... they were not making any decent money for their shareholders.
i'm sure most companies on this site do not do work for cost why would jdl.

we are all entitled to our own opinions
and they should be based on experience and knowledge
some here are too emotional or have hidden agenda's
that's the double edged sword of the internet
you can't see or be seen by others

i will post an article about cost increases as soon as i scan it

ps scott i am in your area

AGREED. I don't really know anything about the trucking but what I do know is JDL isn't the only one increasing prices at this time. I keep tabs on suppliers in my vicinity and increases are coming at virtually the same percentages and time frames. No conspiracy from what I've seen in that respect.

[rcreech]

scott
first off sebring does not have any company drivers. a company named cardinal does most of the del. and local independants handle the over flow.
the cardinal guy's have no clue to T.C.S or JDL inner operations.
as far as the july 1st increase hold on to you hats. i have seen the master list of increases from TCS and it showed not only JDL increases but all the other suppliers as well.
please stop the conspiracy theories.
as far as driving a good company (lesco) down ... they were doing that by themselves... they were not making any decent money for their shareholders.
i'm sure most companies on this site do not do work for cost why would jdl.

we are all entitled to our own opinions
and they should be based on experience and knowledge
some here are too emotional or have hidden agenda's
that's the double edged sword of the internet
you can't see or be seen by others

i will post an article about cost increases as soon as i scan it

ps scott i am in your area


Agree totally!

Fert price increase are WORLD WIDE not just JDL!

Just for the fun of it I have called around a few places and I get a much better price at JDL in most cases.

[PSUTURFGEEK]

TCS in Ohio is the one who had the price increase as stated b4, this company which was once owned by lesco a few years ago makes the fert and combo products for many supplyers, the companies who don't buy from them have been doing weekly increases over the past month, Jdl and Uap are just trying to hold off and do it all at once, the cost of a fert you may have been using has gone from lets say 11.00 to 17.00 on average.