urea market price increase

Discussion in 'Pesticide & Herbicide Application' started by heritage, Sep 24, 2004.

  1. heritage

    heritage LawnSite Bronze Member
    Posts: 1,283

    Hello all,
    Well I am pretty upset about the current price change on urea and I would like to know how others here are dealing with the increase. I refuse to cut rates to make up the diff on profit loss so I will have to deal and keep quality high.

    Most of the fert I apply is custom blended based on annual soil tests and Here are some of the products I use as well as the pricing.

    38-0-0 UF $1250 Ton
    46-0-0 Was $300 a Ton In May Currently $480 a Ton ( WOW! )
    18-46-0 $350 a Ton
    Iron Sucrate $400 a Ton
    Pell Gypsum $240 a Ton
    Pell Dolimitic Lime $125 a Ton
    38-0-0 S.C.U. $550 a Ton

    What are some of the prices you folks are currently paying and what do you think the future brings as far as pricing for 2005.

    Ric, Tremor , Timturf , Grassmechanic.........and other experts of the like,
    Please share your thoughts,

    Pete D.
     
  2. Green Dreams

    Green Dreams LawnSite Senior Member
    from Texas
    Posts: 593

    I just paid less than $10 for 50 lbs of 46-0-0 a month ago. Now $15 or $16 per bag...
     
  3. Grassmechanic

    Grassmechanic LawnSite Silver Member
    Posts: 2,697

    Urea runs around $9-11 a bag. Keep in mind that it takes natural gas to process fertilizer. The increases are reflecting the high cost of energy. I look for all ferts to increase next year.
     
  4. Ric

    Ric LawnSite Fanatic
    Posts: 11,957


    I have been so busy with Hurricane clean up I have not stayed up on pricing. We are paying over $ 2.00 on Gasoline and it is all inter related. I see all my cost going up and Know I will need to increase prices very soon.
     
  5. turfsurfer

    turfsurfer LawnSite Senior Member
    Posts: 364

    Aside from the $.15 a bag fuel surcharge, Lesco has kept my prices stable since their beginning of the year price quotes. Seems unreasonable to raise prices now when it would be very hard for you to make it up with mid-season service rate increases and keep your customers. If you lose your customers, they lose your business altogether.
     
  6. tinman

    tinman LawnSite Bronze Member
    from ga
    Posts: 1,348

    :dizzy: Gas & Deisel prices are killing me. Deisel was 1.51 for most of the summer then when gas started coming down a little Deisel went up & is now 1.85 & up here in Georgia. Georgia is usually amoung the cheapest on fuel so I feel for the rest of the nation. My prices will definitely be going up next year.
     
  7. tremor

    tremor LawnSite Bronze Member
    Posts: 1,476

    All raw materials are up right now & yes it is mostly related to the cost of Natural Gas. Some are blaming the Iraq War, but the real issue is the cost of crude topping $49/barrel. The cause of this is increased demand in the Asian (China) markets where they're just starting to come into the real world as we know it. Their consumption isn't going down, so this is a new reality the oil producers are going to need to start building for.

    If this is a cold winter here in the US, we can expect these prices to hold or increase through the 2nd & maybe even the 3rd rounds of 2005.

    A mild winter might see some slim downs by the end of Round 2 if blenders don't fill the bins with expensive raws.

    But keep in mind the smaller blenders have to make certain minimum orders to buy full bulk rail or barge. These guys will be feeling the crunch for a while.

    We've got a nice position on Urea for a while. But we use Natural Gas to coat it with S & Poly so the PPSCU can still change. DAP, MOP, SOP, etc are all up too. So for the next 2-3 rounds, expect ferts to stay high.

    Transportation costs are what they are. If Diesel does drop it won't change much. The new DOT regs control a drivers log more than ever before. And our industry is just beginning to realize the true cost of paying a driver to sleep.

    The bottom line here is that America has to get off her high horse & start reexamining & working our own domestic reserves. Between the Gulf of Mexico (where oil oozes out of the ocean floor because there is too much of it) & Alaska, we could easily reduce our dependence on imported crude if we'd get our act together. I'd sooner hunt the Caribou than worry about they're hanging around a refinery or getting hit by a truck. Endagngered Lichen don't break my heart either. Jeez!
     
  8. Ric

    Ric LawnSite Fanatic
    Posts: 11,957

    Tremor

    Florida's Gulf Coast has tons of oil. But the Tree Huggers won't let them drill off shore for it.

    Hurricanes of this season might just be a good thing in many ways. Florida has got to totally change it's Retirement---Tourist Economy. Tax base is derived from Sales Tax, Property Taxes, Hotel Bed Tax and Lotto. Industry plays a very small part in Florida's tax base. Off Shore drilling would totally change the Economy by pouring billions of Dollar into Florida's Economy and create millions of jobs and support industry.

    Now insurance premiums are going to go out of sight along with Building costs of increased Hurricane code standards. The snow ball effect will increase all price here. Retirement in Florida is soon to be out of the reach of the Working Class Man.

    In the short run, we must increase our prices to cover our costs. However the Fertilizer-Pesticide Industry in general is hurting. I can actually buy some chemicals cheaper this year than last. I am sure supplier are not paying less for these products. However Lesco seem to be holding it own in the big picture. My local Lesco has been very good about pricing lately and I am starting to buy from Lesco again. My issues with Lesco have never been Quality or Service. I buy by the pallet and could get better prices. However Lesco Quality is worth a few pennies more. When I first started into this industry it was Lesco that gave me my first Education.
     
  9. tremor

    tremor LawnSite Bronze Member
    Posts: 1,476

    Maybe it's time to ignite some serious dialog in Florida for the Oil Lobby. I know a geologist who claims the Gulf would be CLEANER if quality drilling were to take place. The oil is too near the surface & weeps out causing slicks. Green Peace has been known to chase slicks looking for leaking tankers only to find none there. The oil industry does not consider it good practice to spill oil overboard anyway. LOL

    I read this morning that 31% of those polled are reconsidering Florida as a primary residence after this Hurricane's season. If only a third of these people are serious enough to leave, Florida's economy will take a beating.

    So Jeb might want to try to strike while the economic iron is hot.
     
  10. Ric

    Ric LawnSite Fanatic
    Posts: 11,957

    Tremor

    There are Mixed Emotions about the future of Florida. Many have already left. Others are quickly rebuilding. This is my home and I am staying. Now there are many sign around town "We buy damage home for Cash". It has been 6 weeks since the Eye of Charlie and there is still tons of debris that hasn't been touched. But I see Skid Steer and back hoes on the side of the main roads with "For Hire" signs on them. Plenty of work to be done, But NO MONEY to pay for it. Those who could afford to repair and rebuild have already contracted it. Everybody is complaining about the insurance settlements. FEMA has done nothing to help the middle class man. If you have any kind of insurance FEMA won't help at all. The real sorry part is the lower middle class retiree who's mobil home is damaged and new Hurricane code requires up grades they can not afford. Their Insurance will cancel and the bank will repossess it for lack of insurance.

    This winter will tell the story when Snow Bird season starts. However it has been 44 years since my area got hit. If the cycle has changed and we are hit again next year Florida will definitely be hurting.

    My PhD Brother in law, worked in Louisiana for a large oil company for over 30 years. In the early 70's I was give a tour of all the offices. In the exploration research office was a group of maps that were open for all to see. Until I looked and spotted Charlotte Harbor. Once I said "Oh that near my town", it was quickly covered up and I was quickly moved on. Yes there is Plenty of Oil Off Shore. Had they not made such a big deal about covering up the Map, I would not of realized it at that time.

    The Tree Hugger have Killed the Commercial Fishing Industry and are quickly taking a big bite out of Big Sugar. Citrus is still alive, but Citrus Canker is a big problem. Florida Public Education is now number 47 and trying hard to be Number 50 because of the lack of tax money.

    You are 100% right


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