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Why Are Nitrogen Prices So High?

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Nitrogen fertilizer prices have been high for several months now. In some cases, the price has gone up 50 percent or more, but why is it increasing? The price of nitrogen fertilizers is directly related to the price of natural gas (methane). Manufacturing 1 ton of anhydrous ammonia fertilizer requires 33,500 cubic feet of natural gas. This cost represents most of the costs associated with manufacturing anhydrous ammonia. When natural gas prices are $2.50 per thousand cubic feet, the natural gas used to manufacture 1 ton of anhydrous ammonia fertilizer costs $83.75. If the price rises to $7.00 per thousand cubic feet of natural gas, the cost of natural gas used in manufacturing that ton of anhydrous ammonia rises to $234.50, an increase to the manufacturer of $150.75.

A reasonable question to ask is, Why is natural gas so heavily used in the manufacture of nitrogen fertilizers? I'll try to explain it. Nitrogen is all around us. In fact, the atmosphere is composed of 80 percent nitrogen. Unfortunately for our pocketbooks, it is not in a form plants can use. Small amounts of nitrogen are converted to plant-available forms and sent to the earth in lightning strikes. Some is returned to the soil when rainfall washes pollutants out of the air. Free-living blue-green algae convert small amounts of atmospheric nitrogen to plant-available forms. Bacteria in legumes' roots can convert atmospheric nitrogen to a plant-available form. However, of all these mechanisms, only the one legumes use supplies enough plant-available nitrogen for high-yield agriculture.

Here's where natural gas comes in. In 1910, scientists discovered that they could combine natural gas and the atmosphere at very high temperature (about 900 ºF) and pressure (between 200 and 1,000 atmospheres) to create anhydrous ammonia gas. This technique is called the Claude-Haber ammonia synthesis process. Natural gas is used in the process two ways: to react with the atmosphere and supply hydrogen to the reaction, and create the high temperature and pressure necessary for the process to take place.

What if you use a form of nitrogen different from anhydrous ammonia? Why should your nitrogen fertilizer costs increase? That's another good question. Most of the other popular forms of nitrogen fertilizer are made with anhydrous ammonia. Urea is formulated by a reaction between anhydrous ammonia and carbon dioxide at high temperature and pressure. Ammonium nitrate is formulated by combining anhydrous ammonia and nitric acid in a very corrosive manufacturing climate. Solution liquid fertilizers (28 to 32 percent nitrogen) are composed of one-half urea and one-half ammonium nitrate. It's pretty hard to apply a nitrogen fertilizer formulation that doesn't have natural gas in its manufacturing process.

What can you do about high nitrogen prices? Should you discontinue using nitrogen fertilizers or reduce rates until the prices come down? One thing you can do is collect soil samples to see if they have high levels of residual nitrogen. If so, you can reduce or even eliminate the use of nitrogen fertilizers without reducing yield. The very wet winter we had this year makes it unlikely that large amounts of nitrogen carried over, but it doesn't hurt to check. To test for residual nitrogen, take both a 0- to 6-inch soil sample and a 6- to 12-inch sample.

Other things you can do include realistically figuring your yield goals and fertilizing to meet these without using excessive amounts. Check your soil pH and apply lime if needed. Plants use nitrogen less efficiently in very acidic soils. Use the recommended rates of phosphorus and potassium. Plants use nitrogen more efficiently when these aren't limited.