Weather
Locations
Careers
Login
Crop input updates
Energy and fertilizer prices rise, while transportation rates come in mixed.
Energy costs rise.
West Texas Intermediate (WTI) crude oil prices reversed a downward trend mid-March, with supply pressures coming from larger than expected inventory draws and President Trump’s threat to apply tariffs to countries importing oil from Venezuela. Despite the upward move, several factors will continue to weigh on prices including an expected rise in production from the Organization of Petroleum Exporting Countries (OPEC+), slowing economic growth (particularly in China) and a potential easing of tensions between the U.S. and Russia. Natural gas prices have tripled since mid-November 2024 due to rising electricity demand from cold weather. Working gas in storage (a measure of inventory levels) fell to the lower end of the 5-year range in February but has since recovered. Warmer weather should alleviate price pressures over the coming months.
Transportation costs mixed.
Relatively soft oil prices helped reduce transportation costs overall, though recent gains may stop this trend. Trucking rates are mixed, with flatbeds experiencing increases as companies build inventories of steel, machinery and lumber to avoid potential tariffs and prepare for the 2025 building season. Bulk shipping prices rose notably from mid-February to mid-March on tightening vessel supply and increased demand for coal, mining and minerals. In contrast, container rates declined for the third month in a row as new vessel capacity came online while demand slowed. Many companies front-loaded goods ahead of President Trump’s inauguration. President Trump announced wide sweeping tariffs on April 2, and it remains unclear how countries will respond at the writing of this report. Specific tariffs on Chinese-built vessels are creating immense uncertainty within the industry (see Spotlight for more information). Both bulk and container carriers remain reluctant to use the Red Sea route due to continued volatility in the region.
Fertilizer costs rise.
Prices for nitrogen fertilizers are increasing in response to higher input costs (natural gas is the primary feedstock), increased corn acreage estimates and reportedly tight urea ammonium nitrate (UAN) inventories. Phosphate faces tight global inventories due to Chinese export restrictions, higher sulfur/sulfuric acid costs and rising demand. Potassium faces tight inventories and exposure to retaliatory tariffs from Canada. (Canada is the primary supplier of potash to the U.S.). Spring planting will continue to pressure prices across all three nutrients over the coming months.
