1. Gary Schnitkey and team back this week with more on nitrogen fertilizer prices and corn production economics for 2022. Nitrogen prices have exploded in recent weeks. Up $278/ton in last two weeks alone! 
2. The +$278/ton price increase for nitrogen (anhydrous ammonia) sounds very scary. However, we need to keep in mind several things. First, that translates into a $25/acre increase in fertilizer costs. Not chicken feed but also not huge compared to overall production expenses.
3. Second, I am firmly in the camp that farmers here in the heart of the Corn Belt over apply nitrogen by a bit. Research indicates nitrogen rates can be pulled back slightly without hurting corn yields. Do this and the $25/acre largely disappears.
4. Third, the $25/acre cost increase can be offset by a price increase for corn of just 11 cents/bushel. Right now harvest bids of $5 for corn and $11.80 for soybeans are such that the net returns for corn and soybeans are basically the same here in Illinois.
5. Not saying that this is final word on corn vs. soybean profitability for 2022. Definitely a highly fluid and volatile situation. Just leaning against the chatter that the sky is falling for corn because of the high nitrogen fertilizer costs.
6. Here is the link to the new FDD on nitrogen costs farmdocdaily.illinois.edu/2021/10/manage…
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