Fertilizer prices, already on the rise before Russia invaded Ukraine, have been sent into the stratosphere. How soon are they likely to return to earth? According to data from the American Farm Bureau and the United States Department of Agriculture, fertilizer costs are expected to jump 12% this year, after rising 17% in 2021. According to an agricultural publication, the price of fertilizer, diammonium phosphate, is the highest ever.
A wave of anxiety is hitting farmers around the world. Peru declared a state of emergency for its agriculture on April 8. Economists forecast widespread increases in food prices.
How did American producers react?
Soybean planting intentions ‘shocked the industry’
An immediate response appears to have been the decision of row crop growers to plant more soybeans than corn. The price of both commodities has risen and corn has great profit margins right now, but soybeans require fewer inputs, including fertilizer, than corn. Many maize growing areas are also facing a dry summer.
According to the Prospective Planting Report released March 31 by the USDA’s National Agricultural Statistics Service, growers surveyed across the United States intend to plant a record 91 million acres of soybeans in 2022. , up 4% year-on-year. Purdue University’s Commercial Ag News said the planting intentions report “shocked the industry with surprisingly small planting intentions for corn and surprisingly large planting intentions for soybeans.” The NASS acreage estimates are based on surveys conducted during the first two weeks of March among a sample of nearly 73,000 farmers across the country.
Seeded acreage intentions for soybeans are up or unchanged in 24 of the 29 estimated states. The largest increases are expected in Illinois and Missouri, where growers in each state aim to plant 400,000 more acres than in 2021. Planting intentions may change, but if they materialize, the acreage planted with soybeans in Illinois, Kentucky, Michigan, Missouri, Nebraska, Ohio, South Dakota and Wisconsin will be the largest on record.
Corn growers said they plan to plant 89.5 million acres in 2022, down 4% from a year ago. Decreases in corn acreage from last year of 200,000 or more are expected in Illinois, Indiana, Iowa, Kansas, Minnesota, Nebraska, North Dakota and Wisconsin . Record acreage is expected in Nevada and South Dakota. Record acreage is expected in Connecticut, Massachusetts and Rhode Island.
Interest in alternative practices is growing
Producers are also increasing their exploration of alternatives to chemical fertilizers. A Reuters article reports that an Illinois manure supplier is experiencing record demand.
David Kleinschmidt, a longtime proponent of regenerative practices, told the High Plains Journal that his institute, UnderstandingAg, has “never had so many requests. I have daily phone conversations” with growers exploring the regenerative approach, which uses less and sometimes no chemical fertilizers. “Now is a good time to focus on soil health,” Kleinschmidt said.
UnderstandingAg teaches principles rather than silver bullets, Kleinschmidt said, including that every piece of land is different and requires in-depth study and a tailored approach. “Farmers are looking to diversify crop rotations more, to recycle more nutrients from the soil.” Grain rye and legumes can be rotated with corn and beans for better soil health, and ruminants can play an important role in Kleinschmidt’s vision if grazed properly.
“The back and forth between the corn and the beans is more of a pendulum motion than a real rotation,” Kleinschmidt said. Adding a small grain to the rotation with various cover crops incorporated into the rotation can improve soil health. With proper management, farmers can significantly reduce the amount of inputs needed to produce a crop without sacrificing yields and improving overall farm profitability.
He worries that with the West facing more drought, many areas, including western Kansas, could face another Dust Bowl.
Among the alternatives that are seeing renewed interest is a product from a startup called CoverCress Inc. which has genetically modified pennycress grass into a cover crop that can provide an additional source of income for farmers. , while requiring fewer inputs and field trips.
CoverCress is a new oilseed crop grown over the winter between normal full season corn and soybeans. It acts as a cover crop while producing oil and protein-rich food that the company says can fit into markets similar to canola. While CoverCress is a brassica like mustard and does not fix nitrogen like legumes, it can reduce fertilizer and water use like other cover crops.
CoverCress Inc. (formerly known as Arvegenix) has been developing its CoverCress cover crop from the common native pennycress since 2013. Its team of geneticists removed some undesirable traits, increased its oil content and yield, and tweaked it. transformed into a commercial crop.
Native pennycress grain has high levels of erucic, fiber, and sinigrin, compounds that limit the use of its oil and flour. But CoverCress geneticists have developed strains that have a new composition and make CoverCress a whole new crop for the American Midwest, without the limitations of native pennycress, according to the company.
Dale Sorensen, Commercial Director of CoverCress, said recent farmer interest in CoverCress was “beyond my wildest speculation”. “Soybean and hard corn growers are showing interest,” he said.
CoverCress is a “nutrient scavenger” that would work well in rotation with nitrogen-fixing cover crops as part of a total cover crop rotation with corn and soybean production, he said. “We get four crops a year in the greenhouse,” he told the High Plains Journal. He said CoverCress’ nutrient requirements are “significantly lower” than winter wheat, about 40 to 50 pounds of nitrogen per acre.
This year has been a rollout year for the commercialization of CoverCress in the central Illinois and eastern Missouri launch area, with between 8,000 and 10,000 acres planted for harvest in the fall of 2022 for a harvest in the spring of 2023 with seeds provided under the cereal harvest contract by CoverCress. Given the level of interest, CoverCress hopes to significantly expand its footprint over the next few years.
Sorensen said the company is now focusing its marketing efforts on high-quality oil that can be produced by crushing CoverCress, comparable to canola oil. “Currently we are not pursuing the food market, but we are focusing on biofuels,” he said. The vegetable oil market has recently exploded due to demand for renewable diesel feedstock. CoverCress can be crushed for oil or flour. Although the meal contains less protein than soybean meal, it has been used for chicken production. The oil content is higher by weight than that of soybeans. Sorensen said researchers worked on improving the quality of meals for cattle after the crush.
Agriculture startup Pivot Bio is another company offering alternatives to traditional fertilizers that has garnered record interest. Pivot Bio calls its approach “precision microbial adaptation”. She has developed a proprietary, patented microbial liquid product that she believes could significantly reduce the use of traditional fertilizers, while delivering the same amount of quality nitrogen to the soil. It is an in-furrow product that is applied directly to the seed via a drill.
The microbes in Pivot Bio are mapped using intensive AI technologies and produced by fermentation, according to the Pivot Bio website. They are fed with sugars until they reach a high enough concentration to be sold. “Fermentation replaces the Haber-Bosch process, the energy-intensive process of creating synthetic nitrogen, and reduces GHG emissions by 89%,” its website claims.
Pivot Bio’s mission “is to provide plant-ready nitrogen without negative side effects,” according to Randy Minton, Pivot Bio’s Sustainability Task Force Leader. “We are the only company in the world to have shipped a synthetic nitrogen fertilizer replacement at scale and with performance that meets the high demands of farmers.”
“We have competitors” in soil nutrition, he said, “but no one is doing exactly the same as us.”
“Our product will not cover all the needs” in terms of soil nutrition, he added. Instead, it can provide up to 20% of the soil’s total nutrient needs when used in combination with traditional fertilizers or manures. It’s a flexible product that can be used with all kinds of soil management practices, Minton said: traditional, organic and regenerative.
Pivot Bio launched its first commercially available product in 2019, for corn, and is on its fourth release in three years. It has more than 125 patents (granted and pending), more than 300 employees and more than 800 representatives in the sales networks. Its products have been used on 1 million cultivated acres and its second-generation product “allows corn growers to replace up to 40 pounds per acre of synthetic nitrogen with a better nitrogen source,” Minton said.
Minton said the carbon emissions savings from replacing conventional fertilizers with Pivot Bio would be equivalent to planting 16 billion trees.
“We’ve seen fantastic demand emerge,” Minton said. Pivot Bio exhibited at this year’s Commodity Classic.