Why the impact on nitrogen fertilizers?
The majority of N fertilizer sold in Iowa is either anhydrous ammonia, or products made from anhydrous ammonia (urea, ammonium nitrate, and urea-ammonium nitrate solutions) (Table 1). Ammonia is also a manufacturing component of other N-containing fertilizers such as ammonium sulfate, diammonium phosphate (DAP), and monammonium phosphate (MAP). Natural gas is a major feedstock in ammonia production for both energy and supply of hydrogen (H) in ammonia (NH3). The average natural gas consumption for anhydrous ammonia production is approximately 33.5 MMBtu (million metric British thermal units) per ton. Therefore, the ammonia production cost is closely tied to the price of natural gas. The average natural gas price for the past 15-20 years has been about $2.20 per MMBtu (divide the cost per MMBtu by 10 to get the cost per therm of natural gas). The price steadily increased to above $5.00 this past fall and winter and then spiked at a spot price of approximately $19.00 per MMBtu in early M
