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December 18, 2015 CapitalPress.com 7 Experts: Nitrogen prices to stay low in 2016 Courtesy Kinder Morgan Centerline Ag Services accidentally hit a pipeline transporting diesel and gasoline in late September near Aurora, Ore. The trench was being dug for irrigation equipment in preparation for blueberry planting. Fuel pipeline incidents highlight need for caution By MATEUSZ PERKOWSKI Capital Press A fuel pipeline rupture involving an agricultural ex- cavator was narrowly avoided in Oregon recently, pointing to the need for caution when dig- ging, experts say. An agricultural services company was creating a trench for irrigation equipment in preparation for blueberry planting in late September when it hit a pipeline trans- porting diesel and gasoline from Portland to Eugene, ac- cording to the Oregon Public Utilities Commission. While the incident did not rupture the pipeline, a Califor- nia agricultural excavator was killed in a November explo- sion after breaking a natural gas pipeline while preparing a field for almond planting, said Kevin Hennessy. chief of pipe- lines safety for OPUC. “The similarities between the two were eerily similar,” Hennessy said. “It could have been much worse.” The two incidents have prompted the commission to remind farmers about the im- portance of coordinating any excavation with utility provid- ers, he said. In this case, Centerline Ag Services did contact the Ore- gon Utility Notification Center to locate pipelines by calling 811, but miscommunication nonetheless led to machinery striking the fuel pipeline near Aurora, Hennessy said. The problem occurred partly because the excavator reported the wrong type of operation — the company said it intended to conduct subsoiling at 18 inch- es of depth, he said. In fact, a trenching opera- tion for irrigation equipment, which unearthed the pipeline, was conducted at a depth of at least 36 inches, Hennessy said. The mistake was caused by an employee trenching in a dif- ferent portion of the field that intended, which could have been avoided if the excavation company fully informed the utility of all operations in the area, said Andrew Holbrook, operations manager of the Northwest division of Kinder Morgan, which owns the pipe- line. It’s also important to keep employees apprised of the location of pipelines and where excavation is intend- ed to occur, Holbrook said. “They need to ensure every- one in their work crew un- derstands what’s involved in working around a pipeline,” he said. “Have that meeting in the morning. Make everybody aware of what they’re going to be doing that day.” Capital Press was unable to reach Centerline Ag Services for comment. Excavators can be fined $1,000 for failing to follow notification rules, but in this case that penalty was suspend- ed because Centerline Ag Ser- vices agreed to undergo joint pipeline safety training with Kinder Morgan, said Hen- nessy. Various factors combine to drive down prices for urea, other fertilizers By MATEUSZ PERKOWSKI Capital Press Farmers can expect pric- es for nitrogen fertilizers to generally stay low in 2016, though seasonal spikes in demand may cause moderate increases, experts say. A combination of high global output and reduced farmer demand has driven wholesale nitrogen fertilizers to the cheapest levels seen in years, experts say. “We’ve had a sinking international market,” said Glen Buckley, chief econo- mist for the NPK Fertilizer Advisory Service. Urea, a globally traded commodity and bellwether for the nitrogen market, was recently selling for about $230 per short ton in the wholesale market along the U.S. Gulf Coast. To compare, a short ton of urea hit $400 in early 2014 and then traded well above $300 for the rest of the year. During its most recent peak, in the spring of 2012, urea topped $700 per short ton. The same market forces are affecting other common nitrogen fertilizers, said Clive Yearsley, chairman of the Profercy fertilizer mar- ket analysis firm. “All those products are in the same boat.” Despite low prices, urea manufacturers have contin- ued churning out the fertiliz- er — rather than suspending production — because nat- ural gas, the primary ingre- dient, is so inexpensive, he said. Production costs have re- cently fallen as low as $80- 90 per short ton, so manufac- turers still have an incentive to produce, Yearsley said. Mateusz Perkowski/Capital Press Urea is applied to a grass field in the Capital Press file photo. Prices for urea and other nitrogen fertil- izers have plummeted and aren’t expected to recover significantly in 2016. “There’s always a lot of mon- ey left over.” With a plentiful supply of nitrogen available, major fer- tilizer buyers aren’t rushing to stock up, which has helped depress prices, Buckley said. “They’re saying, ‘Why not wait?’” Retailers are reluctant to hold inventories until they’re more confident of demand from farmers, he said. “They will buy, it’s just a matter of time,” Buckley said. If there’s a surge in de- mand during spring, as has occurred in the past, that could drive up wholesale urea prices to $270 per short ton by late March or early April, he said. Retail prices are higher due to transportation costs and can vary depending on wholesale prices at the time when dealers built up their inventory. By late January, however, farmers should lock in the bulk of nitrogen they plan to use in spring, Buckley said. While a seasonal uptick in nitrogen prices is possible, it won’t have a long-term im- pact on the downward trend in prices, said Yearsley. “That would be a bounce.” New urea factories have come online in Algeria and Saudi Arabia, and further ca- pacity increases are coming in 2016, so the global supply will remain high, he said. Meanwhile, cheap oil has weighed down the price of natural gas in areas where it’s traditionally more expensive, allowing them to continue urea production, he said. On the demand side, farm- ers in countries such as Brazil haven’t been able to afford as much urea because their currencies have weakened against the dollar, which is the currency used in the fertilizer trade, Yearsley said. All of these factors con- tribute to an abundance of nitrogen on the global market, keeping prices down, he said. “We will have to find out who will turn off the tap,” Yearsley said. Exports from China, a ma- jor urea supplier, are likely to slow in the coming year because the fertilizer is made with coal gasification, rather than natural gas, he said. While coal prices have fallen, the drop hasn’t been as sharp as for natural gas, Yearsley said. Chinese manu- facturers are feeling more cost pressure, but they’re expected to keep producing, he said. “They’re not going to disap- pear.” Researchers: Denser soil reduces wireworm pressure By JOHN O’CONNELL 3 Years @ 0% Capital Press ABERDEEN, Idaho — Researchers involved in a University of Idaho wire- worm study have found pop- ulations of the pest tend to be lower in cereal fields with more compact soil. The UI Extension scien- tists — entomologist Arash Rashed and barley agrono- mist Chris Rogers — have also seen evidence in green- house testing that wireworms hit wheat harder than barley. “It could be differences in the amount of root exudates and respiration between wheat and barley,” Rogers said. “We don’t have any data on that yet.” Rashed and Rogers are analyzing data from the sec- ond year of a three-year wire- worm study, funded annually with $35,000 from the Idaho Wheat Commission, $15,000 from the Idaho Barley Com- mission and additional rev- enue from Regional Ap- proaches to Climate Change, a partnership involving UI, Oregon State University, Washington State University and USDA. Rashed said the study started in 2014, monitoring 10 fields for wireworms. The researchers solicited addi- tional growers to participate at cereal schools and mon- itored 75 fields, spanning from Twin Falls to Ashton, in their project’s second year. Upon confirming the pres- ence of wireworms in a field, they’ve continued routinely checking traps at different soil depths. They’ve also ask growers for crop rotation and tillage practice histories. They’ve confirmed sugar beet wireworm is the pre- dominant species in Idaho. UI is working to sequence the genome of the sugar beet wireworm and recently com- pleted a project it initiated to sequence the mitochondrial genome of the species. Mito- chondria are responsible for cellular energy production. 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In his soil analysis, Rog- ers said wireworm numbers seemed to drop as bulk densi- ty of soil increased — in both field and greenhouse testing. Rogers suspects wireworms have a tougher time moving through compact soil to feed on plant roots, He empha- sized none of the soils in the study were too compact to ef- fectively produce crops. Based on the soil com- paction observation, Rogers said, seed bed preparation could help limit wireworm pressure. Furthermore, no-till farming and planting alfalfa, which tends to compact soil, may also help. They plan to do further studies to test those theories, and to contin- ue recruiting growers for the study’s third year. Additional greenhouse testing will also focus on differences in how wheat and barley plants re- spond to wireworms. Rashed said there are no effective chemical controls for wireworms. The researchers have produced a bulletin to help growers identify different wireworm species. 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