Corn futures indicate strong US fert demand - CF

28 October 2008 16:20  [Source: ICIS news]

HOUSTON (ICIS news)--Corn futures prices for December 2009 delivery indicate that the upcoming seasons should be favourable for US fertilizer demand, CF Industries CEO Stephen Wilson said on Tuesday.

Corn futures for December 2009 delivery last settled at $4.43/bushel on the Chicago Board of Trade (CBOT).

"That price provides a clear incentive to plant corn this season," said Wilson.

Such a price will encourage farmers to plant corn instead of soybeans, he said. That, in turn, will boost fertilizer demand.

Fertilizer prices had been weakening because of seasonal variables, he said.  That lull was exacerbated by investors selling off commodity positions and by volatile corn prices.

The stock market has reflected concerns about fertilizer demand. CF stock was trading at $48.29 in early trading on the New York Stock Exchange, down from its 52-week high of $172.99.

"There is a lot of fear and loathing in global fertilizer markets today," Wilson said. "We don't think it's justified."

Wilson said the fundamentals that determine fertilizer demand remain strong.

World populations continue to grow, he said. At the same time, consumers in developing nations are eating more meat, which requires more grain to feed livestock.

"We are looking forward to a good fourth quarter and healthy corn acreage next spring," Wilson said.

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By: Al Greenwood
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