From what I've heard from Farmers, using fertilizer (potash) depends on their discretionary income during the year. Have a bumper harvest, or if the price of corn/wheat/whatever spikes, then they'll buy fertilizer the following year. Any other costs go up, and fertilizer gets 'shelved' unless its necessary because of soil condition, etc. When the price of corn spiked a couple years ago during the ethanol boom, the following years farmers were rolling in cash, and bought tons of fertilizer. Once the price 'settled' back down a bit, and demand dropped as ethanol plants were idled, they stopped buying. Potash cars went into storage, and even some LOADED trains went into storage because the demand dropped so fast.Standard Railfan wrote: Petroleum costs are expected to keep increasing driving up transportation costs.
So, if the price of fuel goes up, as you predict it will, then *something* is going to have to give. If they're spending more on fuel, less to spend on fertilizer, etc. Plus, if the Michigan Potash is 'premium' as everyone says, then who's to say they're going to want to buy it anyway? There is going to have to be a pretty substantial ROI for the farmers to buy the 'premium' stuff over the other sources.
Practice Safe CSX