Urea is now the most used nitrogen (N) fertilizer source in Minnesota. The switch away from anhydrous ammonia (NH3) has occurred for many reasons. Some of these include safety of the product, needing specialized equipment for storing, handling and applying, and a narrow range of soil conditions when anhydrous ammonia can be applied. Despite these issues, there are reasons to still consider anhydrous the best source of N in many situations.

Graph showing nitrogen fertilizer use in Minnesota over time. The rise of urea has replace some ammonia use while UAN has grown some too.

The Science

The N content of anhydrous ammonia is 82%, making it the most concentrated N fertilizer available, and therefore the most efficient with respect to its weight and the space it takes up. This means that less product needs to be transported and applied to the field to get the desired N rate. This results in savings of both time and money for the farmer.

Anhydrous ammonia is the feedstock from which all other N fertilizers are produced. This means that every other product – such as urea and urea ammonium nitrate (UAN) blends – has an additional processing step that adds to the cost of the product. Because of this, anhydrous ammonia will almost always be the cheapest N fertilizer on the market, unless some external factor is involved (such as overhead cost associated with storage and application or market anomalies that cause a temporary price inversion).

When anhydrous ammonia is applied, it converts to the ammonium cation very quickly. Cations have a positive charge and are readily bound to negatively charged clay particles. Over time, biological activity in the soil converts the ammonium to nitrate. Nitrate is negatively charged and moves through the soil freely with water and therefore is subject to loss. This conversion is dependent on heat, time and moisture. The behavior of anhydrous ammonia in this manner contrasts with urea, which is water-soluble and a neutral molecule that turns to nitrate very quickly, or to UAN, which is 25% nitrate at the time of application. In addition, the caustic nature of anhydrous ammonia stunts the microorganisms that convert the ammonium to nitrate, causing further delay. It is for these reasons that anhydrous ammonia is the only N fertilizer source recommended for fall application for most of Minnesota (except southeast Minnesota, where no fall application of any source is recommended, or northwest Minnesota, where fall application of urea is still acceptable).

The Economics

Nitrogen fertilizer rate recommendations are based on the price ratio of a pound of N versus a bushel of corn. This price ratio has been at 0.1 for most of the last twenty years. The escalation in fertilizer prices this past year has driven the price ratio to as high as 0.2. This has the effect of lowering the recommended N rate. A recent price quote from a southern Minnesota fertilizer dealer has anhydrous ammonia this fall at $865 per ton. This puts the price of N at $0.53 per pound. Current futures prices for corn at some points of delivery in southern Minnesota are above $5 per bushel. This brings the price ratio to just over 0.1, or “back to normal.”

There are many acceptable options for N fertilizer in the spring and in-season that involve many types of fertilizer. Current prices for urea and UAN on the world markets are over $0.70 per pound of N. Of course, we will not know where those prices will be for spring 2027 at points of retail in Minnesota until around December.

Nevertheless, it makes sense from an economic perspective, as well as from a scientific one, for farmers to still consider anhydrous ammonia as a preferred N fertilizer source.