(Repeating from earlier)
* Farmers put off fertilizer purchases due to high prices
* Delays may lead to last-minute surge in orders
* Dealers warn farmers may not get all products immediately
By Tom Polansek
CHICAGO, Feb 13 (Reuters) - Steve Georgi is playing chicken with the world's biggest fertilizer makers.
The Indiana corn grower has postponed buying the fertilizer he needs for spring planting for only the second time in 35 years, angry that prices for key nutrients surged more than one-third in the fourth quarter.
"I haven't bought anything yet," said Georgi, who normally makes his purchases around the beginning of the year. Prices are so high "it's ridiculous," he said.
Fertilizer prices jumped last fall on global demand and expectations for a large increase in corn plantings in the United States. While those expectations have not changed, the price spike has triggered a buying boycott by farmers across the Midwest, pushing sales volumes of key products to their lowest levels since the financial crisis crushed demand in 2008.
But farmers may lose in the face-off unless they place their orders soon.
Fertilizer distributors, many of whom were burned when demand evaporated in the 2008 price crash, no longer maintain large local stockpiles. That leaves some unable to accommodate a last-minute buying spree, meaning farmers who wait to buy may have to delay plantings or grow something besides corn.
Good weather helped farmers produce a record corn yield in 2009 even after they cut back on fertilizer used to increase output. Now, with U.S. corn inventories at their lowest level since the mid-1990s, any threat that plantings or yield may fall short of high expectations could fuel new fears about supplies and stoke a price rally.
"It's getting very close" to planting time, said Harry Vroomen, vice president of economic services for The Fertilizer Institute. "They can't delay forever."
SURPRISING DEMAND GAP
The buying boycott is the latest sign of a broader trend in which farmers, now flush with cash, are seizing more control over their operations and exerting more market power.
Net farm income jumped 27.5 percent last year to a record $100.9 billion, giving many farmers the flexibility to break free of traditional practices. Many have installed their own storage bins, giving them more leeway in timing the sale of their crops and exacting a higher premium from grain companies.
Farmers cashed in after Chicago Board of Trade corn prices reached a record high near $8 a bushel last July as strong demand drained supplies.
Prices have since fallen to about $6.50 a bushel due to pressure from the euro zone crisis and a larger-than-expected harvest. The timing was bad, as fertilizer prices started rising last fall.
Growers believe the price of fertilizer should follow corn lower, as nearly half the fertilizer used in the United States is applied to corn.
Strong margins for producers of nitrogen-based fertilizers do not make high prices easier for farmers to swallow. Costs for natural gas, used to make nitrogen fertilizer, are hovering near a 10-year low.
At Potash Corp, the world's top fertilizer producer, reduced demand knocked down nitrogen sales volumes by 15 percent in the last quarter to 1.1 million tonnes, the lowest for that quarter since 2008. The Saskatoon, Saskatchewan-based company has slowed production of another key nutrient, potash, at mines in Canada due to anemic demand.
The company said demand suffered as buyers "paused to assess market conditions." It predicted sales will rebound this spring as long as corn prices support an expansion of plantings.
Mosaic said in January it would cut potash production 20 percent over the following four months due to an oversupply.
Agrium, a smaller player in the fertilizer market, confirmed buying was muted in the fourth quarter, even though it reported an 8 percent rise in nitrogen sales volumes.
"We expect pent-up demand to continue to emerge," Agrium said this week.
Farmers' buying strategies have roiled corporate profits. Potash Corp is projecting one of its most profitable years ever but issued first-quarter earnings guidance of 55 to 75 cents that fell short of analysts' expectations of 84 cents.
Logistical problems could prevent farmers from snagging the fertilizer they want if they wait until the last minute to buy, dealers said.
Hintzsche Fertilizer in Maple Park, Illinois, is among the companies that likely will not have enough on hand unless orders come in soon, general manager Jeff Eggleston said.
Eggleston said he tells farmers, "I'm not buying it if you guys aren't committing. I'm not going to get stuck with it."
Some farmers may need to delay their planting because dealers will not be able to fill a flood of late orders, said Darrel Hora, general manager of Mettler Fertilizer in Menno, South Dakota. He said it was "not a realistic thing" to expect fertilizer dealers to keep enough fertilizer on hand to fulfill all the built-up demand from farmers.
"If the people wait too long to buy, they may have to wait a little longer until they get to apply this stuff," Hora said.
The risk of a temporary, last-minute shortage is particularly high if weather is warm and dry in the spring, encouraging an early rush to plant extra corn acres.
"If the season breaks early, then we could see this jump in purchases at the retail level," said David Asbridge, president of NPK Fertilizer Advisory Service. "We could see a price spike."
That could derail expectations for large corn plantings.
Farmers could plant soybeans, instead of corn, if they can not get their hands on fertilizer or decide prices are still too high. Soybeans require less fertilizer than corn and are planted later in the spring.
Still, many industry members, including Asbridge and The Fertilizer Institute's Vroomen, are sticking with forecasts for large corn plantings because corn prices remain historically high.
Analysts predict corn plantings will reach a 68-year high of 94.2 million acres, up 2.5 percent from 2011, according to a Reuters survey. They project soybean plantings will rise 0.4 percent to 75.3 million acres.
Georgi, the Indiana farmer, is in no rush to lock in his fertilizer. He said he was confident he will be able to buy the supplies he needs and has already seen nitrogen prices in his area fall about 7 percent since the end of November.
The only other time Georgi waited so long to buy his fertilizer was during the price spike of 2008-09. He said his patience saved him money that year and he will not finalize purchases this year for at least a few weeks in case prices continue to weaken.
"There's room for them to come down," he said confidently. (Reporting By Tom Polansek; editing by Jim Marshall)