Farm manager John Arnold is keeping a wary eye on the price of both pistachios and fertilizer these days. Based in Modesto, Calif., he manages about 825 acres of producing pistachios in Madera County. He sold his 2008 pistachios for $1.90 a pound.

“Last year, insect damage was low, nuts were large, and quality was absolutely super,” he says. “Pistachio prices have been spectacular — but I don’t see how they can stay up there. Look at almond prices; they’ve gone ‘way down.”

While fertilizer prices are also down from last season’s peaks, Arnold notes, they’re still higher than this time last year. Potassium was selling for $350 a ton before skyrocketing to $1,200 a ton in midsummer, Now, the price is around $750 to $800 a ton.

Last year, Arnold paid as much as $450 to $480 for a ton of UAN 32. It’s currently selling for around $350 to $370 a ton, but that’s still 20 percent to 30 percent higher than a year ago. Sulfuric acid prices have doubled and ammonium sulfate has become gotten more expensive.

“Fertilizer cost is one area we’re watching very closely,” Arnold says. “We’re also looking for cheaper sources, and we’re trying to use fertilizer more effectively by running it through our drip and micro-sprinkler systems rather than banding it on the ground.

Chilling hours this winter were enough to produce a decent crop for 2009. Assuming he can get the current level of prices for this year’s pistachios and potassium sulfate costs aren’t too high, he plans to continue with his current fertility program.

“Otherwise, we’ll probably cut back on fertilizer use so we don‘t blow our budget,” he says. “We can cut back on N and K for a year or two without hurting yields. We’re worried about how much money we’ll spend this year.”