Industry experts say the cost of wholesale CAN has increased by more than 50pc since Irish suppliers began to buy last November and December.
The wholesale price of urea has increased by around €50/t in the same period, adding an estimated €25-30/t to the price a farmer could expect to pay.
In the Irish context, the pressure on urea is not as severe as CAN, since most of the 100,000t of urea required for the Irish market was likely to have been secured before the price rise.
However, experts describe the CAN market as being under extraordinary pressure, with prices rising as each cargo arrives in Ireland.
Around 500,000t of CAN is used in this country every year, accounting for around half of the total fertiliser market of 1.1m tonnes.
One industry expert has predicted CAN prices of €260-290/t in the coming weeks as the replacement cost of CAN rises for Irish suppliers.
"There is no such thing as a soft landing in the fertiliser market," the expert warned. "The price either goes massively up or massively down.
"Last year manufacturers were left with mountains of CAN at ever-decreasing prices," the industry source explained.
"This year, CAN is scarce and the traders are driving up the price."
Given that the price a farmer pays for his fertiliser is calculated on the wholesale cost plus a margin for the supplier and merchant, higher wholesale prices mean higher farmer outgoings.
The industry expert predicted CAN prices will increase to €250-260/t from Irish suppliers to merchants in the coming weeks, with farmers paying €10-€20/t more to merchants.
"Ultimately we are heading for prices of €260-290/t for CAN," he claimed.
"Last year if farmers bought their fertiliser early they would have been burned badly because prices fell for the rest of the season. This year will be the opposite, with the best prices at the start of the season," he said.
Phosphate prices on the international markets have also been rising rapidly, with product increasing from US$320/t (€232/t) in December to its current level of US$510/t (€370/t).
Driven by huge demand for phosphate for biofuel production in the US and Brazil, phosphate prices increased significantly in 2008 to record levels of US$1,100/t (€800/t).
The farmer reaction last year was to cut phosphate use dramatically, resulting in a total depression in the phosphate trade. Prices fell even quicker than they had risen in 2008.
Manufacturers reacted by cutting their production volumes, while merchants and farmers came into this year with stocks almost down to nothing, compared to a usual stock level of 8-10pc.
The most recent phosphate price rise -- from $320-520/t -- is a supply-demand reaction to these low stocks.
Meanwhile, potash, used in the NPK compounds, has been very stable on the international markets. Prices for potash also rose in 2008, and fell afterwards, but never quite returned to the prices seen before 2008.
The industry expert predicted farmer prices of €350-370/t for 27-2.5-5 in this year's season, with the cost of 18-6-12 likely to be in or around a similar price range.