Question-and-Answer Session
Operator
Your first question comes from Robert Koort - Goldman Sachs.
Robert Koort - Goldman Sachs
I got a couple of questions; the first is, you talked about your hedged gap exposure going out. Do you have orders matched up against that and to what extent is there any risk about making sure your counterparties make hole on those prices given that gas is somewhat lower?
Mike Bennett
Well, first of all Bob, if you look at what was reported at the end of the quarter, we typically report the approximate size of that percentage turns to your annual demand and then typically we’ll also disclose how that position is under or over/under water, relative to the market at that date.
So basically when you look at what we disclosed at the end of the Q1, we had somewhere in the neighborhood of about 25% or so of our forward gas requirements for the next 12 months. Those were typically weighted pretty heavily towards the nearby quarter and the majority of those are going to have the forward orders basically fixed against them.
In this case, I think that position was roughly $30 million or so over market, at the end of the quarter, which realistically probably would average out the ballpark of buck in MMBtu or so, on that gas position.
So, first of all the majority of that gas does have orders against it today. We have a very I think rigid risk management policy relative to our counterparties, where we only deal with investment grade counterparties and limit that risk much the same way we would credit rank a customer and so we really feel that that position holds as little if any risk for our shareholders.
Robert Koort - Goldman Sachs
Then second question, sort of a mass balances if you will. You talked about how much imports are down; I think you said down 50% in solutions, your own capacity down; you had a corn crop that’s out there, probably rivaling last years. Where are we going to get enough supply to fill that need or are we actually going to see reduced application rates in nitrogen to match them or what we are seeing in potash and phosphate?
Mike Bennett
Well Bob it’s always a little bit of an inexact science in part, because it’s difficult to measure the amount of inventory that’s actually in the supply chain. Based on what I will call our best guess, we do think that the supply chain on UAN came into the year last July with relatively high inventory levels.
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