Why limit seed-placed fertilizer?

The safe recommendation for seed-placed fertilizer for canola is this: Apply no more than 20 lb./ac. of phosphate in the seed row. Place all other fertilizer, including extra required phosphate, in a side band or mid-row band where it will not harm germinating seeds.

Why limit seed-placed fertilizer?

Generally, small-seeded crops such as canola are more sensitive to seed-placed fertilizer, especially nitrogen and potassium. Nitrogen injures seedlings in two ways: by salt effect that reduces water uptake by the seed, and by ammonia toxicity. The high salt index of potash fertilizer also limits the amount that can be safely applied near the seed. Common sulphur and phosphate fertilizers also contain nitrogen, which is a risk factor with these products. A recent study showed that combining ammonium sulphate and ammonium phosphate in the seed row greatly reduces seedling survival. Because phosphorus is not mobile in the soil and because phosphorus is more important for early growth, especially in cool soils where availability may be reduced, phosphate takes precedence over sulphate for seed-row placement.

What increases the risk of fertilizer damage in the seed row?

Low moisture. Damage is worse in dry conditions.
Low seed-bed utilization. Narrow openers and wider row spacing means more seed and fertilizer are packed into a smaller area.
Lighter soils. Clay soils hold more nitrogen in the ammonium (NH4) form. In sandy soils, more ammonium converts to ammonia, which is the form that causes seed and seedling damage.
Higher soil pH. At higher pH, more of the N from urea is in the free ammonia form (NH3) vs. ammonium (NH4). Ammonia is more damaging.

Further reading:

Canola Encyclopedia section on seed-placed nitrogen