U.S. Gulf: After a few weeks of price testing, the potash barge market was again quiet. Assuming someone wanted to buy potash right now, sources said they would be more apt to continue to test the market at $460/st or lower rather than pay any $20/st increase sought by producers.
Some very large buyers filled up at lower numbers a few weeks ago, though producers continue to argue that in general the industry ended the spring season on empty, and much more buying is needed.
“We’re seeing the occasional barge come into the U.S. that is disruptive, but it is what it is,” Intrepid Potash Inc. Executive Chairman Robert Jornayvaz told analysts Aug. 2. “It’s not as big as what we’ve seen in years past … It’s out there, it is having an impact.”
Jornayvaz said some of the downward price movement was premature, and that some of his North American competitors might have been too aggressive on price movement before the true extent of this year’s drought was known.
Jornayvaz also said he believes the worst is behind as far as price decreases. “I don’t see us going down much further, just given the discussions that we’re having and the needs that are out there,” he said.
Citing higher commodity prices and the need to grow corn, wheat, and soybeans, he expects growth in potash markets worldwide to kick in, and in a pretty dramatic fashion.
Intrepid Senior Vice President of Marketing and Sales Kevin Feist added that the company has studied the 1988 drought and found no cutbacks in potash. “In fact,” he said, “we saw slightly increased levels.”
Feist also referred to extremely strong commodity prices, which he said should drive world consumption.
Eastern Cornbelt: The potash market remained at $500-$510/st FOB regional warehouses in the Eastern Cornbelt.
Western Cornbelt: Potash was unchanged at $500-$510/st FOB regional warehouses, with most dealer quotes in the $500-$505/st FOB range in the Western Cornbelt in early August.
Southern Plains: Potash remained at $510-$520/st FOB Carlsbad, N.M., depending on grade. Out of regional warehouses in the Southern Plains, the potash market was steady at $500-$510/st FOB.
South Central: Potash was tagged at $500-$510/st FOB in the South Central region. Several sources quoted the common dealer level at the $505/st FOB mark in early August.
Southeast: Potash remained at $517-$520/st FOB in the Southeast, with rail-delivered tons pegged at the $530/st mark in the region, give or take.