U.S. Gulf: Prompt barges that were loaded or ready to go continued to be strong last week at $400-$420/st FOB, according to most sources. While most saw a big fall-off for May to $355-$365/st FOB, others argued that April remains pretty firm for now. April was generally put between $388-$410/st FOB.
The last done prills continued to be called $390-$395/st FOB, though some players were indicating $380s/st FOB for the next round of business.
Eastern Cornbelt: Granular urea was steady at $450-$460/st FOB in the Eastern Cornbelt, with the lower numbers reported out of the Cincinnati, Ohio, market.
Western Cornbelt: The granular urea market was steady at $455-$465/st FOB in the Western Cornbelt, depending on location. An Iowa contact pegged the common dealer market at the $460/st FOB level in late March.
California: Granular urea pricing was reported in the $460-$465/st FOB range in California, down some $20/st from last report, with the low reported out of the Stockton market.
Pacific Northwest: Granular urea FOB the Rivergate terminal in Portland, Ore., firmed $10/st on March 26, moving to $490-$495/st FOB. Delivered urea was steady at $525-$545/st in the Pacific Northwest, depending on location.
Western Canada: Sources quoted the granular urea market at $680-$705/mt DEL in Western Canada, up slightly from last report.
Pakistan: Sources report that Saudi Arabia and Pakistan have completed a deal for 100,000 mt of urea for April and May. No price was put on the deal.
This government-to-government arrangement is separate from the 125,000 mt Pakistan is still expected to buy with Islamic Development Bank money. Industry sources say Pakistan will need 200,000-300,000 mt for the upcoming season. The Saudi-Pakistan government deal is a start on building the necessary reserves.
Each week Pakistan’s media report new government estimates of the country’s urea needs. The government has authorized the import of the tonnage under an Islamic Bank loan. The Trading Corporation of Pakistan will carry out the purchase by public tender once the bank and the Pakistan government come to an agreement on the terms.
One trader noted that the biggest problem Pakistan is facing is the number of deals and government-to-government arrangements with Saudi Arabia.
Sabic is in no mood to dramatically lower its price once it knows it has a captured client, said one trader. Pakistan must accept the Saudi price or miss out on loans and grants for fertilizer and other vital purchases.
One trader said it then becomes hard for TCP to argue with another supplier that the price should be lower after accepting the higher Saudi price.
To add difficulties to the government’s efforts to import more urea, the domestic producers have once again begun their campaign to get more natural gas allocated to them in an effort to end imports
A shortage of natural gas in Pakistan has forced the government to cut back on supplies to the urea producers in favor of consumer use.
The producers argue that their urea is cheaper than the imported tons. As a result, they say, the amount of money the government has to spend on subsidies is less. This argument has been used and rejected for a number of years.
Middle East: Arab producers are having a hard time justifying their offers of $340/mt FOB when Thailand is looking at $340/mt CFR and lower. Sources say the Thai bids are not that serious just yet, but they are an indication of where a price follower is seeing the market.
Sales to the U.S. have slowed down, and sources report that demand from Australia is not where it should be at this time. Australian purchases usually allow A