U.S. Gulf: Prompt granular barge prices continued to move up last week. While loaded barges at NOLA were reported to be trading as high as $312/st FOB last week, those to be loaded in two weeks were still down in the $280s/st FOB.
Upriver barges were receiving a larger premium, called $300-$325/st FOB on a NOLA basis, with the lower end reported as Chinese product. One player said upriver was the place to be, as buyers wanted to product right now.
While some initially called May barges $260-$265/st FOB, others last week thought those, too, would firm, though others said the vessel-to-barge delays should soon abate and pricing stabilize.
Prills also followed the granular boost, up at $270-$280/st FOB.
Eastern Cornbelt: The granular urea market was pegged in a broad range at $330-$360/st FOB in the Eastern Cornbelt, up $5-$15/st from last report, with the low reported in Cincinnati, Ohio, and the upper end out of inland terminals in Ohio and Indiana.
Western Cornbelt: The granular urea market was reported in a broad range at $325-$345/st FOB in the Western Cornbelt, with the upper end in Iowa and the low in Missouri on a spot basis.
Northern Plains: Granular urea pricing had reportedly firmed to $340-$350/st FOB the Twin Cities, up $15/st from last report. In North Dakota, sources quoted the urea market at $392-$410/st DEL, with the low end also reported on an FOB basis out of Carrington for “very limited tons.”
Great Lakes: The granular urea market was pegged at $365-$370/st FOB in the Great Lakes region, with the upper end FOB Webberville, Mich., and the low FOB Burns Harbor, Ind., and out of terminals in Wisconsin. Sources said they expected a price increase in the near term due to stronger NOLA barge values.
Northeast: Granular urea was pegged at $345-$360/st FOB in the Northeast, with the low at East Liverpool, Ohio, and the upper end FOB Fairless, Pa.
India: The final take in the STC tender moved closer to a half million tons.
Sources report MTPL added two more cargoes to its initial award of 60,000 mt. Its 180,000 mt, combined with the 300,000 mt coming from Global and Transglobe, will ease concerns in India about having enough product on hand to deal with the upcoming application season and have enough in reserve for the next season.
MTPL may face a serious problem, say sources. Reportedly, the company is offering Chinese product. Producers are upset with the low price offered and are threatening to not back any deal that means a netback lower than $260/mt FOB.
The MTPL offer has a netback in the mid-$250s/mt FOB.
The trading house may still be able to salvage its deal without a financial loss, say sources. The Chinese domestic season has now ended. At the same time, urea production remains at the same levels. All the tons now being produced are heading for the export market. In another week or so, said one trader, the port-side warehouses will have too many un-booked tons. To move the material, the price will have to drop.
MTPL has until May 27 to ship its material to India. Sources say this is plenty of time for the price to slip.
If the price does not move enough, however, sources say MTPL will most likely swallow hard and accept a loss on the deal rather than not perform. Indian buying companies continue to ban a couple of companies that did not perform last year after Chinese producers raised the price of their product to levels that could have caused near financial ruin for the firms if they bought and delivered tons based on the tender results.
Industry watchers say another tender will have to be called soon, however. The STC tender was supposed to