AMMONIA
U.S. Gulf/Tampa: While Tampa prices are settled for February, there was a lot of talk about March pricing last week. Sellers were spinning price ideas of $90-$135/mt DEL increases – or somewhere in the neighborhood of $455-$500/mt DEL.
Players gave several reasons for the higher expectations. They include strong demand from the U.S. phosphate industry, which is seeing high prices for its own products; the return of industrial demand overseas, particularly in Europe and Asia; the startup of the AUM UAN plant in Trinidad, which will now use its own ammonia and not be pumping excess into the Tampa market; and gas and pipeline disputes in Ukraine and Russia, which have kept production offline, particularly in Ukraine.
Eastern Cornbelt: The ammonia market was quoted at $400-$435/st FOB in the region, with the low reported for spot tons in Illinois. Effective Feb. 5, Agrium’s ammonia postings moved to $425/st FOB Illinois terminals at E. Dubuque, Niota, Meredosia, and Marseilles, and $435/st FOB North Bend/Finney, Ohio.
Western Cornbelt: The anhydrous ammonia market was quoted at $340-$390/st FOB in the region, depending on supplier and location, with the low in Nebraska and the higher numbers reported in Iowa. Koch’s ammonia postings moved on Feb. 2 to $340/st FOB Beatrice, Neb., $350/st FOB Aurora and Greenwood, Neb., and Whiting, Iowa, and $360/st FOB Sergeant Bluff, Iowa. Effective Feb. 5, Agrium’s ammonia postings moved to $400/st FOB Hoag, Neb., $405/st FOB Greenwood, $410/st FOB Whiting, Early, and Garner, Iowa, and $410/st FOB Mankato, Minn. One Iowa source talked of spring prepay offers in the $400-$425/st FOB range last week.
Southern Plains: One source said only 30 percent of the fall ammonia was applied in his location due to weather difficulties. The ammonia market was quoted at $320-$340/st FOB regional production points, with the upper end pegged at $360-$370/st FOB Kansas pipeline terminals. Agrium’s ammonia postings moved on Feb. 5 to $385/st FOB Mocane, Okla., $390/st FOB Conway, Kan., and $395/st FOB Clay Center, Kan.
South Central: Anhydrous ammonia pricing was quoted at $385-$425/st FOB regional terminals in early February, depending on location and time of delivery. The low was reported out of the Memphis market for prompt tons, while the high reflected spring prepay levels at other terminal locations.
Black Sea: Asian sources say the lack of production from the area makes nailing down prices difficult. Demand around the world is growing and putting pressure on the few producers that are operating. Sources say even with the strong demand, the shipments that are going out are still based on previous deals that were cut before the price started to move. Prices remain in the low $300s/mt FOB.
Middle East: Sources now report that producers are operating at full capacity and are having no problems finding buyers. Yara reportedly picked up 40,000 mt from PCC/Iran last week.
Prices have not changed since the FACT/India tender moved the price into the low $340s/mt FOB.
UREA
U.S. Gulf: Granular barge business last week was reported in the $318-$324/st FOB range, with forward business called $325-$328/st FOB. One player said that despite a steady stream of imports the market is absorbing them, with prices remaining around the $320/st FOB range, give or take a few dollars, during the past few weeks. Sellers also argue that strong international markets and positive expectations for U.S. demand underpin market psychology, though one negative remains weaker-than-hoped-for corn prices.
Eastern Cornbelt: The granular urea market was steady at $355-$365/st FOB in the region.
Western Cornbelt: Granular urea remained at $350-$365/st FOB in the region, with the upper end reflecting dealer reference pricing out of some locations.
Southern Plains: Granular urea pricing remained at $345-$350/st FOB in Oklahoma. One Kansas source quoted rail delivered tons at the $358/st level to his location.
South Central: Sources tagged the granular urea market a solid $350-$355/st FOB regional terminals to the dealer, with the upper end reported in Kentucky.
Southeast: The granular urea market was tagged at $360-$365/st FOB port terminals to the dealer, indicating a slight increase from last report.
Black Sea: Trader-to-trader business is stepping up. Sources report the prices have edged into the low $300s/mt FOB. Business was reportedly done at that level, but one trader said it was not necessarily for an end user.
Reconciling the current Black Sea price with what buying markets are willing to pay is tough.
Sources have reported Indian buyers sniffing around, looking for prices at $300-$305/mt CFR. Sellers say the selling price now starts at $310/mt FOB.
With China out of the equation for sales until July, buyers that return to the market will only have the Black Sea and Middle East producers to deal with. This situation, said one trader, could mean the price is unlikely to come down this semester.
With the trader-to-trader deals the only evidence of market movement at this time, sources peg the area market at $300-$310/mt FOB.
Middle East: The lower end of the market is moving up. The upper end is stagnant.
Sources report Fertil sold a cargo for about $320/mt FOB last week. Combining this deal with the previous Egyptian sale at $335/mt FOB, sources say upward pressure on the area market remains firm.
Demand for granular material has not abated. Longterm contracts and a few formula-based deals to buyers in Southeast Asia and Australia are keeping the producers happy.
The remaining prilled producers are also happy with the entries on their order books.
Sources report material keeps flowing.
Prices for granular are now pegged at $320-$335/mt FOB. The official prilled price remains right around $300/mt FOB because no new public business has been reported.
One trader noted, however, that if the market price reflected the traditional spread between granular and prilled urea, the prills would be at $310-$325/mt FOB.
China: An Asian source noted that a large quantity of urea remains in the bonded warehouses ready for shipment. The tons arrived in the bonded warehouses before the end of January. They are slated to be loaded on vessels in the next week or so.
Things will slow down in China – and most of Asia – this week as the lunar New Year approaches. The government of China has already declared a weeklong holiday for the New Year, which begins Feb. 14. Many in China will spend the days before the New Year traveling to visit family members. One trader noted that for all practical purposes China will be shut down later this week until the end of the month.
Indonesia: Sources report PIM sold a cargo late last month at $316/mt FOB. No other producer has permission to export material yet. PIM reportedly gets permission to sell offshore more readily because it needs the hard currency such sales earn to pay for its natural gas inputs.
In order to sell anything offshore, Pusri and Kaltim need to prove that their reserves are so large that they must sell. The companies are hard pressed to make such a case, because the country is in the middle of its main application season.
Vietnam: Sources report supplies are sufficient to carry the country through the upcoming application season.
Importers snagged enough tons before the Chinese export duty went up to ensure there was plenty of material waiting for local demand.
NITROGEN SOLUTIONS
U.S. Gulf: Prices were hard to gauge last week, with several players calling the market quiet or saying there was no prompt product to trade. Most put that market within the $190-$195/st FOB ($5.94-$6.09/unit) range. However, most sources kept talking about $210/st FOB, which was reported to be the target price for March.
Eastern Cornbelt: UAN remained at $7.50-$7.90/unit FOB regional terminals, depending on location. One Illinois source put the dealer market in his location solidly at the $248/st ($7.75/unit) FOB level last week for prompt tons.
Western Cornbelt: The UAN-32 market remained at $225-$255/st ($7.03-$7.97/unit) FOB regional terminals, depending on location and time of delivery. The upper end of the range was reported out of Missouri locations for prompt tons on a spot basis. One Iowa source put the dealer market in his location solidly at the $248/st ($7.75/unit) FOB level last week. Koch’s solutions postings FOB Beatrice moved on Feb. 2 to $210/st ($7.50/unit) for UAN-28 and $240/st ($7.50/unit) for UAN-32.
Southern Plains: The UAN-32 market was tagged at $225-$240/st ($7.03-$7.50/unit) FOB regional terminals, with the low out of spot production points. Koch’s Dodge City, Kan., postings moved on Feb. 5 to $240/st ($7.50/unit) for UAN-32 and $210/st ($7.50/unit) for UAN-28. One source pegged forward tons in the $245-$255/st ($7.66-$7.97/unit) FOB range, depending on time of delivery.
South Central: UAN-32 out of regional terminals was pegged in the $205-$220/st ($6.41-$6.89/unit) FOB range last week.
Southeast: Sources said the disconnect between dealer pricing and current replacement costs continued for UAN. Although vessel UAN-32 tons were indicated at the $250/mt CFR level for new sales, the UAN-30 market out of coastal terminals to the dealer was pegged as low as $195/st ($6.50/unit) FOB, with very little movement reported. The inland terminal market for UAN-32 was tagged in a broad range at $210-$222/st ($6.56-$6.94/unit) FOB last week.
Western U.S.: Effective Feb. 3, Agrium’s UAN-32 postings moved to $250/st ($7.81/unit) rail-DEL in Washington, northern Idaho, and Oregon excluding Malheur County; $255/st ($7.97/unit) rail-DEL and $260/st ($8.13/unit) truck-DEL in southern Idaho, Nevada, Utah, and Oregon’s Malheur County; and $270/st ($8.44/unit) DEL in Montana and northern Wyoming. In California, Agrium’s UAN-32 postings moved to $238/st ($7.44/unit) FOB Sacramento, $260/st ($8.13/unit) truck-DEL in central California, and $265/st ($8.28/unit) truck-DEL in northern California.
AMMONIUM NITRATE
U.S. Gulf: Ammonium nitrate barges have reportedly shot up. While some last week were casually referring to the market as $220-$230/st FOB, others said that those numbers have been passed on by and that $250/st FOB has been achieved. In the meantime, Terra was reported to have posted $265/st FOB Yazoo City.
Western Cornbelt: Ammonium nitrate was quoted at $280-$290/st FOB, with the low FOB Springfield, Mo., and the upper end in Iowa to the dealer.
Southern Plains: Ammonium nitrate was tagged at $265/st FOB the Tulsa market.
South Central: Ammonium nitrate was quoted at $265-$275/st FOB, with the low reflecting updated postings out of regional production points and the upper end FOB terminals in Tennessee and Arkansas.
Southeast: The Tampa ammonium nitrate market was quoted at $280-$290/st FOB. A Carolina contact quoted rail-delivered nitrate at the $298/st level last week.
AMMONIUM SULFATE
Eastern Cornbelt: Granular ammonium sulfate had reportedly firmed to $218-$230/st FOB or DEL, depending on supplier. Honeywell’s Feb. 1 postings included granular ammonium sulfate at $230/st rail-DEL and FOB warehouses in Illinois, Wisconsin, Iowa, Missouri, Minnesota, and Nebraska. Mid-grade sulfate postings moved on that date to $215/st rail-DEL or FOB. The company noted in an email to customers that volumes are “extremely limited.”
Western Cornbelt: Granular ammonium sulfate was tagged in a broad range at $210-$230/st FOB in the region, but the low end was likely to ratchet up in the wake of the higher postings from Honeywell.
Southern Plains: Granular ammonium sulfate remained at $195-$235/st FOB Texas shipping points, with the low at Freeport.
South Central: Granular ammonium sulfate was quoted at $195-$210/st FOB, but sources said the market is firming in the wake of higher postings and tight supply. “It’s a little tight, but it is every year at this time so I wouldn’t expect anything else,” said one. “It’s just business as usual.” Honeywell’s Feb. 1 postings included granular ammonium sulfate at $230/st rail-DEL and FOB warehouses in Arkansas and Mississippi, with mid-grade sulfate posted at $215/st rail-DEL or FOB.
Southeast: Granular ammonium sulfate was up from last report at $190-$200/st FOB, with the low at Hopewell, Va., and the upper end reflecting new postings FOB Augusta, Ga. Delivered granular sulfate was quoted in the $215-$225/st range in the region. Standard grade ammonium sulfate postings from DSM Chemicals were slated to move up $11/st on Feb. 8 to $156/st FOB Augusta and $184/st DEL in Florida.
PHOSPHATES
Central Florida: While the other major markets slowed last week, prices at Central Florida were on the increase.
Although the phosphate markets bloomed during the past several weeks, producers have not been able to crank up production due to shortages of sulfur. That situation was likely to continue during the quarter, and, if demand runs up during the spring season, will affect phosphate prices. Sulfur was forecasted by some to continue to be short until sometime in the third quarter, so another price increase for the second quarter appeared likely.
Phosphate will probably be a focus at TFI’s meeting in Orlando, which starts up Feb. 7.
The Central Florida DAP price range changed last week from $380-$390/st FOB the previous week to $390-$400/st FOB. Large buyers could expect to pay the lower price or even $5/st FOB higher, while smaller buyers will pay at least the high end of the range. Mosaic increased its posted price to $395/st FOB, and CF was expected to seek about the same. PCS Sales was charging market-based prices. Agrifos was increasing its prices to $430/st FOB for DAP and $440/st FOB for MAP, but railcars were about $5/st FOB less, if available.
U.S. Gulf: Both the amount of phosphate traded and the price rise slowed last week, as some dealers were holding off making purchases due to the higher price. However, it was likely the cold and wet weather also had an impact on sales. Phosphate inventories remained low, and that situation will probably not change unless producers can find additional supplies of sulfur, regardless of whether the spring season is early or late.
MAP has been very difficult to find for several months, but a barge was traded last week at $425/st FOB NOLA. That may have come from a Russian vessel that had either just arrived or was about to do so.
Warehouse prices for DAP were running from $425/st FOB at the low end to as high as $450/st FOB at some northerly locations. Dealers should expect prices to rise at terminals due to the higher prices for NOLA phosphate barges.
The up tick in prices stalled last week but still increased at the bottom end of the range, and the top of the range remained flat. A week earlier, sellers had been seeking $420/st FOB, but last week most were only asking $415/st FOB. Most think the price will continue to rise as the spring season arrives and orders increase.
Based on transactions last week, the NOLA DAP barge price range was $410-$415/st FOB, compared to $405/$415/st FOB. Expect some deals to be done at the TFI conference in Orlando this week.
Eastern Cornbelt: DAP remained at $435-$445/st FOB regional warehouses, with MAP $10-$15/st higher. 10-34-0 was steady at $350-$365/st FOB in the region.
Western Cornbelt: DAP was steady at $430-$445/st FOB regional warehouses. MAP was priced at a $10-$15/st premium to DAP and remained in particularly tight supply. One Missouri supplier tagged the dealer market last week at $440/st FOB for DAP and $455/st for MAP out of his locations.
10-34-0 remained at $345-$355/st FOB in the region. Agrium’s phosphoric acid postings firmed on Feb. 1 to $725/st rail-DEL for both super phosphoric acid (SPA) and merchant grade acid (MGA) in Iowa, Minnesota, Nebraska, the Dakotas, and Wyoming.
Southern Plains: One source reported some phosphate and potash movement in his location last week, while another said activity was underway in only one of numerous locations in eastern Kansas. “We’re kind of in the field,” he said. “We can go till mid-afternoon and then it gets slick, but we’re getting something done and that’s a plus.”
DAP pricing had firmed to $435-$440/st FOB the Tulsa market, with MAP quoted at $450-$460/st FOB the port. 10-34-0 was reported at $330-$335/st FOB in the region, also up from last report. Agrium’s phosphoric acid postings moved on Feb. 1 to $725/st rail-DEL for both SPA and MGA in Colorado, Kansas, New Mexico, Oklahoma, and Texas, up $35/st from January pricing levels.
South Central: DAP out of regional warehouses was pegged in the $425-$435/st FOB range last week, with MAP $10-$15/st higher. The TSP market was quoted at $385-$400/st FOB. One source said the higher DAP and MAP numbers have cooled interest at the dealer level. “That puts the cost to the farmer at close to $500, and that starts to make them think about it,” he said. “They’re not going to cut out phosphate, but they are going to cut back. Just get what they need and no more.”
Western U.S.: Effective Feb. 1, Agrium’s phosphoric acid postings firmed to $785/st rail-DEL for both SPA and MGA in Arizona, California, Idaho, Montana, Nevada, Oregon, Utah, and Washington.
U.S. Export: PhosChem made only one export sale last week, which was said to be a small load into Mexico at $465/mt FOB. As of last week, the export market was paying a premium to the domestic markets.
Latin America continued to be a promising market for U.S. phosphate producers last week, including Brazil, Argentina, and Mexico. In addition, Venezuela issued a tender seeking 20,000 mt last week. Pakistan was also said to be likely to go into the market sometime soon.
The export DAP price range last week increased from the previous week’s $455-$470/mt FOB to $465-$470/mt FOB. The trend has been higher for the past month, and that will likely continue.
China: Sources report the latest price offer in China is $510/mt FOB. Sources report tons are sitting in bonded warehouses, with vessels lined up for shipment to Latin America.
Industry watchers are expecting the price to hold in the mid-$500s/mt FOB into June. After July 1, the export duty will drop to 7 percent again. Sources say there could still be enough demand that buyers might be willing to pay up to $550/mt FOB.
Vietnam: Asian sources report buyers earlier were looking for tons around $430/mt CFR. They are now being told that $560/mt CFR is the best anyone can do.
India: Demand remains strong. Sources report that there is still some confusion about how the government will implement the new nutrient-based subsidy.
Sources say NPK makers are looking to import DAP directly for their blending facilities. At the same time, DAP users want tons for direct application. All are wondering how they will receive payment and how much they will receive under the new plan.
To add more trouble to the situation, sources report that IPL and IFFCO are looking around to import about 1.5 million mt as soon as possible.
Only three sources work for India: Tampa, Russia, and Jordan. Sources say the continued strength in the Tampa market is making life difficult for buyers looking for a deal.
POTASH
U.S. Gulf: The barge market, which was being called $360/st FOB just a few weeks ago, is now being quoted at $375/st FOB. Sources say this reflects the demand after major domestic producers dropped prices back in January.
Eastern Cornbelt: Potash was generally quoted at the $405/st FOB level on the low end from wholesalers and secondary suppliers. One source said his company had moved the price up midway between the January price of $390/st and the $420/st FOB level originally slated for March 1. Agrium moved its 60 percent red premium potash postings up on Feb. 2 to $420/st FOB and $430/st rail-DEL in the region.
Western Cornbelt: Sources continued to report granular potash from some secondary suppliers at the $390/st FOB level on the low end last week, but others had moved up. One Iowa source put the dealer market in his trade area at $405-$415/st FOB for prompt and $430/st FOB for spring, while a Missouri contact quoted new dealer pricing in his trade area at $410/st FOB for red granular and $417/st for white granular. Agrium’s 60 percent red premium potash postings firmed on Feb. 2 to $420/st FOB and $430/st DEL in the region.
Southern Plains: Potash remained at $360-$368/st FOB Carlsbad, N.M., depending on grade. Out of regional warehouses, sources said the dealer market had firmed to $400-$410/st FOB. Agrium’s 60 percent red premium potash postings firmed on Feb. 2 to $430/st rail-DEL in Kansas, Oklahoma, and Colorado.
Effective March 1, postings from Intrepid Potash FOB Carlsbad will firm to $385/st for 60 percent standard, $390/st for 60 percent granular, $392/st for 62 percent standard, $395/st for 62 percent fine standard, and $398/st for 62 percent granular. The company’s postings FOB Moab and Wendover, Utah, will firm on that date to $385/st for 60 percent standard and $390/st for 60 percent granular.
South Central: Potash was pegged at $390-$400/st FOB regional warehouses. Agrium’s rail-delivered red premium potash postings firmed on Feb. 2 to $440/st in Kentucky and Tennessee. Whether or not producers will hold to the higher numbers was a point of debate. “We have enough product in our warehouse to carry us deep into spring at the previous levels,” said one source.
Southeast: Sources quoted the potash market at $440/st rail-DEL and $427-$430/st FOB warehouses to the dealer, reflecting an increase of roughly $30/st from last report. Agrium’s rail-delivered red premium potash postings firmed on Feb. 2 to $440/st in Virginia, Alabama, Georgia, Florida, and the Carolinas.
Brazil: BPC has raised its prices by $25/mt, and now expects a minimum price of $425/mt CFR for granular for large buyers, with smaller buyers paying $435/mt CFR.
Asia: BPC is moving its prices in the region up by $25/mt, from $385/mt CFR to $410/mt CFR. Granular moves to $425/mt CFR.
SULFUR
Tampa: After sulfur and phosphate producers agreed to the new $90/lt molten-to-Tampa price for the first quarter last week, supplies continued to tighten. On the world market, the upward trend was expected to continue until sometime midyear.
The U.S. DOE said refineries were producing at only 77.7 percent of capacity last week, and crude reserves were building. The recession continued to be the major cause of the slowdown in production. Oil company revenues were down, but still high compared to most industries. Refinery operations were working on much more narrow margins.
Despite the higher prices for sulfur, that situation was still expected to reverse later this year, as new sources were coming online – such as in Saudi Arabia. China, one of the world’s largest consumers, was rumored to be preparing to begin sulfur extraction from its sour gas operations. Suncore, the oil-sands operation in Canada, was believed to be back in operation, which could help ease the supply situations in some cases.
Valero sold eight railcars of molten sulfur from its shuttered Delaware City refinery to a buyer for delivery to Ohio by rail at $150/lt DEL. The sale was the last of the sulfur the company had available at that refinery.