U.S. Gulf:
NOLA prompt potash barge prices spanned a broad range during the week. Sources quoted a range of $263-$285/st FOB, reflecting a quick run up after producers announced increases in postings.
While some called the market a firm $285/st FOB as of late Thursday, others were skeptical that those numbers would be the floor for the next round of trading.
U.S. Imports:
August potash imports were up 7 percent, to 1.22 million st from the year-ago 1.14 million st. July-August imports were up 14 percent, to 2.44 million st from 2.15 million st.
Eastern Cornbelt:
The low end of the Eastern Cornbelt potash market had reportedly inched up to $300-$305/st FOB spot river terminals, while inland warehouses were reported firmly in the $310-$320/st FOB range for new sales. Although producer postings are now in the $320-$330/st FOB range in the Midwest, sources said the producer price increases “haven’t fully hit” yet.
Western Cornbelt:
Potash was quoted in a broad range at $295-$320/st FOB in the Western Cornbelt, with the low reported out at Muscatine and Caruthersville and the upper end at inland warehouses. Sources pegged the St. Louis market at $300-$310/st FOB at midweek, while pricing at St. Joseph and Kansas City, Mo., was reportedly firm at the $315/st FOB level.
Southern Plains:
Potash pricing was quoted at a firm $300-$315/st FOB Catoosa/Inola, pushed up by higher producer postings in early October. Intrepid on Oct. 4 announced a $25/st potash pricing increase, with postings for new orders at Carlsbad, N.M., firming to $337/st FOB for 62 percent standard grade and $330/st FOB for 60 percent granular.
South Central:
Potash pricing in the South Central region was tagged at $295-
$300/st FOB warehouses, with the lower end in Arkansas and the high at Memphis for new sales. “We haven’t achieved the $320/st posted number on potash yet, as there is no liquidity in the markets due to weather and the slow harvest,” said one regional contact.
Southeast:
Potash pricing was up significantly in Southeast, with sources quoting new offers at $350-$355/st rail-DEL for Canadian tons, and $325-$335/st FOB port warehouses at Wilmington and Charleston, S.C.
China:
Arab Potash Co. (APC) and Israel Chemicals Ltd. (ICL) this week settled new potash supply contracts with China. APC on Oct. 7 said it had concluded a new supply deal with Sinochem Macao for the delivery of about 600,000 mt, including optional quantities, which will be shipped “during 2018 and part of 2019.” The volumes agreed to are down from last year when about 700,000 mt of various grades were concluded, although last year’s contract settlement came earlier, in late July.
The Jordanian producer said the terms and conditions are in line with current market prices and terms. Belarus Potash Co. (BPC) was the first supplier to settle a new seaborne contract price with China on Sept. 17, agreeing to a new price of $290/mt CFR with China’s buying consortium, comprising Sinochem, CNAMPGC, and CNOOC, for deliveries through June 2019. It has been past practice for other suppliers to subsequently settle their seaborne supply contracts at the same price with China as the first supplier to reach a deal.
APC said the expected financial impact of the new China supply deal on the company before income tax, royalties, and production costs is around JD125 million (approximately $176.3 million) spread over the years 2018 and 2019 based on the shipping schedule.
While there has been no official confirmation from the company, ICL late this week was reported to have signed several contracts with its customers in China to supply an aggregate 905,000 mt of potash, with mutual options for an additional 375,000 mt, to be shipped in larger quantities per shipment, by the end of June 2019, according to a Bloomberg report. The selling prices stipulated in the contracts are reported to be at a $60/mt increase on last year’s contracts and in line with the recent contract price settlements in China at $290/mt CFR.
ICL’s new contracts are part of the three-year framework agreements between the Israeli company and its Chinese customers, according to Bloomberg, citing the Israeli supplier.
There is still no official word from either Canpotex or Uralkali on whether they have settled new seaborne supply contracts here. BPC has not disclosed the delivery volumes agreed under its new contract.
India:
No official word has come from Canpotex or Uralkali on whether they have finalized contract negotiations with Indian Potash Ltd. (IPL) and their other Indian customers. They, in addition to K+S, are the remaining suppliers to confirm new supply contracts with India.
Similarly, turning to recent tender business, RCF has yet to make an award under its tender for 275,000 mt of standard potash, according to a source at the company. The tender, which closed on Sept. 24, calls for 105,000 mt firm and 170,000 optional tons. The business attracted three offers from BPC, IPL, and MMTC. No details of offer prices have been heard, but sources say the Indian buyer is unlikely to entertain prices above the new contract settlement price of $290/mt CF. Offers are required to remain valid for 30 days from opening.
As previously reported, sources believe National Fertilizers Ltd. (NFL) has scrapped its tender for 2×30,000 mt of white or dark pink standard potash, which closed on Sept. 18, although this could not be confirmed with the Indian buyer (GM Oct. 5, p. 16).
According to a company source, only one offer was received. Under the tender, shipment from load ports was required no later than Oct. 30.
Northwest Europe:
Tight availability and brisk demand are reportedly putting granular prices under upward pressure, but sources continued to peg the current range at €285-€290/mt CIF Northwest Europe.