U.S. Gulf:
Granular urea barges moved up early in the week to trade as high as $439/st FOB, but had retreated to $429/st by late Thursday. Still, overall prices were up from the week-ago $415-$432/st FOB. As the week progressed, sources said it was harder to find homes for new barges.
U.S. Imports:
May urea imports totaled 590,146 st, down 26.8 percent from the year-ago 806,123 st. Imports totaled 4.70 million st in the July-May period, however, a 2.1 percent year-over-year increase from 4.60 million st.
Qatar retained the top import spot for the fertilizer year-to-date with 1.24 million st, a 3.6 percent decrease from the year-ago 1.29 million st. Russia boasted 959,424 st for the period, rising 54 percent from the year-ago 623,152 st. Saudi Arabia sent 658,281 st to the U.S., up 13.9 percent on its the prior-year 577,894 st total.
U.S. Exports:
July-May urea exports totaled 721,131 st, up 22.1 percent from the year-ago 590,581 st. May exports totaled 38,462 st, falling 36.2 percent from 60,312 st in the prior year.
Eastern Cornbelt:
Urea pricing remained at a firm $475-$490/st FOB in the Eastern Cornbelt, with the low confirmed at East Dubuque and Ottawa, Ill., and the high at Cincinnati, Ohio.
Western Cornbelt:
The urea market slipped to $460-$480/st FOB in the Western Cornbelt, with the low confirmed at Port Neal, Iowa. The St. Louis, Mo., market was pegged in the $470-$480/st FOB range, with the last offers FOB Camanche, Iowa, reported at $475/st. Urea pricing FOB Catoosa/Inola, Okla., remained firmly at the $495-$500/st FOB level in early July.
Northern Plains:
The urea market was quoted at $470-$480/st FOB St. Paul, Minn., down slightly from the prior week. Delivered urea in North Dakota was also lower at $490-$500/st in early July, down from the last reported range of $500-$515/st.
Northeast:
The urea market remained at a firm $490/st FOB Fairless Hills, Pa., for July-August tons, with the East Liverpool, Ohio, market pegged at $485-$490/st FOB in early July.
India:
Despite four tenders so far this year, the country is still behind in the amount of urea it should have on hand. Initial estimates suggested India should have about 4.5 million mt from these tenders. Instead, so far only 2.7 million tons have been booked.
Sources said the combination of higher prices and limited supplies have kept the Indian buying houses from getting the necessary tonnage. The result is that more tenders will have to be called more frequently.
International traders said they expect to see another tender called as early as next week. After that, said one source, the market could see an Indian tender every three to four weeks for the rest of the year.
The appointment of a new minister for fertilizer could lead to a shakeup of authorized urea importers, said one international trader. Likewise, said another source, the leadership of some of the state-owned industries, such as MMTC and IFFCO, might also be realigned under the new national government leadership.
China:
Demand in the domestic urea market is waning as the season winds down. Sources said the export-equivalent price is now in the mid-$440s/mt FOB. The drop in the domestic price, said one trader, is more a result of the season ending than of government efforts to get lower prices for the farmers.
Seasonal demand usually takes a break in July and August, and then picks up in mid-September. Sources said regional distribution centers have plenty of stockpiled urea ready for September demand.
While the domestic price has gone down, sources said the actual export price is still strong.Granular urea for export is now being quoted at $490/mt FOB, but sources said there is no confirmation that any deals have been done at that level. International traders still peg the market in the mid-$470s/mt FOB for both prilled and granular urea.
One trader said the $490/mt FOB expectation of sellers could most likely happen in the next Indian tender. Sources said stockpiles at the export facilities are not very high, and many of the tons are already committed to servicing the most recently closed Indian tender.
If another tender is called soon, as is expected, sources said it will boost demand for product from China. The issue will be if there are enough tons available to cover the needs of the Indian buyers.
Black Sea:
Sources said at least a couple of cargoes from the Black Sea will be part of the awards issued in the RCF urea tender. That would put a netback to Yuzhnyy at $440-$450/mt FOB.
Middle East:
Supplies from the Arab urea producers remain limited. Sources said there are enough tons available to cover awards from the RCF/India tender, but not much more for any spot business.
Sources said the price remains at $505/mt FOB for now, based on the Indian business. Reports of material going at $510/mt FOB proved to be unfounded. Even so, producers continue to argue that $510/mt FOB is the new floor for any talks about new cargoes.
Egyptian producers have been busy this week. Abu Qir closed a tender on July 8 for 15,000 mt of prilled urea. When bids did not reach a level to the producer’s liking, the company scrapped the tender. Sources said Abu Qir did not reveal any of the prices submitted in the tender, nor what they considered to be their reserve price.
Separate from the tender, Abu Qir sold 30,000 mt of prilled urea for August shipment at $465/mt FOB. This price fits with the $475/mt FOB paid for granular product last week.
Prices are expected to remain firm out of Egypt. Sources said demand from Europe is expected to step up, as is regular demand from India in a series of tenders. There are also reports that an Alexfert plant is down for technical issues, with no word on how long the facility will be down.
The paper market in Egypt is reported at $477.50/mt FOB for July and August.
Indonesia:
Kaltim closed a tender on July 6 for 6,000-30,000 mt of granular urea. The producer wanted $490/mt FOB, but the highest bid came from Ameropa at $478.25/mt FOB.
| Bidding Company | US$/mt FOB |
| Ameropa | 478.25 |
| Liven | 478.00 |
| Samsung | 467.00 |
| Eurochem | 460.00 |
| Aries | 455.17 |
| Oracle | 453.00 |
Because the highest bid did not reach the reserve price, Kaltim scrapped the tender and entered into private talks. In the end, Ameropa agreed to a price of $479/mt FOB for the full 30,000 mt. Sources said the most likely destination for the urea is Australia.
Brazil:
Urea prices moved up slightly in Paranagua, to $495-$520/mt CFR. Sources said the stronger market was in reaction to the general global situation, as well as to limited availability at the port. More material is slated to show up soon, according to shipping reports.
The price in Rondonopolis narrowed this week to $610-$625/mt FOB ex-warehouse, compared with last week’s range of $590-$700/mt FOB. The price shift was seen as part of a general consolidation of prices inland.
Buyers at a variety of locations within Brazil are reporting limited access to urea, with sales occurring on a case-by-case basis. At the same time, farmers are looking at barter rates that keep fluctuating, which creates uncertainty about how many tons to buy and how far forward to make those purchases.
Urea imports for the first half of the year were up 29 percent, to 3.5 million mt from 2.7 million mt during the same period last year, according to Trade Data Monitor. The main suppliers of urea so far this year are Qatar at 937,000 mt, Russia at 769,000 mt, Oman at 634,000 mt, Algeria at 366,000 mt, Nigeria at 226,000 mt, and Turkmenistan at 118,000 mt. Oman, which did not supply any urea in 2020, showed the largest ear-over-year growth
Imports in the second quarter were up almost 40 percent, to 1.5 million mt from 1.1 million mt in the 2020 second quarter. Oman led the way this year with 520,000 mt.