U.S. Gulf/Tampa:
The October ammonia price stands at $665/mt CFR, up $50/mt from September. With more outages being reported in Europe and inland U.S. prices ratcheting up, Tampa prices will be under pressure to move up again in November.
U.S. Imports:
Imports of ammonia were up 11.7 percent for August, according to data released by the DOC, to 229,424 st from the year-ago 205,333 st. July-August imports were up 20.9 percent, to 424,311 st from the year-ago 351,016 st.
U.S. Exports:
Ammonia exports for August were down 81.8 percent, to 23,282 st from the year-ago 127,588 st. July-August exports were down 54.2 percent, to 91,571 st from 199,978 st during the same period last year.
Eastern Cornbelt:
Ammonia prices continued to ratchet higher in the Eastern Cornbelt. Nutrien moved its Lima, Ohio, ammonia price to $890/st FOB during the week, up from $735/st FOB the week before. After pulling prices the previous week, both Koch and CF reportedly reposted on Oct. 7 at $900/st FOB in Illinois.
Sources expect a heavy fall application pace for ammonia. “These guys will put on every pound of ammonia they can this fall because they got all their expected needs covered $250/st ago,” commented one source. “The long-term weather forecast looks good all the way through Thanksgiving.”
Western Cornbelt:
After offers were pulled late the previous week, Koch announced a new round of ammonia prices on Oct. 7 that included $885/st FOB Beatrice, Neb.; $890/st FOB Greenwood, Neb., and Sergeant Bluff, Iowa; $900/st FOB Iowa terminals at Garner, Fort Dodge, and Washington; and $910/st FOB Marshalltown, Iowa. Those levels were up roughly $100/st from the company’s previous postings on Sept. 30.
Southern Plains:
Ammonia prices were up significantly in the Southern Plains. Sources quoted pricing at $700-$735/st FOB regional production points early in the week, up from $650-$700/st FOB the week before. By midweek, however, sources reported new offers at Enid, Okla., at the $840-$850/st FOB level.
The truck market FOB Beaumont, Texas, was quoted firmly at the $650/st FOB level at midweek.
South Central:
The ammonia market remained at $620-$650/st FOB Gulf Coast terminals for truck offers in early October. Sources continued to report no current offers on the table at El Dorado, Ark., Cherokee, Ala., or Midway, Tenn.
Black Sea:
Small ammonia cargoes are still moving out of the area. The limited tonnage comes from plant closures in Ukraine because of rising natural gas prices and contracted Russian tons.
Sources reported a deal this week that moves the Yuzhnyy price to $710/mt FOB. Higher prices are likely for the limited tons that might still be available.
Middle East:
The lack of any spot deals keeps the Middle East ammonia price in the $620s/mt FOB. Sources said having a gap of nearly $100/mt between the Arab Gulf and Yuzhnyy is unusual, but that is the current situation.
Arab Gulf producers are fulfilling the demands of their Southeast Asian buyers, leaving nothing for the spot market. Sources said the movement of ammonia to the east is also leaving buyers west of Suez in a bind to find product from other sources. The lack of spot tons means Indian buyers that do not have long-term contracts are also searching for material, and often leaving empty handed.
Sources reported that the Ma’aden plant appears to be up and running, but it does not seem to be running at levels plant managers had hoped for. Whatever tons are being produced are being snapped up to use either for internal needs or to cover contracts waiting to be filled.
India:
Major ammonia buyers are having their contracts fulfilled, but the tightness of the global market means there are no extra tons for any spot deals. Sources also reported that in some cases producers are trying to invoke the portion of their contracts that allows them to ship 10 percent fewer tons with each cargo.
Indian DAP producers are facing an especially bad situation. As the contracts for ammonia come up for renegotiation, the buyers are seeing offers at ever-higher levels. Along with other inputs rising in price, the DAP producers are finding their production costs are exceeding the maximum retail price allowed in India.
If the producers decide they cannot turn out more DAP because of the high costs, the government will have to import the phosphate fertilizer. With China essentially closed, buyers will have to turn to other producers such as OCP/Morocco. However, sources said there does not seem to be an uptick in demand for ammonia from OCP to cover any new finished product purchases by India.
Northwest Europe:
Sources said the shutdown or reduced production of ammonia facilities across Europe due to high natural gas prices has pushed the Northwest Europe market to $800-$810/mt C&F.
Sources said there is still room for prices to move up, given the steady demand and higher natural gas prices. Buyers all seem nervous that a price correction will take a long time to reach, and when it does, the crash could hurt as many as the current run-up in pricing.
Sources reported a spot deal out of the Baltics at $720/mt FOB, well above the set price for October at $658/mt FOB. One trader said the move was not surprising, and the $720/mt FOB price will be used by producers when talks for November pricing come up.
North Africa:
Sources said China’s move to limit or block any DAP or MAP exports has led the Moroccans to step up production and ammonia demand. Reportedly, OCP has been slowly increasing its production to near capacity.
If the Moroccan phosphate giant wanted to dramatically increase production, sources said it would need to make a similar step-up in ammonia demand. So far, no such call for more product has happened. Sources said, however, there may soon be a call for more ammonia from outside the region as a political dispute between Algeria and Morocco spills over to commercial deals.
Reportedly, Algeria is ready to cut off natural gas to Morocco, which would also affect Spain and Portugal. In addition, ammonia traders said Algeria has already begun sending its ammonia to buyers other than OCP.
One beneficiary seems to be Tunisia, which is taking as much ammonia as it can find to help in its DAP production, which has reportedly stepped up.
Southeast Asia:
So far, demand in Southeast Asia is being met with material from the Arab Gulf. Sources said, however, that as the contracts come up for renewal, the buyers should expect to experience sticker shock.
Locally, Indonesian and Malaysian producers are turning out what they can as best they can, said sources. The PAU facility in Indonesia is showing signs of trouble in its re-starting efforts. Sources said the reason for the problems are not clear.
Brazil:
Ammonia imports for the first three quarters of the year were reported at 445,000 mt by Trade Data Monitor, representing a 41 percent increase from the same period in 2020.September imports were pegged at only 9,000 mt, down 81 percent from September 2020 imports of 51,000 mt.
Third-quarter imports this year were reported at 123,000 mt, down just slightly from the 126,000 mt reported for the same period in 2020.