U.S. Gulf/Tampa:
Most sources see the Tampa price as under pressure for June. Citing softer international prices, they speculate it could come off $300-$400/mt CFR from May’s $1,425/mt CFR.
Eastern Cornbelt:
Reference ammonia prices remained at $1,450-$1,475/st FOB Eastern Cornbelt terminals during the week, with the low reported in Illinois and Indiana and the high at Lima, Ohio. Sources said prices were under pressure and “negotiable,” however, with sales confirmed at $1,400/st FOB in the region.
Sources said preplant ammonia movement was essentially over in the region, as efforts now focus exclusively on planting. Estimates were of at least a 20% reduction in preplant volumes from normal due to a range of factors, including the delayed start, a robust fall application season, and some price resistance at the retail level.
Western Cornbelt:
With preplant demand winding down in the region, sources said ammonia terminal prices were under pressure. The Western Cornbelt market continued to fall in the $1,355-$1,450/st FOB range, depending on location, with the low reported at Port Neal, Iowa, and the high at Palmyra, Mo.
“Application is definitely behind due to weather,” said one Missouri contact at midweek. “Some spotty application is going this week, but we’re still having pop-up thundershowers, with more expected today.”
Southern Plains:
Ammonia pricing in the Southern Plains slipped to $1,200-$1,300/st regional production points, down $25-$50/st from the last reported offers, with the low quoted at Enid, Woodward, and Pryor, Okla., and the high at Coffeyville, Kan.
“I’m expecting a fill announcement yet this month from one of the manufacturers,” said one regional ammonia contact. “First out gains that much needed tank space. How aggressive will it have to be to get dealers/farmers to bite?”
South Central:
Sources continued to quote truck offers for anhydrous ammonia at $1,300/st FOB Louisiana production points and $1,400/st FOB Cherokee, Ala. No prices were reportedly being offered at El Dorado, Ark., or Midway, Tenn.
Black Sea:
The lack of access to Ukrainian ports prevents any efforts to deal with ammonia pricing from the area. Sources said there is no way to calculate from other sources what the price would be because vessels are not allowed into the war zone.
India:
Sources said the only material flowing into India so far has been cargoes contracted earlier or those under price-formula agreements. The lack of spot tons leaves the price just above $1,100/mt CFR.
Sources said demand for ammonia from DAP producers is limited because it is currently more expensive to produce DAP in India than to import the product. As a result, ammonia imports seem to be primarily going to industrial buyers with only a portion going to DAP production.
Middle East:
Producers will tell anyone who asks that there are no spot tons available. At the same time, however, sources reported some vessels being loaded that appear to be outside usual long-term deals.
There are reports that a couple of vessels are being loaded by Trammo under what sources call price-formula deals. Sources put the price for these cargoes at $950-$1,000/mt FOB, which is about where potential buyers are also calling the spot market.
A softness in the global ammonia market has led buyers to be more aggressive in demanding lower prices. Sources said nothing will be completed from the Arab Gulf over $1,000/mt FOB because of this.
Northwest Europe:
Sources said the current market is pegged at $1,200/mt C&F based on the estimated break-even price for European-produced ammonia and on recent OCP purchases.
The price to produce one ton of ammonia is now reported at $1,100 because of the high cost of natural gas. Some deals are able to be done at this level, said traders, but there is a growing effort to push back against further increases. The major obstacle to lower prices remains the high price of natural gas. Sources said at a certain point producers cannot give any more concessions to buyers without losing money.
Recent purchases by OCP, when calculated back to a Northwest Europe-equivalent price, confirms pricing around $1,200/mt C&F. Sources warned, however, it is difficult to impose prices from one region on another in the current market. Many of the traditional price relationships have fallen aside under new trading patterns and volatile markets for inputs, such as natural gas.
North Africa:
Phosphate giant OCP has so far been able to make up for the ammonia it no longer gets from the Black Sea. At the same time, it is also able to stem rising prices and push some levels down.
Sources said the price into Morocco is now pegged at $1,070-$1,080/mt CFR. This past week reportedly included at least one deal from Egypt. This vessel is slated to ship within the next week or so. Already on their way to Morocco is a vessel from Argentina and another from Donaldsonville, La.
At the same time, sources reported OCP agents are once again talking with Kaltim about a cargo for June loading.
Southeast Asia:
Indonesia is accepting lower bids for its ammonia. Sources said a deal for 25,000 mt was done at $920-$930/mt FOB for an early June loading. This is down from the $1,125/mt FOB Kaltim was asking just three weeks ago in its selling tender.
Reportedly, buyers in Taiwan and South Korea are now paying $900-$1,000/mt CFR for their purchases. At the same time, these major buyers seem to be stepping back from their usual demand, forcing sellers to either build up reserves or accept lower prices right away.
Despite a current climate of softer demand, South Korean imports for the first four months of the year were up compared to the same period last year, according to Trade Data Monitor. Imports for January-April 2022 were reported at 527,000 mt, up 27% from the 472,000 mt brought in during the same period last year.
April 2022 imports were reported at 119,000 mt, up from the 92,000 mt imported in April 2021. The two suppliers to South Korea in April 2022 were Saudi Arabia with 65,000 mt and Indonesia with 53,000 mt.