US Gulf/Tampa:
As many expected, Tampa ammonia prices dropped in May. Pricing for the month concluded at $380/mt CFR, down 12.6% from April’s $435/mt CFR.
Eastern Cornbelt:
Ammonia pricing was unchanged at $575-$600/st FOB in the Eastern Cornbelt, with the low confirmed in Illinois and the high in Indiana and at Lima, Ohio. Sources said the preplant application pace was slowed by wet conditions and cold temperatures in late April, with the southern Illinois market still anticipating heavy ammonia movement in the coming weeks.
Western Cornbelt:
Ammonia remained at $500-$525/st FOB terminals in Nebraska and Iowa, depending on location.
Southern Plains:
Ammonia prices remained in the $500-$515/st FOB range out of Oklahoma production points, with recent business out of Beaumont, Texas, quoted at the $475/st FOB level. Sources speculated that serious buyers could easily find tons under the $500/st FOB mark in Oklahoma, however.
South Central:
Truck offers for ammonia remained at the $400-$435/st level FOB Gulf Coast terminals. Other terminal prices included $450/st FOB Hopewell, Va., and $525/st FOB Cherokee, Ala.
Black Sea:
The main ammonia activity in the Black Sea consisted of purchases by Turkey at $330/mt CFR. The steady buying of ammonia by major Turkish customers has provided the market with a touchstone for calculating prices to Northwest Europe and the Arab Gulf at a time when those two markets have shown limited spot sales.
Sources estimated the Northwest Europe price in the $350s/mt CFR, based on the recent sales into Turkey, while the Arab Gulf-equivalent price would be just under $250/mt FOB. While none of the spot sales into Turkey are from either location, sources have been running back-of-the-envelope figures to speculate on where prices might be moving in those markets.
The material in the recent sale to Turkey was originally identified as Iranian product. Sources later said it was most likely Venezuelan, noting that a vessel bound for Turkey may have made a stop in Venezuela before heading east.
India:
Buyers are pushing for $300/mt CFR spot purchases. Some small lots from Indonesia have reportedly come in at that level, but sources could not confirm actual sales. Most of the ammonia coming into India is doing so under contract, with formula-based pricing that leaves figures well below spot prices.
The last publicly-acknowledged spot sale occurred several weeks ago at $350/mt CFR, but sources said that price is now too high for any buyer to consider. The best new price estimate for spot deals stands at $290-$310/mt CFR. One trader called this range the most rational price for the current market.
January-February ammonia imports totaled 482,000 mt, Trade Data Monitor reported, up about 77% from the year-ago 272,000 mt.
February imports were 276,000 mt, an 82% increase from 152,000 mt imported in February 2022. The three largest suppliers were Saudi Arabia with 80,000 mt, Bahrain with 55,000 mt, and China with 54,000 mt.
Middle East:
Sources said Arab Gulf producers were focusing on their contract sales, and not offering tonnage to the spot market. One of the reasons that producers are shunning the spot market, said one trader, is because of aggressively low bids from potential buyers.
Buyers looked at prices paid by Taiwan and India for Indonesian ammonia and calculated the Arab Gulf spot price at $245-$250/mt FOB, below where producers are offering in the $260s/mt FOB.
The price is expected to remain soft. Despite the shutdown of one Saudi plant for routine maintenance, sources said that most producers have returned to production. The supply of ammonia is said to be building in the region, with producers leaning on contract buyers to take as many tons as possible.
Buyers in Asia, however, have been pushing back against taking more than they need. The current economic situation is not encouraging for increased ammonia purchases by Asian manufacturers, said one trader.
Northwest Europe:
Even with a drop of $50/mt, the new Tampa price of $380/mt CFR was seen as too expensive for Northwest Europe. Sources said the Tampa price equates to about $410/mt CFR into Europe at a time when sources are calling the market $350-$360/mt CFR.
The estimated price, said one trader, comes from calculating the cost back from deals into Turkey at $330/mt CFR. While the two markets are not connected, the lack of any new spot business in Northwest Europe has led some to use prices gleaned from other markets to calculate what the price should be, based on those markets.
Even with natural gas prices falling, sources said the price of ammonia from European plants is too expensive for most buyers. The ex-plant price was pegged in the mid-$400s/mt. The availability of ammonia in the mid-$300s CFR from offshore sources has potential buyers looking at getting their ammonia needs from imports.
Southeast Asia:
The $300/mt CFR paid by CPDC in Taiwan for Indonesian material may indicate the price floor in the region. Just prior to the Taiwan deal, China bought ammonia at $320/mt CFR, but is now looking at replicating the $300/mt CFR price.
Pricing below $300/mt CFR in the area could make it difficult for both China and Indonesia to continue to export product. Sources said trading beneath that level comes close to breaking below the product’s production cost.
China remained a strong importer and exporter of ammonia for January-March. Trade Data Monitor put imports at 105,000 mt for the period, up 32% from 80,000 mt brought in during the first three months of 2022. January-March exports totaled 126,000 mt, up from 393 mt recorded during the first quarter of 2022.
March imports were pegged at 50,000 mt, with 49,000 mt coming from Indonesia. China imported 17,000 mt of ammonia in March 2022. Exports for March were 24,000 mt, compared to 393 mt in the prior-year period. Thailand took 15,000 mt, and Vietnam bought 9,000 mt.