US Gulf:
NOLA urea barge business was reported in the $315-$330/st FOB range for July shipment, with August-September trades quoted in the $323-$330/st FOB range. Some speculated that $325-$335/st FOB is likely for the next round, citing thin supply at NOLA and stepped-up buying in international markets, including Brazil and the EU.
“Producers are well-sold forward and are now making September sales,” reported one contact. “I expect 3Q to remain firm.”
US Imports:
Urea imports fell 20.2% in July-May, to 4.58 million st from the prior-year 5.74 million st. Imports were up 27.7% in May, however, to 771,385 st from the year-ago 603,981 st.
Imports from Qatar totaled 1.13 million st in July-May, followed by Russia with 761,300 st and Saudi Arabia with 622,222 st.
US Exports:
May urea exports were reported at 36,610 st, a 77.2% decrease from the year-ago 160,879 st. July-May volumes were up 66.7%, however, to 1.34 million from the prior-year 804,319 st.
July-May exports to Canada totaled 629,806 st, followed by 112,100 st to Mexico. Poland bought 107,840 st.
Eastern Cornbelt:
Urea prices plunged to $380-$400/st FOB in the Eastern Cornbelt, down from $440-$480/st at last report, with the low confirmed at Cincinnati, Ohio, for limited supply.
Western Cornbelt:
Urea prices dropped to 360-$390/st FOB in the Western Cornbelt, down from last week’s $425-$460/st FOB range, with the low confirmed at St. Louis, Mo. The latest offers at Catoosa/Inola, Okla., were pegged in the $380-$390/st FOB range, down from the prior $430-$470/st FOB.
Northern Plains:
Delivered urea pricing in the Northern Plains fell to $375-$400/st for the latest offers, down sharply from the $500-$520/st DEL level reported in mid-June.
Northeast:
Urea was quoted at the $435/st level FOB Fairless Hills, Pa., with reports that inventories were nearly tapped out at Baltimore and Chesapeake, Va., in early July.
Eastern Canada:
The Eastern Canada urea market slipped to C$615-$660/mt FOB, down from C$635-$850/mt FOB in mid-June.
Black Sea:
Prilled urea prices jumped to $300-$320/mt FOB, up from the mid-$240s/mt FOB reported last week. The move, while more dramatic than recent increases reported from other markets, puts the price more in line with other producers in the global urea market.
India:
India remains on track to call another urea tender by July 17, sources said. National Fertilizers Ltd. (NFL) is expected to make the call.
Because Rashtriya Chemicals and Fertilizers Ltd. (RCF) fell short of its 800,000 mt purchasing goal in the last tender, sources speculate that NFL will have to make up for the shortage and bring in another 800,000 mt, for a total target of 1 million mt.
One of the reasons that RCF could not secure its desired tonnage was the low price it paid. Chinese producers refused to budge from their price, as they were able to get higher netbacks from a strong domestic market. There may still be limitations on Chinese product when the next tender is called, but as urea prices have been going up, sources expect that some Chinese urea might make up part of the tender offers.
The next Indian tender will face a bullish urea market. Prices have been edging up in every major producing country. The higher prices could free up tons that would not be offered at prices similar to the previous tender. However, there is still the issue of getting Chinese urea cleared by inspectors in time. If the new tender stipulates a short shipping period – as the RCF tender did – traders said they may be reluctant to seek Chinese product to offer.
With most Russian urea out of play because of logistics and the possibility that Chinese product might make a limited appearance, sources said the bulk of the tender requirements will once again come from the Middle East. Arab Gulf producers are pushing for higher prices each week.
Trade Data Monitor put January-May urea imports at 2.4 million mt, down 38% from the year-ago 3.4 million mt. May imports were reported at 439,000 mt, up from 278,000 mt in May 2022. Oman supplied 214,000 mt for the month, ahead of 69,000 mt from Russia. Bahrain sent 47,000 mt.
Indonesia:
Sources reported that Kaltim III is down for routine maintenance, and Kaltim V might follow due to a lack of sales. Urea exports from Indonesia have been nil since mid-June.
Sources initially attributed the limited June exports to a strong domestic market. Others, however, have pointed to an ongoing investigation into the pricing policies of Pupuk Holdings, the parent company for Indonesia’s urea producers. While some traders are optimistic that exports could resume in late July, others believe nothing will happen until there is a break in the investigation.
January-May urea exports totaled 489,000 mt, according to Trade Data Monitor, off 21% from the year-ago 617,000 mt. May exports rose to 213,000 mt, up from 146,000 mt shipped in May 2022, with Australia taking 80,000 mt, Mexico 33,000 mt, and Myanmar 25,000 mt.
Middle East:
Sources said the urea price has moved up to $315-$320/mt FOB, citing increased demand from Brazil and Australia.
Discussions have taken place in the low-$330s/mt FOB for August shipments, sources said, but without any confirming data. At the same time, sources noted an end-September deal brokered out of Oman at $350/mt FOB. Other September deals were rumored at a similar level.
If the price moves into the $330s/mt FOB as expected, the India tender will end up with prices in the mid- to upper-$340s/mt CFR, a big boost from the $280-$285/mt CFR level that India achieved in the last tender.
Sources reported sales out of Iran at $270/mt FOB late last week, just before the “official” price of $290/mt FOB was laid on the table this week. Sellers of Iranian urea now appear to be targeting the urea-hungry Brazil market. Two selling tenders may be called by the end of the month to set new pricing levels.
Iran exported 2 million mt in January-June, Trade Data Monitor reported, down slightly from the 2.2 million mt shipped in first-half 2022. Turkey dominated the market, taking 1.1 million mt, while the remaining tons were picked up by 23 countries receiving 200,000 mt or less.
Second-quarter exports stood at 1.4 million mt, down 8% from the 1.3 million mt recorded in April-June 2022. Turkey took 771,000 mt of Iranian material. June exports totaled 468,000 mt, up slightly from the year-ago 440,000 mt, with Turkey receiving 232,000 mt, followed by Sri Lanka with 149,000 mt.
Egyptian prices moved up again, with MOPCO and Abu Qir reporting sales at $375-$380/mt FOB. MOPCO started the rise in prices, selling two 5,000 mt cargoes at $375/mt FOB before Abu Qir came in with a sale of 20,000 mt at $378/mt FOB. The week closed with MOPCO moving 5,000 mt and 10,000 mt cargoes at $380/mt FOB.
China:
Sources reportedly spent most of the week trying to figure out what was happening in the Chinese urea market. Players noted increased domestic demand at a time when that market is traditionally quiet.
The movement has caused pricing ideas to shift upward. Prilled urea was pegged at $310-$315/mt FOB, with a goal of $320/mt FOB by next week. Granular was put at $320-$325/mt FOB, with discussions pushing to $330/mt FOB later in the week.
One source reported the results of a tender in Taiwan at $325-$326/mt CFR, for a netback to China of about $300/mt FOB. However, this same source said he could not see any offers at that netback, leading him to believe the winning offer was a short sale rather than an indicator of the current market.
Expectations that Chinese product might be considered in the upcoming India tender were dampened by reports that export inspections at China are unlikely to get faster. Sources had previously reported that the speed of the inspections – necessary to export urea – would be reduced to a week from the current 15-30 days. Sources now say there does not appear to be any effort to speed up the inspection process, nor in reducing the time needed to clear all of the required bureaucratic paperwork.
If the Indian tender is called in mid-July and has a long shipping date – into October, for example – some Chinese product might be considered for the tender. However, should the tender carry a shorter shipping window, such as a mid-September shipping date, traders will be too concerned that China’s clearance process may not conclude in time to meet the deadline.
Brazil:
Selling to Brazil has become the mantra of the global urea market. Prices moved up to $355-$365/mt CFR on stronger demand. Sources reported more offers coming in at the higher end of the range, with expectations that prices will continue to rise.
Rondonopolis prices moved up to $480-$515/mt FOB ex-warehouse. Sources said negotiations for Safrinha tons have stalled following reports of lower corn prices. The focus for buying appears to be on forward purchases instead of for immediate need.
Urea imports fell 9% in January-June, Trade Data Monitor reported, to 2.8 million mt from the prior-year 3.1 million mt. The tonnage was sourced from a diverse group of providers.
| Country of Origin | Quantity (mt) | % of Imports |
| Qatar | 523,000 | 19 |
| Oman | 506,000 | 18 |
| Nigeria | 449,000 | 16 |
| Russia | 419,000 | 15 |
| Venezuela | 329,000 | 12 |
| Algeria | 296,000 | 11 |
While Brazil has reported no imports from Iran so far in 2023, sources believe Iranian producers will attempt sales into Brazil in the second half of the year.
Second-quarter imports totaled 1.4 million mt, down slightly from the year-ago 1.5 million mt. June imports were 395,000 mt, off from 522,000 mt received in June 2022. Russia and Qatar sent 111,000 mt and 89,000 mt, respectively.