US Gulf/Tampa:
Tampa ammonia remained at the $295/mt CFR level for August. Sources said the direction for September appears higher, however, amid curtailed production at Trinidad and Tobago due to gas supply issues and a new round of stronger inland postings for fall ammonia.
Eastern Cornbelt:
Ammonia prices strengthened in the Eastern Cornbelt at mid-month, moving to $485-$525/st FOB for prompt or fall prepay offers, up from the previous $465-$485/st FOB. The low was quoted at Lima, Ohio, with most new offers in Illinois and Indiana reported in the $500-$525/st FOB range.
Western Cornbelt:
Ammonia prices firmed to $500-$525/st FOB in the Western Cornbelt, up from last week’s $440-$475/st FOB, with the low confirmed in Nebraska and the high at Palmyra, Mo. New prompt and prepay offers in the Northern Plains were also reported firmly at the $500/st FOB level, up from the previous $475/st FOB.
California:
Ammonia remained at $580/st DEL in California, with aqua ammonia referenced at $159/st FOB Stockton and $169/st FOB Sycamore.
Pacific Northwest:
Anhydrous ammonia was quoted at the $460/st FOB mark out of regional terminals in the Pacific Northwest, with aqua ammonia referenced at the $120/st FOB level in mid-August. Sources said they expect an increase in the near-term.
Western Canada:
The last confirmed ammonia prices remained at C$810-$1,025/mt DEL in Western Canada for fall tons, but there were few offers on the table in mid-August.
Black Sea:
Turkish buyers continue to look for bargains. Sources said buyers are looking at Russian tons from the Baltic at prices below what North African suppliers have been offering.
A reported shortage of ammonia supply from Iran seems to have prompted the dispatch of an Iranian vessel to Venezuela to pick up some ammonia for Turkey. While there has been no record of Venezuelan ammonia reaching Turkey, sources noted reports that 2-3 cargoes have already been delivered to Turkish buyers from Venezuela. One trader said the product was most likely re-exported from a third country.
According to Trade Data Monitor, Turkey’s primary ammonia suppliers so far in 2023 have been Egypt, Libya, and Oman.
India:
Small buyers have been stepping up purchases, sources said, noting loads of 8,000 mt or less selling into India at $380-$385/mt CFR. Sellers are reportedly pushing for $390/mt CFR, but with little success.
The price paid for these smaller spot ammonia cargoes is significantly higher than what larger buyers pay under long-term contracts. Nailing down the contract price is difficult, however, as neither side is willing to reveal it.
Middle East:
The latest ammonia sales into India showed a netback of $320/mt FOB to the Arab Gulf, according to reports, matching the price achieved last week from a one-off deal involving shipments to Jordan and Morocco.
The spot price is too high for most buyers seeking large quantities, said one trader. Only buyers looking for small lots are accepting these higher prices. At the same time, producers say they are sold out well into September. Boasting full order books, said one source, the producers can demand any spot price they want.
The asking price of $320/mt FOB makes any spot deal into Southeast Asia impossible, said another trader. The current estimated contract price to buyers in Taiwan and South Korea is closer to $330/mt CFR, netting back well below $300/mt FOB to the Arab Gulf.
Supply is expected to pick up as Ma’aden and Muntajat plants slowly return to production, sources said. The extra tonnage is likely to pressure prices lower as demand remains lackluster, according to one trader.
Sources noted limited offers from Iran due to reported work stoppages. The lack of available export material has left some Iranian-owned ships with nothing to do. One vessel, said to be loading this week, was reportedly booked to pick up a cargo in Venezuela.
January-July ammonia exports totaled 352,000 mt, Trade Data Monitor reported, a roughly 25% increase from the year-ago 281,000 mt. India accounted for 88% of the exports with 311,000 mt, followed by Turkey with 25,000 mt. July exports of 2,800 mt, all to Turkey, were down from 39,000 mt in July 2022.
Sources said the gas shortage imposed on nitrogen producers by the government seems to have impacted some exports. Fertiglobe reportedly had an issue fulfilling a sale to Jordan and OCP earlier in the month. The company’s maneuvering to cover the deal led to a higher price out of the Arab Gulf, said sources.
While the price was thought to be a one-off at the time, new deals into India have since locked in the same $320/mt FOB price.
Northwest Europe:
Citing limited demand, sources described ammonia production as low and slow, but steady. Larger buyers are getting cheaper ammonia from imports, while smaller buyers are taking what they need on a hand-to-mouth basis.
Sources said the larger imports come in at $350/mt CFR, while some of the smaller buyers are paying $370/mt CFR. European producers are reportedly selling at $380/mt CFR.
Industry watchers are beginning to calculate what winter might look like for them. The erratic weather patterns that have plagued the year so far have suggested a handful of possible scenarios.
If winter starts early and with a severe cold snap, many in the industry might panic out of fear the record-level gas reserves could be affected, one source said, and may agree to future purchases at high price levels. On the other hand, if the season starts with mild weather, producers could get complacent about supplies and be caught flat-footed should harsh conditions arrive near the end of the season.
Southeast Asia:
The current contract ammonia price in the area is estimated at $330/mt CFR, netting back well below $300/mt FOB to the Arab Gulf. At these prices, the current $320/mt FOB spot price from the Arab Gulf of is not playing well with potential buyers.
Indonesian ammonia exports were 836,000 mt in January-June, according to Trade Data Monitor, a16% decline from 996,000 mt shipped in first-half 2022. China received 246,000 mt, South Korea took 214,000 mt, and Taiwan bought 96,000 mt. Second-quarter sales were reported at 459,000 mt, down 11% from 518,000 mt in the prior year.
Indonesia sent 137,000 mt offshore in June, off 18% from 168,000 mt in June 2022. South Korea and India each took about one-third of the June tonnage, while Australia, a new buyer of Indonesian ammonia, took 25,000 mt.