U.S. Gulf/Tampa: There was nothing new to report by way of prices for Tampa or NOLA. There was some suggestion that NOLA might be under pressure since Mosaic would not be needing all of the ammonia being produced at Faustina due to its cutback in DAP production.
Eastern Cornbelt: Eastern Cornbelt sources continued to quote the prompt ammonia market in the $690-$710/st FOB range last week, with reports of spring prepay offers at the $725/st FOB level or higher, depending on location and supplier.
Western Cornbelt: The ammonia market remained at $670-$700/st FOB for prompt tons in the region, with reports of spring prepay offered at the $720/st FOB level out of Missouri shipping points. Delivered ammonia was tagged at the $650/st mark in the Missouri market from southern production points.
California: Anhydrous ammonia was steady at $820-$825/st truck-DEL in California, with aqua ammonia referenced at the $219/st FOB level in the state.
Pacific Northwest: Anhydrous ammonia pricing in the Pacific Northwest had reportedly fallen by roughly $100/st from last report, with sources quoting the market at $690-$715/st DEL in the region.
Western Canada: Anhydrous ammonia pricing was unchanged at $996-$1,005/mt DEL in Manitoba, $1,005-$1,014/mt DEL in Saskatchewan, and $1,014-$1,040/mt DEL in Alberta.
Middle East: A sale by Sabic to Transammonia just before Christmas provided evidence of a softer ammonia market in the region. The deal involved 18,600 mt at a reported price of $460/mt FOB. Sources say the netback price was derived from the actual sale to IFFCO in India at $520/mt CFR.
The drop in prices came as no surprise. It represents a level many had talked about but could not confirm because of the lack of a spot sale.
Until the Trammo deal, the sales from the region were under contracts, with both sides keeping the price closely held.
The market is expected to soften even more as Qafco 5 comes fully online later this month. The new facility will boost Qafco’s annual output from 2.2 million mt to 3.8 million mt. Even as the plant was preparing to come online in early December, sources reported that most of the new tonnage will be covered by contracts.
Early last week Mitsubishi signed an annual contract with Qafco to take 80,000 mt, with an option for an additional 40,000 mt. That amount – 10,000 mt per month – is just about the monthly demand from a major Mitsubishi client in Asia.
Two other deals – with Coromandel International and Paradeep Phosphates, both of India – put more sales in the Qafco order book. Coromandel will take 150,000 mt, with an option for an additional 50,000 mt. PPL will take 100,000 mt. Sources expect the rest of the tons to be snapped up for other long-term buyers.
One trader noted that there may still be some more softening in the market. For now, however, the regional market is pegged at $460-$470/mt FOB.
Black Sea: Output in the Yuzhnyy area is expected to drop below 200,000 mt this month as plants take turnarounds and as natural gas is diverted to consumer use.
The January price in Tampa and the recent Transammonia-Sabic deal show a continued decline in global ammonia prices.
The latest price estimate from the area is pegged at $485-$495/mt FOB.