U.S. Gulf/Tampa: The ammonia markets remained quiet.
NYMEX natural gas closed Aug. 15 at $3.419/mmBtu, up from Aug. 8’s $3.297/mmBtu.
June anhydrous ammonia imports were down 6 percent, according to the U.S. Department of Commerce, dropping to 536,428 st from the year-ago 570,854 st. July-June imports were up 1 percent, to 7.18 million st from 7.1 million st.
Eastern Cornbelt: Cooler-than-normal weather continued in the Eastern Cornbelt in mid-August, and combined with adequate moisture to create very favorable crop conditions.
Sources reported no activity on the fertilizer front, and spot prices remained flat to soft. Although most expect a brisk fall application season in the region, sources say there is little incentive to buy due to low grain prices and falling fertilizer prices.
“I don’t know anything out there that doesn’t look weak right now,” said one regional contact. “We may have found the bottom for some products, but who knows?”
Ammonia pricing remained at $540-$560/st FOB in Illinois, with the Indiana market $10/st higher.
Western Cornbelt: Sources continued to report the anhydrous ammonia market at $510-$525/st FOB in Nebraska, $525-$540/st FOB in Iowa, and up to $550/st FOB in the Missouri market.
Missouri was still recovering from torrential rains and flooding earlier in August, while the rest of the Western Cornbelt experienced unseasonably cool weather at mid-month. “What we really need now is warmer weather,” said one contact. “We need some warm days to finish off the corn, but overall crops look good.”
Southern Plains: Kansas and Oklahoma sources reported wet field conditions in many locations after several weeks of heavy precipitation.
One Kansas contact said parts of his trade area collected 25 inches of rain in three weeks. As a result, he said upland corn and soybean crops look exceptional. The effects of lingering drought were still evident in many of the region’s other crops, however.
Sources noted that the region was on the cusp of the preplant wheat push. According to one Kansas source, however, the wet weather has tightened the window for preplant ammonia applications. “We’re seeing customers opt out of ammonia applications to consider alternative N sources for their wheat,” he reported.
The anhydrous ammonia market had reportedly slipped to $460-$490/st FOB regional production points, depending on location, with the market out of pipeline terminals in Kansas pegged in the $510-$520/st FOB range.
Middle East: Arab producers continue to hold out for $410/mt FOB and higher – and continue to get rebuffed.
The latest example was a FACT award to an Iranian supplier in the low $450s/mt CFR. Sources report that Sabic offered at $470/mt CFR. The netback for the Sabic material is pegged at $410-$415/mt FOB.
Sources say, however, that no one is willing to pay above $405/mt FOB. Discussions for new tons actually start closer to $390/mt FOB, but so far no one has concluded any business below $400/mt FOB.
Industry watchers place the regional market at $400-$405/mt FOB.
India: FACT continues to find bargains in its ammonia buying campaign.
The latest deal, a couple of weeks ago, came from Iran at $450/mt CFR. Sources say that shipping the 6,000-7,000 mt tonnage – while small – is still dicey. Vessels carrying any Iranian material have a problem getting insurance from the usual sources, thanks to the economic embargo placed on Iran by the U.S. and European countries.
The most recent Indian urea tenders have specified that the seller has to provide the insurance for any Iranian material. For all o