U.S. Gulf/Tampa:
Tampa ammonia prices for October jumped $30/mt, moving to $245/mt CFR from September’s $215/mt CFR, continuing an upward trend from August’s $190/mt. While some sources expressed surprise by the extent of the increase, others said it could have been more in light of higher international price ideas.
In the meantime, sources reported that recent NOLA barge trades have occurred within the $180-$190/st FOB range.
Eastern Cornbelt:
The ammonia market remained at $305-$340/st FOB in the Eastern Cornbelt, depending on location, with the lower numbers reported in the Illinois market. One source quoted the bulk of recent prompt sales in the $320-$330/st FOB range in the region, but said prices “will need higher values in the future.”
Western Cornbelt:
The ammonia market ranged from $290-$325/st FOB for fall tons in the Western Cornbelt, depending on location and supplier. Sources quoted pricing out of Port Neal, Iowa, at the $310/st FOB level at midweek.
California:
The California ammonia market remained at $410/st DEL for anhydrous and $118/st FOB for aqua in early September.
Pacific Northwest:
The anhydrous ammonia market remained at $350/st FOB and $350-$380/st DEL in the Pacific Northwest, with the low for railed tons and the upper end for truck-DEL product. The aqua ammonia market was steady as well at $98-$102/st FOB in the region.
Western Canada:
The anhydrous ammonia market was pegged at C$505-$510/mt DEL in Western Canada for fall tons, although some sources confirmed the last actual business at the C$495/mt DEL level.
Baltic:
Last week’s sale of 15,000 mt to OCI at $270/mt FOB caught the attention of the industry because the price was way out of line with the general market trends. Sources noted that while prices have been moving up around the world, the big leap taken in this sale is not reflective of other markets.
Reportedly, the OCI purchase was made more in desperation rather than for any long-term planning, and Uralchem was more than willing to take advantage of the buyer’s predicament.
Ammonia-producing regions around the world reported shortages of spot material. Sources said that once OCI exhausted all other options, it had no choice but to accept the dramatically higher price from Uralchem. Sources said only one more small cargo is available in the area for October, and OCI may once again have to pay a higher-than-expected price.
The upward price on Baltic ammonia is two pronged, said one trader. The global demand and lack of product from other sources provided a firm floor on pricing ideas. In addition, the bulk of ammonia produced in the region is being used for domestic consumption. The strength of the domestic market ensured that any export price would be dramatically higher. Reportedly OCI was told it could have the cargo, but only if it matched the domestic price.
The OCI purchase was for material to be sent to Northwest Europe. Sources said freight to Antwerp is about $35/mt, leaving a landed price of $305/mt CFR. Even the most bullish industry watchers said that price was high for the current market.
Black Sea:
Sources reported that the only tons available in October are already under contract. One trader estimated that about 160,000 mt will flow out of Yuzhnyy in October.
Producers are reportedly looking for netbacks at $220/mt FOB, but without any spot sales to back up their desires, sources said the public price is put at just above $200/mt FOB. Eventually, said one trader, the public price will move up if even a small cargo is sold on the open market. For now, however, promoters of higher prices point to the tight global market and a calculated price back from the high price in Northwest Europe.
The sale of material to OCI from the Baltic has a calculated price of $305/mt CFR into Antwerp. By taking $60/mt off that level, sources said the calculated price is about $240/mt FOB. While that level might be reached eventually if the current market trend continues, no one predicted this price level through October.
Middle East:
Many Arab and Persian producers are still in turnaround situations, leaving no ammonia available for the spot market. One trader described the situation as “super short.”
Arab producers are quoting $250/mt FOB to inquiring buyers. They note that even at that price, however, finding enough material to fill a large order would be difficult.
Adding to the frustration of buyers looking for tons in the area, sources said North African suppliers – often the second choice for buyers in the region – are all reporting no available ammonia. Libya and Egypt report no spare tons, and Algerian production is still down. Prices in the North Africa region are now pegged just under $220/mt FOB.
The lack of extra material in the Middle East region is hitting India and its suppliers. Sources said PCS had to provide an Indian buyer with material from Trinidad. One trader noted that seeing tons come from the Western Hemisphere to India is not unique, but it is also not common.
India:
The last bit of public business into India was pegged at $250-$255/mt CFR. One trader said that given the movement in prices around the world, buyers will not be able to match these prices. Sources said buyers are getting into the mindset that they may soon have to pay $270-$280/mt CFR for West Coast ammonia deliveries and $280-$300/mt CFR for the East Coast. Industry watchers are careful to point out that prices are currently not at these levels.
Sources speculated that Mitsubishi might move a couple of ships to India. Reportedly, the vessels are holding cargo picked up some time ago at $200/mt FOB. If the right buyers can be found, the Japanese trading house will be able to unload the product for a healthy profit.