U.S. Gulf/Tampa:
July Tampa ammonia prices continued at $585/mt CFR, with the industry awaiting a decision for August. Producers are eyeing yet another increase, citing high international prices. Sources reported another Trinidad export to South Korea at high numbers, as well as higher prices to Europe, where natural gas prices have shot up.
On the other hand, NOLA observers said the U.S. Gulf itself has plenty of ammonia with all the major plants back in production, including IPL’s Waggaman plant. They said there is no need for higher prices either at Tampa or NOLA.
A NOLA barge trade was reported at $585/st CFR, which equates to $645/mt CFR and is in line with recent reports of exports out of the Caribbean at a reported $605-$610/mt FOB. However, the new barge trade was producer-to-producer, with some players saying a better deal could be had. Another factor is that Gulf Coast trucks have been going for as low as $525/st FOB.
Eastern Cornbelt:
Ammonia prompt and fall prepay prices were steady at $635-$650/st FOB in the Eastern Cornbelt, depending on location and supplier.
Western Cornbelt:
Ammonia pricing was unchanged at $635-$650/st FOB in the Western Cornbelt for prompt or fall prepay offers, with the low confirmed at Palmyra, Mo., and the high at Fort Dodge, Iowa.
California:
Anhydrous ammonia was unchanged at $626/st DEL in California, with aqua ammonia referenced at $172/st FOB.
Pacific Northwest:
Ammonia prices were quoted at $635/st FOB terminals in the Pacific Northwest, up $15-$20/st from last report, with rail-DEL offers pegged at the $675/st level. Aqua ammonia remained at $168/st FOB Kennewick, Wash.
Western Canada:
Ammonia pricing in Western Canada was quoted at C$960-$1,020/mt DEL for limited offers of fall tons, depending on location. That range was up significantly from the last prompt business reported in June.
Nutrien confirmed that its Redwater, Alta., nitrogen facility will be completing a planned maintenance outage at its larger ammonia and urea plants from late July through early October. The company said all other assets at the site will continue to operate as planned.
Black Sea:
Sellers keep pushing for $600/mt FOB, and a couple of weeks ago many thought it would be achieved. Now, however, the movement up on prices is slowing down.
Sources said ammonia prices out of Yuzhnyy have edged up slightly, to $555-$560/mt FOB. Even with the increase, traders said the price is close to its apex. One trader said moving the price beyond the $560s/mt FOB will be difficult.
Sources are talking about prices beginning to soften as buyers begin to look for September shipments. The big unknown, however, will be how soon production picks up again in Saudi Arabia and Indonesia. Until Ma’aden and the Mitsubishi PAU facilities come fully back online, sources said there will be a shortage of ammonia that keeps upward pressure on prices.
Middle East:
The ammonia price in the region held steady in the $620s/mt FOB only because of the lack of material to reposition the spot price. Sources said sales out of the area were all based on long-term contract sales.
Nearly everyone in the industry agrees with producers that there is no available spot material. The lack of even a few extra tons of ammonia from the Arab Gulf is having an impact across the globe. Buyers in Asia have turned to Russia and Trinidad to fulfill their needs.
There is no word out of Saudi Arabia when the Ma’aden plant will be back up, but there are reports that production may restart in late August. Even if the plant comes back up, sources said the ammonia produced will most likely be turned over to the DAP processing operation, leaving nothing for the export market.
Iranian ammonia exports during the first half of this year were up 89 percent, to 316,000 mt from 167,000 mt during the same period last year, according to Trade Data Monitor. The main buyers so far this year were India at 188,000 mt and China at 71,000 mt.
Second-quarter exports were up 14 percent, to 191,000 mt from 167,000 mt last year. India dominated again, taking 109,000 mt in the April-June period. Second-quarter exports were up 66,000 mt from the first quarter.
June exports remained relatively stable at 65,000 mt, compared with 64,000 mt in June 2020. Taiwan and India took the June business, with 33,000 mt and 31,000 mt, respectively.
India:
Companies are anxious for product. However, the high price of ammonia makes it difficult for many buyers to cut a deal.
The July 13 FACT tender was scrapped. Sources said no reason was given, but the usual excuses are either that no offers were made, or the offers submitted had prices so high that buyers had to reject the tons.
The current price of ammonia is hitting the DAP producers in India at a time when they really need the product. The high price of ammonia is also being matched by expensive inputs such as sulfur and phos rock. As a result, the final product price is beyond the maximum retail price allowed by the Indian government, so producers lose money with each sale.
Even with the high prices, sources said a number of large buyers are making inquiries in the freight market for vessels. Sources said the cargoes appear to all be contracted tons, which are priced much lower than where any spot deal would be.
Southeast Asia:
Traders said there are more inquiries coming out for September shipments, and buyers are looking far from the usual regional suppliers because of limited tons in the area.
Sources said there is still no word on when the PAU facility run by Mitsubishi in Indonesia will be fully operating. Many regional buyers had pinned their hopes on the facility to ensure a steady and local source of ammonia.
Northwest Europe:
Early in the week, sources said Borealis paid in the upper-$660s/mt CFR for product from Trinidad. Traders in the area said the price was more likely closer to $660/mt CFR, but it was quickly followed with other deals at $665/mt CFR.
One trader noted that the Borealis deal and the movement in Yuzhnyy have moved the Northwest Europe price to $630/mt C&F.Talks for the August Baltic price are not expected to start until next week, but a price increase is expected.
North Africa:
Sources said phosphate giant OCP in Morocco is absorbing all the ammonia it can get. Reportedly, the company is adjusting its production between DAP, MAP, or NPKs to fit with its ammonia supply.
Sources reported that Abu Qir in Egypt sold a cargo to Yara. Trammo also picked up a Libyan cargo. Destinations and prices for both cargoes were not revealed.
China:
China imported 500,000 mt of ammonia in the first half of the year, according to Trade Data Monitor, down 6 percent from the 532,000 mt imported during the same period last year. June imports were down 78 percent, to 28,000 mt from 131,000 mt in June 2020. Second-quarter 2021 imports were down 56 percent, to 144,000 mt from 324,000 mt last year.
The problems of production in Saudi Arabia and Indonesia affected the sources of China’s imports. Bahrain and Oman came in with fair-sized cargoes in the second quarter after sending nothing in previous periods.
Some of the reduction of imports was also attributed to the cutback in power to the Chinese industrial sector. Phosphate producers had to throttle back in May and June so electricity could be diverted to residential use as air conditioning demand kicked in.
South Korea:
First-half ammonia imports in South Korea were up 19 percent this year, to 731,000 mt from 614,000 mt during the same period last year, according to Trade Data Monitor.
June 2021 imports were up dramatically, to 137,000 mt from the 70,000 mt total in June 2020. Indonesia was the main supplier in June, but Egypt and Mexico each showed up for the first time at 21,000 mt and 24,000 mt, respectively. These cargoes show clearly how buyers have had to step away from the usual sources of Southeast Asia or the Arab Gulf to ensure a steady supply of ammonia.
Second-quarter ammonia imports were up by almost 50 percent, to 350,000 mt from 238,000 mt during the same period in 2020.