US Gulf/Tampa:
Tampa ammonia for November moved down $25/mt, to $1,150 from October’s $1,175/mt CFR. Sources had been speculating that the price might go down or rollover as more European ammonia plants come back online due to lower natural gas prices.
Eastern Cornbelt:
Fall ammonia application was accelerating in Illinois and Indiana in late October, while an Ohio source said he was expecting “really good movement” to kick into gear in early November. The ammonia market remained at $1,300-$1,400/st FOB for available offers, with the low confirmed at Lima, Ohio, and the high at East Dubuque, Ill.
Western Cornbelt:
With fall movement starting to ramp up in parts of Iowa, ammonia pricing had reportedly firmed to $1,290-$1,320/st FOB for prompt truck tons out of terminals in Iowa and Nebraska, up from $1,250-$1,275/st FOB earlier in October.
Northern Plains:
The latest ammonia offers in the Northern Plains remained at $1,200-$1,250/st FOB and $1,245-$1,300/st DEL for fall tons. “Minnesota has been applying hard the last seven days, but North Dakota is yet to really take off, especially considering we had some pretty widespread rain/snow this week,” said one contact. “There is a lot of optimism in North Dakota now given the recent moisture.”
Black Sea:
The lack of any material moving out of the area leaves the industry with no markers for a price. Sources said the bulk of the ammonia moving in the Black Sea is smaller cargoes going into Turkey.
Sources said Turkish buyers are paying $1,150-$1,180/mt CFR even as demand seems to be dwindling. Reportedly demand for ammonia is slowing down as end users are having to cut back on production due to government export limitations.
With the closure of the ammonia ports in Ukraine due to the Russian invasion, Turkey has moved aggressively since March 2022 to find other sources. Of the 435,000 mt imported during January-August, about 43% of the tons – 188,000 mt – came from sources that have not shipped to Turkey in the past, according to Trade Data Monitor.
For a while, Turkey had turned to Iran for inexpensive ammonia. However, sources now said that relationship is in jeopardy. Political disputes between Turkey and Iran could foreshadow a cutback in ammonia shipments to Turkey.
India:
Ammonia demand in India remains steady. Spot buyers are taking limited tonnage, mostly from non-Arab Gulf sources, and the price has remained steady at $850-$900/mt CFR.
Middle East:
The shutdown of a Ma’aden phosphate plant might also mean a cutback in ammonia production. Sources said the ammonia plant generating product for phosphate production will most likely stop production instead of moving the tons to the open market.
One trader said producers are pushing hard for prices at $1,100/mt FOB and higher. The introduction of excess ammonia into the market could work against their efforts, he noted. Producers have been telling potential buyers they are sold out through October and November. When they offer product at $1,100/mt FOB, buyers demur and look for other sources – and they are usually able to find them.
Sources called the real market at $1,050/mt FOB, but could not point to any recent business to back up that claim. They note the price was achieved a while back in a small spot deal.
Northwest Europe:
Sources said the lack of any new spot business leaves the ammonia price at $1,250/mt CFR. As natural gas prices soften and as ammonia production in the rest of the world remains strong, sources said the price is set for a downward correction.
Buyers are pushing for $1,100/mt CFR and below, but are still not finding any supplier to match that level.
Sources said the window for lower prices could close in January. Russian ammonia is still being offered out of Finland. Soon after the invasion of Ukraine, the Finnish government tried to block the transfer of Russian ammonia and other products on the Finnish rail system for export from a Finnish port. Citing contract obligations through December 2022, the rail system continued to move the ammonia across the country for export.
Come January 2023, however, sources said the contract will expire and the sanctions against transporting Russian ammonia will kick into place. The move will block the transport of about 600,000 mt of ammonia each year. The main buyer, Yara, will have to search for replacement tons. This could put upward pressure on prices from the Caribbean to Southeast Asia.
Southeast Asia:
Demand for ammonia remains weak. Industrial buyers are cutting back on their need for ammonia as demand for finished products lessens. Buyers are asking their suppliers to ease back on how many tons are sent under their existing contracts.
Producers in the area are covering many of the spot needs for local buyer, as well as making deals with end users farther away. Reportedly, OCP/Morocco has reached an agreement with Indonesian suppliers for at least one cargo of ammonia a month. The tonnage is to partially replace the ammonia lost from the lack of Black Sea tons due to the war in Ukraine.
Indonesia exported 1.33 million mt of ammonia during January-August 2022, according to Trade Data Monitor, up marginally from the 1.3 million me exported during the same period in 2021.
The main buyers were South Korea with 402,000 mt, India with 182,000 mt, Taiwan with 151,000 mt, and Japan with 146,000 mt. In addition, Indonesia sent 65,000 mt to Northwest Europe during this period. During the first eight months of 2021, no sales were made to Europe from Indonesia.
August 2022 exports were reported at 141,000 mt, down 24% from the 184,000 mt shipped in August 2021. India with 47,000 mt and South Korea with 45,000 mt accounted for two-thirds of export sales in August 2022.
China has been cutting back on ammonia imports and stepping up its exports.Imports of ammonia into China for January-September 2022 were reported at 195,000 mt by Trade Data Monitor, down 71% from the 660,000 mt imported during the same period in 2021. The main supplier was Indonesia with 110,000 mt.
Third-quarter 2022 imports were also down dramatically, to 50,000 mt from the 164,000 mt imported during July-September 2021.September 2022 imports were reported at 19,000 mt, compared to 65,000 mt purchased in September 2021.
Exports of ammonia from China have picked up in the last half of 2022. Exports for January-September 2022 were reported at 105,000 mt by Trade Data Monitor, compared with 1,800 exported during the same period in 2021.
September 2022 exports were pegged at 58,000 mt against the 120 mt exported during September 2021. India took 19,000 mt, about one-third of the September exports.
Sources said China has more ammonia available for export because industrial production, including fertilizers, is down across the board in China. The excess ammonia is being offered at favorable rates. At first, buyers in Southeast Asia benefited from the sales. By September, however, buyers as far afield as South Africa were able to secure Chinese product.