US Gulf/Tampa:
Lower European natural gas prices continue to pressure ammonia price ideas on the international market, including the Tampa price for February. January was $975/mt CFR, down $55/mt from December’s $1,030/mt CFR.
Eastern Cornbelt:
Ammonia prepay prices were steady at $1,095-$1,110/st FOB in the Eastern Cornbelt, with the low at Lima, Ohio. In the southern US, new offers out of Gulf Coast terminals were confirmed in the $875-$880/st FOB range for truck tons.
Western Cornbelt:
Spring prepay offers for ammonia were unchanged at $1,050-$1,100/st FOB in the Western Cornbelt, with the low in Nebraska and the high at Palmyra, Mo. Iowa terminals were reported in the $1,060-$1,070/st FOB range.
California:
Anhydrous ammonia postings in California remained at $1,250/st DEL. The aqua ammonia market was steady as well at $326-$336/st FOB, with the low at Stockton and the high at Sycamore.
Pacific Northwest:
New offers for ammonia were reported at $970-$1,000/st DEL and $950-$980/st FOB Washington terminals, with aqua ammonia pricing unchanged at $275/st FOB in the Pacific Northwest.
Western Canada:
Spring pricing for anhydrous ammonia in Western Canada was pegged in a broad C$1,475-$1,640/mt DEL range for April-June, depending on location and supplier.
Northwest Europe:
Lower gas prices in Europe are allowing more ammonia plants to open. While sources welcomed the moves, they noted that it takes time for the plants to get to full production, leaving some gaps in supply.
The cost to produce one ton of ammonia is now estimated at $800/mt, substantially down from $1,000/mt noted just a few weeks ago. The drop in production cost is expected to have an impact on imported ammonia, which in turn should hit suppliers from Indonesia to Trinidad and Tobago.
Sources reported that Asia suppliers have already stopped offering material to European buyers because of the price. Algerian product offered at $950/mt FOB is being rejected, and sources said the European-equivalent price in the $990s/mt FOB is too high for consideration.
Also pushing against higher prices were continued reports of Turkey taking more Iranian ammonia at levels that would equate to the low-$900s/mt CFR if offered into Northwest Europe. Sources quickly added that the Turkish market is quickly becoming separate from the rest of the European market because of the Iranian connection.
The lack of any new business into Northwest Europe is causing the public price to remain at $1,050/mt CFR. However, sources expect to see that price dip into the $900s/mt CFR as the rest of the global players reduce their offered prices.
India:
Sources reported no new spot deals into India. The bulk of the ammonia entering the country is from contracts with producers mostly located in the Arab Gulf. The last bit of spot business put the price in the $850s/mt CFR.
Many of the tons India bought in the last quarter of 2022 came from China. Sources said that the softer prices now hitting the ammonia market could lead Chinese suppliers to hold back their product, leaving India with fewer alternatives to the Arab Gulf.
Middle East:
The bulk of the region’s business is being done under contracts that show prices at $800/mt FOB and lower. However, spot deals done at the end of the 2022 remain the last recorded purchases.
Producers continue to argue for $850/mt FOB, even as the market softens. Traders said that producers will eventually have to drop their spot price, as the lower cost of producing ammonia in Europe is reducing the motivation for European buyers to accept high prices from outside sources. At the same time, Iran continues to offer product at a discount to the Arab Gulf price, cutting into other markets.
Southeast Asia:
Producers are trying to hold on to prices in the mid-$700s/mt FOB, even as the European price is dropping and buyers in Asia are demanding lower levels.
In order to do a deal in Europe now, sources said the price from Indonesia or Malaysia would have to come down to $650/mt FOB or so. With this in mind, buyers in South Korea and Taiwan were said to also be looking at this price for their purchases. So far, nothing has been done at these low levels.
South Korean imports for 2022 were reported at 1.3 million mt by Trade Data Monitor, down 6% from 1.4 million mt imported in 2021. Saudi Arabia was the market’s big winner, sending 574,000 mt for the year compared to 278,000 mt in 2021, followed by Indonesia with 559,000 mt. Trinidad shipped zero tons to South Korea in 2022 after sending 134,000 mt in the prior year.
December deliveries were reported at 99,000 mt, down 17% from the year-ago 120,000 mt. Shipments from Saudi Arabia accounted for 51% of the imports at 51,000 mt, while Indonesia took up the balance with about 49,000 mt.
Fourth-quarter imports were reported at 260,000 mt, up slightly from 251,000 mt in fourth-quarter 2021. The market showed a drop in imports in the second half of the year at 588,000 mt, off from 635,000 mt.