US Gulf/Tampa:
Tampa ammonia took a $200/mt or 25% tumble for March, dropping to $590/mt CFR from February’s $790/mt CFR. Major players had been expecting a significant fall in prices due to lower natural gas prices in Europe and the US. Sources also reported swollen NOLA inventories and pointed to the recent reset in Cornbelt prices.
Eastern Cornbelt:
The ammonia market remained at $840-$850/st FOB for spring tons in the Eastern Cornbelt, with the low reported in Illinois and the high in Indiana and at Lima, Ohio. Sources continued to report little in the way of new business, however.
Western Cornbelt:
No changes to ammonia prices were reported in the Western Cornbelt following the declines observed over the previous two weeks. The latest spring offers continued to be quoted at $725/st FOB Palmyra, Mo., and Wever, Iowa; $750/st FOB Hermann, Mo.; $775/st FOB Hoag, Neb.; $780/st FOB Fort Dodge, Iowa; and up to $840/st FOB spot terminals in eastern Iowa.
Southern Plains:
Ammonia prices for spring tons were pegged at $610/st FOB Pryor, Woodward, and Enid, Okla., and $650/st FOB Verdigris, Okla. Truck pricing out of Gulf Coast terminals slipped to $675/st FOB.
South Central:
The last offers for ammonia in the South Central region were quoted at $700/st FOB Cherokee, Ala., and $675/st FOB Gulf Coast production points for prompt truck tons.
Black Sea:
Exports of ammonia from the Black Sea remain nonexistent. Imports to countries along the Black Sea’s southern rim continue, however.
Rumors are circulating that Toros in Turkey bought a cargo from Samsung at $550/mt CFR. While sources were not able to confirm the deal, reports among industry players indicated that the information came from Turkey. If the deal is true, traders said the price would represent a drop of $100/mt.
Sources said if the material came from the Arab Gulf there would be a netback of $470/mt FOB, which is far below current levels under discussion. Speculation that the tonnage could have come from Iran was dismissed, with one trader noting that Toros normally eschews Iranian product.
India:
Sources reported a lack of buying interest, while reports circulated that OQ offered a small cargo to an Indian buyer, only to have it rejected. Vessels are still said to remain lined up at key ports waiting to unload their cargo, as many of the tanks owned by receiving companies are full. Reduced industrial output was blamed for the backup in the ammonia supply chain.
Traders reported a rumored offer price of $650/mt CFR, for a netback to the Arab Gulf of $600/mt FOB. Other discussions with potential buyers also reportedly focused on the $650/mt CFR level, but with no takers. Contracted tons continue to be shipped to India, with most of the cargoes destined to wait at anchor until storage space clears.
Middle East:
Reports of talks between buyers and sellers show a wide gap in pricing ideas. Sources said bids are coming in around $600-$610/mt FOB, while producers continue to publicly ask for $680/mt FOB.
Pressure is building for lower prices. Rumors of a sale into Turkey with an Arab Gulf-equivalent price of $470/mt FOB – while buyers remain firm in their calls for prices at $600/mt FOB and below – leave little room for flat or higher prices.
New buyers also point to sales into Southeast Asia showing netbacks of $620-$650/mt FOB. One trader said the netbacks from these sales have become the starting point for buyers who want to push the price lower.
Northwest Europe:
No new deals were reported in the area, although sources said the estimated production price in Europe is now at $600/mt ex-plant and falling. At the same time, expectations of a $200/mt price drop at Tampa kept buyers from stepping up.
Sources said that a serious lack of demand for ammonia is giving buyers support in their demands for lower prices. This reduced demand is also pushing companies to close production operations.
A drop of $200/mt in Tampa to $590/mt CFR would mean an estimated price of $610-$620/mt CFR in Northwest Europe, said sources. Even with the drop in price, traders said buying interest remains limited. They were keen to point out that no business is expected to be done at this level. Additional softening in prices is expected.
South Korea:
January ammonia imports were 103,000 mt, according to Trade Data Monitor, down 37% from 163,000 mt in January 2022. The main suppliers were Saudi Arabia with 48,0000 mt, good for 46% of the import market, followed by Indonesia with 43,000 mt.
Poland:
Grupa Azoty produced 265,000 mt of nitrogen fertilizer in January, the company said in a Feb. 23 market filing, down 17% from 319,000 mt in January 2022.