US Gulf/Tampa:
June Tampa ammonia prices of $340/mt CFR will likely remain under pressure into July. Lower European natural gas prices are prompting more ammonia producers to return their plants to production, though perhaps cautiously in some cases. In the meantime, ammonia prices in the US heartland continue to sink as the application season wanes.
Eastern Cornbelt:
Ammonia pricing remained under pressure in the Eastern Cornbelt. Sources quoted new prompt offers at $425-$450/st FOB regional terminals, depending on location, but prices were reportedly negotiable.
Western Cornbelt:
Ammonia remained at $425-$450/st FOB in the Western Cornbelt for the latest offers, while prices in the Southern Plains dropped to $350-$405/st FOB, with the low confirmed at Pryor, Okla.
Northern Plains:
Ammonia pricing in the Northern Plains slipped to $450/st FOB and $450-$475/st DEL in North Dakota, down from the prior $525-$570/st DEL range. Sources reported several terminals on allocation or not offering tons in late May.
Black Sea:
The Ukrainian government said it would consider talks to reopen the ammonia pipeline from Russia to Pivdennyi, but only if Russia will fulfill the commitments already made to ensure safe passage of grain from Ukrainian ports in the Black Sea. Kyiv also said it wanted the ability to export its grains from additional ports.
Russia’s demands remained the same. The country not only wants the pipeline reopened, but also called for the Russian Agricultural Bank to again have access to the SWIFT electronic payment system. Without access to SWIFT, Moscow contends, it is difficult for it to export its fertilizers.
While there are no sanctions on Russian fertilizers, including ammonia, the US and EU have imposed sanctions on banks, such as the Agricultural Bank, denying them access to the global payment system most used for international deals.
Romania:
The Azomures plant in Romania announced that lower natural gas prices in Europe will allow it to restart its operations. The company said that because ammonia prices have dropped with the price of natural gas, it is now able to secure the tons it needs for production of its various nitrogen-based and complex fertilizers. The facility will start operations at just 10% of its rated 1.6 million mt/y capacity and slowly build up production as market forces allow.
Turkey:
Turkey imported 272,000 mt of ammonia in January-April, Trade Data Monitor reported,up 19% from the year-ago 228,000 mt. April imports stood at 73,000 mt, up 145% from the 30,000 mt in April 2022. The US sent 32,000 mt to Turkey, Algeria sent 25,000 mt, and Libya added 14,000 mt.
India:
Sources noted no new activity. Buyers continue to push for lower prices than the last-reported $290-$300/mt CFR. There were reports that $280/mt CFR may have been done, but sources could not identify a buyer or seller to back up the lower value.
Middle East:
Sources saw Arab Gulf prices softening to $200-$220/mt FOB. The new price comes from calculating the landed price in Asia, along with netbacks from deals reported West of Suez.
The bulk of Arab Gulf business was done under contract, mostly from India, but with growing interest for spot deals. Production remains strong enough that a surplus is building in the area, giving pushy buyers more influence in their efforts to lower prices.
Thailand:
January-April ammonia imports totaled 130,000 mt, according to Trade Data Monitor, a 30% increase from 100,000 mt in January-April 2022. April imports were pegged at 34,000 mt, down about 40% from 56,000 mt in the prior-year period. Malaysia sent 16,000 mt, followed by 15,000 mt from Australia, the country’s first ammonia exports to Thailand in 2023.
Northwest Europe:
Buyers and sellers are at a standstill. Sources said buyers are looking at sub-$300/mt CFR prices, but sellers have so far refused to drop so low. The impasse led to another week without spot business in the region.
Sources said the market will eventually drop to where buyers are targeting, as the public price, reported in the $360s/mt CFR, is now higher than Europe’s estimated $320/mt ex-plant production cost. Lower gas prices are prompting more companies to either restart their facilities or to step up production in already-opened plants. At the same time, offers for cargoes from Venezuela, Iran, and the Russian Baltic Sea are beginning to show up in Northwest Europe.
Due to the sanctions against Venezuela and Iran, buyers are limited, and purchases of the Russian material are complicated. While the Russian ammonia is not sanctioned, buyers need to ensure they follow all the rules related to transfer of payment for the product. Payment is made more difficult because Russian banks are sanctioned by the US and EU, and are not allowed access to the SWIFT payment system used for most other transactions.
The Russian material appears to be the first lot of ammonia secured through a jury-rigged loading system set up at a port located just outside of St. Petersburg. As previously reported, a ship stationed just outside the harbor is serving as a holding tank after receiving ammonia that was railed to the facility. From that ship, other vessels are loading cargoes bound for international buyers. The system was established after countries along the Baltic Sea denied Russia access to their ammonia terminals due to sanctions enacted in response to the war in Ukraine.