US Gulf/Tampa:
Expectations for July Tampa ammonia are being heard around the $300/mt CFR mark, down from June’s $340/mt, though no deal has been reported. Plentiful supply, lower natural gas prices in Europe, and recent June fill offers in the inland markets were cited as pressuring the market.
Eastern Cornbelt:
Most of the ammonia fill programs announced in mid-June were reportedly still on the table as the week progressed. Fill business fell in the $345-$365/st FOB range in the Eastern Cornbelt for the week, with the low confirmed for June shipment at East Dubuque, Ill. Fill pricing in the Lima, Ohio, market was reported in the $360-$365/st FOB range.
Western Cornbelt:
Sources continued to report active ammonia fill programs in the $340-$350/st FOB and $350-$370/st DEL ranges in the Western Cornbelt, with Southern Plains fill offers quoted at $290-$300/st FOB, depending on location. The programs were announced the week before, with Koch posting its fill prices on June 12, followed by CF one day later.
Northern Plains:
Ammonia fill offers were reported at $350/st FOB or DEL in the Northern Plains, well below the last $450-$490/st FOB prompt business. Sources suggested producers were also taking sales under their posted prices, though no actual levels were confirmed.
Eastern Canada:
Ammonia fill pricing in mid-June was reported at the C$460/mt level FOB Courtright, Ont.
Black Sea:
Turkey continues to look for ammoniadeals, and a cargo of Russian material shipped from a Baltic port was counted among its latest purchases. Sources put the delivered price just under $300/mt CFR.
Northwest Europe:
The reinstatement of the EU’s 5.5% tariff on imported ammonia was not expected to majorly influence the market. Sources expect to see netbacks from the Arab Gulf come down to compensate for the duty.
As the tariff took effect, sources described the Northwest Europe ammoniaprice softening to $360-$365/mt CFR. One trader called the shift insignificant, tying it to softening natural gas prices seen during the week.
Russian ammonia was noted shipping out of a Baltic port, with sources reporting sales into the UK, Bulgaria, and Turkey. The ammonia is being offered at a discount to encourage sales, said one source. As a result, Turkish buyers have snapped up the bargains.
India:
FACT returned to the international market with two ammonia cargoes of 7,500 mt each, both handled by Trammo. The first traded late last week at $310/mt CFR for late-June delivery, while the second concluded earlier this week at a reported $304/mt CFR for early-July delivery.
FACT also issued a buying inquiry for late-July arrival. Offers are due to the company by June 26.
FACT’s return to the global marketplace reportedly stemmed from the company’s stepping up of demand in a way its domestic supplies cannot cover. Sources noted that the small quantity of each shipment FACT receives is priced at a premium compared to what larger buyers, such as IFFCO, pay. In addition, the FACT orders were done on a prompt spot basis rather than through a long-term contract. One source estimated that larger buyers are purchasing their ammonia under contract for less than $300/mt CFR.
There are reports that FACT is planning more upgrades to its port facilities in order to handle larger vessels. The company previously increased its storage capacity to allow for more tons to be held in reserve. The new port upgrades are also expected to include expansions to the storage facilities.
Middle East:
Sources said even though the EU tariff is once again in place, sales into Europe from the Arab Gulf are not expected to diminish. Despite comments from producers that material is tight through August, sources said the region appears to be in an oversupplied situation.
Ammonia prices remained steady at $200-$210/mt FOB. While some have argued the market seems to have found a floor at this level, others contend that producers may have to shave a couple more dollars off to compensate for the return of the EU import tariff.
Sales to Pacific buyers picked up this week, as Yara looked for tons to cover production lost during a turnaround at its Pilbara plant in Australia. At the same time, buyers in Southeast Asia are also looking for material as China withdraws from the ammonia export market due to falling prices.
Southeast Asia:
Producers in Indonesia and Malaysia are reportedly having no problems finding buyers in the region. The week opened with deals under discussion at $310-$320/mt FOB, while Petronas reported a sale at $325/mt FOB later in the week.
China:
Chinese ammonia exports firmed to 133,000 mt in January-May, Trade Data Monitor reported, up dramatically from 8,500 mt exported through the same period of 2022. First-quarter exports totaled 127,000 mt, followed by 4,000 mt in April. May exports were 2,500 mt, off from the year-ago 8,000 mt.
The drop in Chinese exports was expected, said sources, as prices came off from near-record highs. As the price that regional buyers were willing to pay came down, Chinese suppliers found their margins narrowing, and sales prices are now falling below the production costs for many producers. At the same time, Chinese industries stepped up their demand for ammonia, drawing tons away from the international market.
January-May ammonia imports were counted at 316,000 mt, a significant increase from the prior-year 100,000 mt. Limited industrial activity in 2022 reduced ammonia demand in China, sources said, prompting a lower import total for that year.
South Korea:
South Korea ammonia imports softened 28% in January-May, Trade Data Monitor reported, to 457,000 mt from 634,000 mt in the previous year. May imports were 96,000 mt, down 10% from 106,000 mt in May 2022. Indonesia led May suppliers with 38,000 mt, while Saudi Arabia sent 36,000 mt and Australia added 22,000 mt.