US Gulf/Tampa:
Tampa ammonia remained at $285/mt CFR for July, $55/mt below June’s $340/mt CFR price. Truck pricing out of Gulf Coast terminals was quoted in the $260-$280/st FOB range, with the NOLA market at a Tampa-equivalent of $259/st FOB, although sources reported no new activity on the Gulf Coast.
US Imports:
Ammonia imports fell 11.1% in the July-May fertilizer year-to-date, according to US Census Bureau data, to 2.24 million st from 2.51 million st in the prior year. May imports were 9.3% lower, to 294,294 st from the year-ago 324,423 st.
July-May imports from Trinidad and Tobago were reported at 1.16 million st. Canada sent 1.00 million st, followed by Algeria with 27,887 st.
US Exports:
Ammonia exports moved up 243.2% in July-May, to 1.27 million st from the year-ago 370,038 st. May cargoes totaled 137,368 st, up 92.9% from last year’s 71,203 st. Norway was the top US export destination in July-May, taking 207,796 st, followed by Chile at 205,418 st and Morocco at 126,635 st.
Eastern Cornbelt:
Fall prepay prices for ammonia were announced on July 13 at $425/st FOB in Illinois and $430/st FOB in Indiana, up from the last fill business reported in the $350-$365/st FOB range. Sources said the earlier fill offers are now off the table.
Western Cornbelt:
A new round of fall prepay prices on July 13 pushed the ammonia market to $390/st FOB in Nebraska, $410/st FOB in Iowa, and $415/st FOB Palmyra, Mo., up from the prior fill offers in the $340-$350/st FOB range. New prepay pricing in the Southern Plains included $375/st FOB Verdigris, Okla., up from the earlier $300/st FOB fill offer at that location.
Northwest Europe:
Natural gas prices in Europe continue to drop, lowering the production cost to ammonia producers. Sources now put the break-even price around $350-$360/mt ex-plant, leading to softer bids for product. Buyers are now reportedly demanding tons at $300/mt CFR, with no deals reported at that level.
The best guess for prices in Northwest Europe now stands at $310-$315/mt CFR, sources said, but with an expectation that prices will fall. Only sales revolving around existing contracts have been reported so far, leaving a void in the spot market.
Russia’s efforts to move product out of its St. Petersburg port have been paying off. Two vessels from Ust-Luga have come into Antwerp, sources said. The cargoes were shipped by EuroChem for its own facilities, so pricing is opaque. A third cargo from Ust-Luga was sent to Turkey and is currently being unloaded.
The Russian port handling the ammonia shipments was designed for dry bulk commodities. To make it work as an ammonia port, sources said the ammonia is being piped directly from trucks to an anchored vessel, which serves as a floating storage facility. From the storage vessel, other ships are loaded for export.
Black Sea:
No Russian ammonia exports from the Black Sea are expected until 2024. The effort to build an ammonia terminal at the Port of Taman is taking longer than anticipated. Sources now expect the facility to be ready for use during the first quarter of 2024, instead of the last quarter of 2023.
Sources reported that Turkey is cutting back on its purchases of so-called “distressed” ammonia, a common term for ammonia originating from sanctioned states such as Russia, Venezuela, and Iran. Turkey has already purchased cargoes from Russia and Venezuela, sources reported. Both vessels should finish unloading by next week.
The cargoes represent the first shipments from the two countries this year. Turkey’s purchases of Iranian ammonia have represented a small portion of the country’s total imports. Turkey imported 796,000 mt in 2022, of which Iran supplied 32,000 mt. Iran sent 11,400 mt of Turkey’s 395,000 mt imports in January-May 2023.
India:
The spot ammonia price, based on a FACT deal from late June, held at $304-$310/mt CFR. A subsequent tender call, reported to draw few offers, caused the company to postpone its latest tender.
The last tender had only one offer. Sources said FACT faces an ongoing problem of getting offers because of the low tonnage requested. The 7,500 mt tenders will only work for most sellers if the tons can be combined with more material to be unloaded at a second stop. Unfortunately for FACT, the company is currently the only spot ammonia buyer in India.
The bulk of ammonia flowing into India is attached to long-term contracts. Demand for ammonia is slow and steady enough that none of the main buyers are seeking spot tons to augment their contracted purchases. At the same time, most producers are currently happy with their order books and do not see a need to make accommodations for FACT. Sources estimated the contract price of ammonia at $270/mt CFR or lower.
January-May ammonia imports totaled 983,000 mt, Trade Data Monitor reported, up 18% from the year-ago 832,000 mt. May imports of 241,000 mt were up from 182,000 mt in May 2022. Saudi Arabia sent 104,000 mt for the month, followed by Bahrain with 56,000 mt.
Middle East:
Producers remain comfortable with their contract ammonia orders. However, the lagging Southeast Asia market could soon force a shift in the situation, sources said, as production is already exceeding demand. The growing excess tonnage could force producers to accept lower prices just to free storage space.
The ammonia market’s most recent spot price, reported several weeks ago, continues to hold at $200-$210/mt FOB for now. Buyers inquiring about spot tonnage are quoted a price of $240-$250/mt FOB. None of the markets can absorb that price, sources said, so the deals go unfulfilled.
Demand for ammonia is expected to remain weak compared to production, sources said. Southeast Asian buyers are taking the minimum required under their contracts. European buyers are demanding lower prices and pressing the producers to absorb the import duty imposed on Arab Gulf ammonia, forcing a lower netback. So far, producers claim they are at a balance with supply and demand and see no reason to lower their pricing expectations for spot material.
Iran exported 349,000 mt of ammonia in January-June, according to Trade Data Monitor, a 44% year-over-year increase from 242,000 mt. India purchased 312,000 mt for 89% of the market.
Second-quarter exports totaled 206,000 mt, up 64% from the year-ago 126,000 mt. Iran shipped 86,000 mt in June, up 93% from 45,000 mt in June 2022. India bought 82,000 mt.
Southeast Asia:
Ammonia demand is down due to reduced industrial output. Sources said buyers are not showing any interest in picking up spot tons or even asking for a few extra tons in existing contracts. The low demand is putting downward pressure on prices. The only thing preventing a major drop, said traders, is the lack of ammonia produced in the region itself.
In Indonesia, Kaltim III is down for a routine turnaround. A Malaysian plant, reported offline in June for unscheduled maintenance, will shut once again for a routine one-month turnaround. At the same time, the area’s softer prices are keeping Chinese offers off the table.
Indonesia exported 698,000 mt of ammonia in January-May, Trade Data Monitor reported, a 16% decline from 828,000 mt exported during the same period in 2022. May exports were noted at 101,000 mt, down 43% from the year-ago 176,000 mt. China purchased 41,000 mt for the month, Australia took 23,000 mt, and South Korea received 15,000 mt.
Brazil:
Ammonia imports to Brazil fell 34% in January-June, Trade Data Monitor reported, to 158,000 mt from 239,000 mt in the prior year. Trinidad and Tobago led suppliers with 153,000 mt. June imports totaled 38,000 mt, all from Trinidad and Tobago, down from 42,000 mt in June 2022.
January-June exports were reported at 33,000 mt, off from the year-ago 49,000 mt. The US bought 18,000 mt, followed by South Africa with 15,000 mt. Brazil exported just 41 mt in June versus 15,000 mt reported in June 2022.