All posts by hlancey@bloomberg.net

Urea

Black Sea, Brazil, China, Eastern Cornbelt, India, Indonesia, Market Watch, Middle East, South Central, South Korea, Southeast, Southeast Asia, Southern Plains, U.S. Exports, U.S. Gulf, U.S. Imports, Urea, Western Cornbelt

US Gulf:

The NOLA urea market softened to $295-$310/st FOB for December-January, below the prior week’s $315-$330/st FOB range. While some questioned the $295/st FOB low, others confirmed that level for a first-half January trade. Most prompt December business fell in the $302-$305/st FOB range for the week, while the $305-$310/st FOB high was reported for full January.

US Imports:

October urea imports totaled 448,979 st, up 127.0% from 197,829 st in October 2022. July-October imports were 958,301 st, rising 24.4% from the year-ago 770,545 st. July-October imports from Russia were 311,136 st, while Qatar sent 163,692 st. Saudi Arabia shipped 149,651 st, ahead of 140,201 st from Algeria.

US Exports:

Urea exports softened 35.6% in October, to 55,404 st from 86,084 st in October 2022. July-October exports dropped 55.6%, to 311,235 st from the year-ago 701,483 st. Exports to Canada totaled 137,697 st in July-October, followed by 76,960 st to Chile and 72,764 st to Mexico.

Eastern Cornbelt:

The urea market dropped to a broad $355-$390/st FOB range in the Eastern Cornbelt on reports of softer NOLA barge values, down from $380-$400/st FOB last week, with the low confirmed at Peru, Ill. The Cincinnati, Ohio, market was pegged at $370-$385/st FOB during the week. Michigan urea prices were quoted at $390-$400/st FOB terminals and $420/st DEL.

Western Cornbelt:

Urea prices remained at $370-$390/st FOB in the Western Cornbelt, with the St. Louis, Mo., market unchanged at the $370-$380/st FOB level.

Southern Plains:

Urea slipped to $360-$385/st FOB regional terminals in the Southern Plains, down from last week’s $375-$390/st FOB range, with the low reported at Catoosa/Inola, Okla., for prompt tons and the high for forward offers.

South Central:

Urea prices were under pressure in the South Central region as NOLA barge values fell after the prior week’s upward spike. Urea terminal pricing in the region ranged broadly at $370-$420/st FOB, depending on location, down from $380-$450/st FOB in late November.

Southeast:

Urea at port terminals in the Southeast was down to $375-$385/st FOB for the latest offers, well below November’s $420-$425/st FOB range.

Black Sea:     

The price for prilled urea out of the Black Sea ran counter to global trends, moving up $5-$10/mt to $290-$295/mt FOB.

India: 

The current urea inventory in India stands around 7.3 million mt, sources noted, a level that traders believe is more than enough to carry the country through January 2024. The comfort that urea distributors feel in India has led international traders to expect the next tender call in mid- or late-January.

Traders are certain there will be a new tender by late January, as urea sales have been strong. Demand has been larger than expected in some areas, said sources, and the unforeseen buying surge will require the government to ensure a plentiful supply of urea.

As 2024 is an election year, one trader said the government will be under even more pressure to guarantee there are no shortages of urea, either real or perceived.

Indonesia:     

Pupuk closed another quick tender this week for 30,000 mt of granular urea. MacroSource reportedly had the winning bid at $321.50/mt FOB for 20,000 mt of product, below last week’s $342/mt FOB. Other offers in the tender ranged from $308-$318/mt FOB, sources said.

Sources said this tender and the tonnage from last week will be sent to Mexico. The delays in transiting the Panama Canal have prompted West Coast Latin American buyers to look more favorably at sourcing their product from Asian suppliers such as Indonesia, one trader noted.

Southeast Asia:         

Malaysia and Brunei are reportedly ready to join Indonesia in supplying urea to Latin America. Latin American buyers traditionally take their product from Russia or North Africa. As transiting the Panama Canal has become more complicated, West Coast buyers are now looking to Asian suppliers for product.

Sources said 30,000 mt from Petronas/Malaysia will be loaded for Peru later this month, while a second Latin American buyer was reportedly in talks with Petronas for a January cargo.

BFI in Brunei closed a selling tender late this week. While no details were available at press time, traders speculated that the cargo will also go to the West Coast of Latin America.

South Korea:

Buyers in search of small lots of urea opened talks with multiple traders. One trader reported working with a buyer to secure 6,000 mt to be shipped in a container. In the end, the trader lost out when the buyer was able to secure the tons from a Chinese trader.

The scramble for small lots came after China announced restrictions on urea exports. South Korea needs a steady supply of urea for its pollution control infrastructure. Soon after the Chinese government issued its edict on urea exports, South Korean media reported that Seoul opened talks with Beijing to arrange for a government-to-government deal to provide at least 1 million mt of urea over a 12-month period.

International traders said the transaction is likely to go through. If concluded, the deal will ensure delivery of more urea than South Korea has imported in past years. January-October urea imports were counted at 594,000 mt, Trade Data Monitor reported. Imports totaled 879,000 mt in 2020, followed by 877,000 mt in 2021, and 836,000 mt in 2022.

China:

South Korea has reportedly entered into diplomatic talks with China to ensure a steady supply of urea for the next 12 months. Traders expect to see a deal struck, giving South Korea the urea it needs for its pollution control infrastructure and agricultural needs.

The current South Korean demand is for delivery of urea in small 3,000-6,000 mt lots, within the cargo sizes mandated under China’s new export limits. The only large-quantity shipments permitted after the export restrictions were put into place were the tons associated with awards from the Indian tender. Now that the tender shipping deadline has passed, only new, smaller deals are being allowed.

The new export limitations are designed to build up domestic reserves and force the local price down. In addition to fewer tons going offshore, sources noted that urea plants are operating at 80-85% of rated capacity, and reserves are said to be building quickly. The combination is expected to result in winter reserves reaching record levels, said one trader.

Middle East: 

Talks for spot business are now centered in the low-$320s/mt FOB, sources said. While some small deals appear to have been completed, traders described the deals as mostly rumors rather than confirmed sales.

Even with few sales confirmed, the fact that buyers and sellers are talking about $320-$325/mt FOB for potential deals places the current market at that level, sources said. One trader noted that producers only appeared to become more comfortable with pricing in the $320s/mt FOB after market watchers noted estimated netbacks from sales into the US at $310-$315/mt FOB.

Freight costs have moved up, sources said, causing players to recalculate netbacks. The key issues driving the increases appear to be vessels out of position for return trips, as well as increased insurance costs due to stepped-up security threats to vessels. Increasing costs for fuel and crews are also in play, said one trader, but these impacts are not as great as the other two factors.

Deals for granular urea from Egypt were reported below $340/mt FOB for small lots of 3,000-6,000 mt. At the same time, a larger cargo of 20,000 mt was reported in the low-$340s/mt FOB. When asked, producers will argue for $350/mt FOB, but ultimately admit that the latest prices have fallen below that level.

Prices are expected to rebound as more cargoes are booked for January and February. Sources said European demand for small lots should move the price up in incremental steps during the first quarter of 2024.

Iranian material is expected to be in short supply through the near-term. Natural gas is reportedly being diverted away from urea plants in favor of residential use, which sources described as a seasonal shift in gas allocation. As a result, production is expected to be reduced to 80-85% of rated capacity.

Brazil:

Brazil urea prices pulled back to $340-$345/mt CFR, falling from last week’s $350-$355/mt CFR. Sources reported limited interest for imports, as many players have taken long positions in anticipation of safrinha demand.

Prices firmed slightly at Rondonópolis, however, to $470-$495/mt FOB ex-warehouse from $460-$495/mt FOB last week. Some suppliers continue to push for prices above $500/mt FOB, but with no trades confirmed.

The inland market’s second consecutive week of price increases, in addition to dry weather and high temperatures, have added to uncertainty surrounding the winter corn season. Purchases slowed during the week, reinforcing a belief that farmers will delay corn planting decisions to the last minute in the hope that urea prices will fall.

For now, the market’s future direction remains uncertain, and players continue to weigh the upside risks of India’s return to the market in early 2024.

UAN

Eastern Cornbelt, Market Watch, South Central, Southeast, Southern Plains, U.S. Exports, U.S. Gulf, U.S. Imports, UAN, Western Cornbelt

US Gulf:

While no new NOLA UAN business was confirmed during the week, sources pegged the latest indications at $240-$245/st ($7.50-$7.66/unit) FOB based on current river terminal pricing.

US Imports:

UAN imports for October moved 34.1% lower year-over-year, to 162,645 st from 246,886 st. July-October imports firmed 4.9%, however, to 731,746 st from 697,577 st in 2022. Russia sent 412,287 st for July-October, Trinidad and Tobago added 191,363 st, and Canada sent 128,096 st. 

US Exports:

UAN exports fell 54.9% in October, to 166,662 st from 369,825 st in October 2022. July-October totals were down 26.5% year-over-year, sliding to 764,853 st from 1.04 million st. The US sent 263,174 st to France in July-October, while Australia took 169,142 st, ahead of 164,666 st to Argentina.

Eastern Cornbelt:

The UAN-32 market was pegged at $275-$300/st ($8.59-$9.38/unit) FOB regional terminals for December-January tons, with the low confirmed at Mount Vernon, Ind., and the high at Peru. The Cincinnati market remained at the $280/st ($8.75/unit) FOB level.

In the Great Lakes region, Michigan terminals were reported at $275/st ($9.82/unit) FOB for UAN-28 and $315/st ($9.84/unit) FOB for UAN-32.

Western Cornbelt:

UAN-32 remained at $275-$295/st ($8.59-$9.22/unit) FOB in the Western Cornbelt, depending on location, with the low reported at St. Louis for December-January tons. The Port Neal market was pegged at the $280/st ($8.75/unit) FOB level. Spring offers were reported in the $300-$305/st ($9.38-$9.53/unit) FOB range on a spot basis.

Southern Plains:

UAN-32 postings from CF at terminals in the Southern Plains were down $20/st following a reset earlier in December, with new list prices for December-January quoted at $255/st ($7.97/unit) FOB Verdigris and $260/st ($8.13/unit) FOB Woodward. The upper end of the regional range was pegged at the $280/st ($8.75/unit) FOB level in Kansas.

South Central:

The UAN-32 market was quoted at $275-$285/st ($8.59-$8.91/unit) FOB terminals in the South Central region, with the low reported for prompt tons in the Kentucky market and the high for local truck business in Alabama. 

Southeast:

The UAN-32 market narrowed to $270-$280/st ($8.44-$8.75/unit) FOB regional terminals in the Southeast, within the prior $270-$290/st FOB range.

Ammonium Nitrate

Ammonium Nitrate, Market Watch, Poland, South Central, Southern Plains, U.S. Exports, U.S. Imports, Western Cornbelt

US Imports:

July-October ammonium nitrate imports softened 13.4% year-over-year, to 90,504 st from 104,567 st. October imports were down 60.4%, to 23,154 st from the year-ago 58,502 st. Canada sent 89,681 st in July-October. China added 364 st, narrowly topping 362 st from Vietnam.

US Exports:

Ammonium nitrate exports for October firmed 20.4% year-over-year, to 84,546 st from 70,196 st. July-October shipments were 37.1% higher, at 277,339 st compared to 202,319 st last year. Canada was the largest export destination in July-October with 134,471 st. Mexico received 73,641 st and Lithuania took 39,690 st.

Western Cornbelt:

The ammonium nitrate market was steady at $330-$360/st FOB in the Western Cornbelt, depending on location.

Southern Plains:

Ammonium nitrate remained at $330-$360/st FOB in the Southern Plains, with the low confirmed at Muskogee, Okla.

South Central:

The ammonium nitrate market slipped to a broad $250-$345/st FOB in the South Central region, with the low reported for the last business FOB Yazoo City, Miss., and the high out of upriver terminals.

Poland:

Grupa Azoty produced an estimated 282,000 mt of nitrogen fertilizers in November, the company reported, up from 245,000 mt in October.

Ammonium Sulfate

Ammonium Sulfate, Brazil, China, Eastern Cornbelt, Market Watch, South Central, Southeast, Southern Plains, U.S. Exports, U.S. Gulf, U.S. Imports, Western Cornbelt

US Gulf:

No new NOLA ammonium sulfate business was reported during the week, leaving the range unchanged at a nominal $270-$275/st FOB.

US Imports:

Ammonium sulfate imports softened 56.0% in October, to 41,883 st from 95,227 st in October 2022. Imports grew 54.4% in July-October, however, to 373,951 st from last year’s 242,185 st. Imports from Canada were noted at 176,795 st for the July-October period, ahead of 75,470 st from Russia and 58,054 st from Belgium.

US Exports:

October ammonium sulfate exports were 91,360 st, a 61.6% increase on the year-ago 56,538 st. Exports softened to 250,882 st in July-October, however, off 14.3% from 292,593 st during the same period last year. Exports to Peru totaled 47,963 st in July-October, beating 33,887 st to Brazil. Mexico’s 30,506 st pulled ahead of 29,626 st to Uruguay and 26,679 st to Canada.

Eastern Cornbelt:

Granular ammonium sulfate pricing in the Eastern Cornbelt was pegged at $300-$330/st FOB, with the low confirmed at Cincinnati, although producer postings were quoted as high as $335-$340/st FOB at that location. Michigan terminal prices were pegged at the $340/st FOB level.

Western Cornbelt:

Granular ammonium sulfate firmed to $300-$330/st FOB in the Western Cornbelt, with the low reported at St. Louis and the high in Iowa.

Southern Plains:

Granular ammonium sulfate pricing slipped to $285-$295/st FOB Houston, down from the prior $300/st FOB level, while offers at Catoosa/Inola were reported in a broad $305-$325/st FOB range during the week, depending on supplier.

South Central:

The ammonium sulfate market remained in a broad range at $260-$320/st FOB in the South Central region, with the low confirmed in southern Mississippi and the high in Arkansas.

Southeast:

AdvanSix announced a $15/st increase for ammonium sulfate at Hopewell, Va., effective Dec. 18. New levels will move on that date to $335/st FOB for granular, $305/st FOB for mid-grade, and $285/st FOB for standard grade.

China:

Prices came off again this week, and sources put the price of caprolactam grade amsul at $110-$115/mt FOB. Although producers would like to claim that deals are being done at the upper end of this range – such as a tender from the Philippines indicating a netback of $115/mt FOB to China – they face continued pressure for lower prices.

Looming over any attempt to stem the price drop are reports that the market continues to await the Indonesia amsul tender, for three lots of 25,000 mt, to fully conclude. Netbacks from offers reported in the tender showed a price of $100-$110/mt FOB China.

If the Indonesia deal concludes, sources said prospective buyers will shoot past the $110/mt FOB price and go straight for $100/mt FOB.

Brazil:

The landed price of ammonium sulfate softened to $160-$175/mt CFR, down from last week’s $165-$175/mt CFR, following the decline in the urea market. Amsul and urea are now priced at near-parity on a nitrogen basis, sources said.

Citing low demand, sources reported Rondonópolis prices stable at $295-$310/mt FOB ex-warehouse.

DAP/MAP

Brazil, Central Florida, China, DAP/MAP, Eastern Cornbelt, India, Market Watch, South Central, Southeast, Southern Plains, U.S. Exports, U.S. Gulf, U.S. Imports, Western Cornbelt

Central Florida:

Central Florida DAP trucks were reported at a flat $575/st FOB, rising from last week’s $550-$575/st FOB, while truck-loaded MAP continued at $610/st FOB.

North Florida MAP demand has been strong, with sales volumes reported in line with player expectations. Posted prices increased to $640/st FOB for tons loading from White Springs, Fla., a $15/st rise from $625/st FOB at last report.

US Gulf:

Sources reported prices rising on the NOLA phosphate market, despite a quiet week of trading. DAP barges moved 2% higher, to $560-$575/st FOB from the week-ago $545-$570/st FOB, while MAP prices gained $5/st, firming to $605-$620/st FOB.

US Imports:

DAP imports were up 173.9% in July-October, rising to 703,628 st from 256,916 st in the prior year. October imports moved 221.2% higher, to 219,045 st from the year-ago 68,199 st. July-October imports from Saudi Arabia stood at 454,703 st, while tons shipping from Jordan totaled 119,543 st. Australia added 80,372 st.

MAP/Other imports rose 46.7% in July-October, to 424,537 st from the prior-year 289,322 st. Imports were up 7.4% in October, to 137,137 st from the year-ago 127,673 st. Tunisia sent 128,632 st for the fertilizer year-to-date, ahead of 103,061 st from Saudi Arabia and 85,433 st from Mexico. Australia shipped 81,991 st.

US Exports:

No changes were reported on the US Gulf DAP and MAP export markets, leaving prices at $570/mt FOB for the latest trades.

DAP exports for October stood at 15,926 st, down 59.1% from the year-ago 38,957 st. July-October exports totaled 139,789 st, falling 53.9% from last year’s 303,328 st. US sellers sent 51,291 st of DAP to Peru in July-October, ahead of 22,375 st to Mexico and 20,941 st to Uruguay.

October MAP/Other exports lifted 2.2%, to 156,167 st from the year-ago 152,841 st. July-October exports moved down 10.3%, however, to 557,553 st from 621,894 st in the prior year. Canada received 429,729 st of US MAP in July-October, topping 38,272 st to Australia and 32,651 st to Mexico.

Eastern Cornbelt:

DAP firmed to a broad $610-$635/st FOB range in the Eastern Cornbelt on continued reports of tight supply and strengthening NOLA barge values, up from last week’s $610-$625/st FOB range, with the high confirmed at Cincinnati. MAP remained at $675-$690/st FOB in the region, with the Cincinnati market pegged at the $680-$685/st FOB level.

Michigan phosphate pricing in mid-December included DAP at $665/st DEL, and MAP at $680-$690/st FOB and $715-$720/st DEL.

Western Cornbelt:

DAP firmed again, to $610-$630/st FOB in the Western Cornbelt, up from last week’s $600-$620/st FOB range, with the low reported at St. Louis. MAP pricing fell to $660-$690/st FOB range in the region, with the St. Louis market quoted at $660-$675/st FOB at mid-month.

Southern Plains:

DAP prices jumped to $620-$645/st FOB in the Southern Plains for any available tons, up from the previous $600-$610/st range, with both the high and low reported at Catoosa/Inola. Sources said DAP was “hard to find” in mid-December, with some suppliers referencing prices based on January-February barge arrivals.

MAP dropped to $670-$680/st FOB in the region.

South Central:

DAP prices in the South Central region strengthened to $600-$630/st FOB, up from $590-$610/st FOB in late November, with the high confirmed in Arkansas and the low reported by Kentucky sources out of spot Ohio River terminals. The Memphis, Tenn., DAP market jumped to $625-$630/st FOB for the latest offers, up from $600-$610/st FOB at last report.

Southeast:

Nutrien raised its MAP posting to $640/st FOB at Aurora, N.C., and White Springs, Fla., up from the previous $625/st FOB level.

China:

Small amounts of DAP have reportedly cleared the customs process and are now available for export. Sources put the estimated price at $575-$585/mt FOB.

DAP and MAP will likely represent the bulk of the 5 million mt of fertilizers allowed to ship from China in 2024, sources speculated. The potential netbacks for phosphates are better than for nitrogen fertilizers such as urea, one trader said, giving the DAP/MAP producers an edge.

India:

Government representatives pressured DAP buyers during last week’s meeting of the Fertilizer Association of India to step up and start securing tons, sources reported. The buyers pushed back, noting that due to the government’s cutback on DAP subsidies, the breakeven import price is close to $500/mt CFR. Unfortunately for buyers, the current price is reported at $610-$620/mt CFR.

When asked by the importing companies if the government is ready to cover the $100/mt difference, government officials reportedly promised that buyers would be protected, but gave no commitments to ease the companies’ concerns.

India’s current DAP reserves were reported at 1.7 million mt, sources said, a dangerously low level ahead of the upcoming application season. One trader described the low inventories as the government’s reason for leaning on state-owned companies to increase their DAP imports, regardless of the cost.

Companies reportedly want to wait until February before making commitments to import DAP, one source said. By that time, said the source, the 2024/25 budget will have been released, and firms will have a better idea of the support they might receive from the government if global prices do not decline.

Brazil:

MAP imports fell slightly, to $550-$565 from the week-ago $560-$570/mt CFR. Transactions for delivery in the third quarter of 2024 were reported around the $540/mt CFR mark.

Rondonópolis MAP trades continued in the $680-$685/mt FOB ex-warehouse range, despite attempts by sellers to raise prices to $700/mt FOB or more. Demand remains weak, due both to limited purchases for the corn safrinha and low interest for the region’s 2024/25 soybean harvest.

TSP

Brazil, Eastern Cornbelt, Market Watch, South Central, Triple Superphosphate, U.S. Gulf, Western Cornbelt

US Gulf:

NOLA TSP trading was reported in the $445-$455/st FOB range, unchanged from last week.

Eastern Cornbelt:

TSP was unchanged at $525-$540/st FOB in the Eastern Cornbelt, depending on location, with pricing at Cincinnati and Ottawa, Ill., quoted at the $535/st FOB level in mid-December. TSP pricing in Michigan was pegged at the $570/st DEL level.

Western Cornbelt:

TSP remained at $510-$535/st FOB in the Western Cornbelt, with the low reported at St. Louis.

South Central:

TSP pricing was steady at $520-$535/st FOB terminals in the South Central region, with the low reported at Memphis and the high at Little Rock, Ark.

Brazil:

Imported TSP prices were steady at $420-$440/mt CFR, sources said. Despite low liquidity, the Rondonópolis market moved higher for the week. Prices were indicated in the $555-$560/mt FOB ex-warehouse range, with offers limited to 2024 delivery.

SSP

Brazil, Market Watch, SSP

Brazil:

While landed prices for SSP 19-21 continued in the $190-$205/mt CFR range, the Rondonópolis market softened to $320-$335/mt FOB, slightly below the week-ago $330-$335/mt FOB, with offers focused on 2024 delivery. SSP-23 offers were noted at $380/mt FOB ex-warehouse, off $5/mt from last week.

Phosphoric Acid

Eastern Cornbelt, Market Watch, Phosphoric Acid, Southern Plains, U.S. Exports, Western Cornbelt

US Exports:

Wet-process phosphoric acid exports firmed 47.0% in July-October, to 144,050 st from the year-ago 98,001 st. October cargoes were counted at 11,724 st, a 97.9% increase from the 5,925 st reported one year earlier. India held the top export spot in July-October with 70,241 st, beating 53,569 st to Mexico and 17,416 st to Canada.

Eastern Cornbelt:

December phosphoric acid postings were steady at $11.90/unit rail-DEL in the Eastern Cornbelt.

Western Cornbelt:

The phos acid market was reported at $11.90/unit rail-DEL in the Western Cornbelt for December tons.

Southern Plains:

Phos acid pricing was reported at $11.90/unit rail-DEL for December tons in the Southern Plains, up $1.00/unit from November.

Ammonium Polyphosphate

Ammonium Polyphosphate, Eastern Cornbelt, Market Watch, Southern Plains, Western Cornbelt

Eastern Cornbelt:

The 10-34-0 market was pegged at $520-$530/st FOB in the Eastern Cornbelt, depending on location and time of shipment, with the low end of the range also reported in Michigan on a spot basis.

Western Cornbelt:

10-34-0 remained at $500-$520/st FOB in the Western Cornbelt for the latest offers.

Southern Plains:

10-34-0 was unchanged at $495-$500/st FOB in the Southern Plains, with the 11-37-0 market quoted at $515-$545/st FOB in Texas.