All posts by hlancey@bloomberg.net

Trammo to Buy Renewable Ammonia from Allied

Australia, Clean Ammonia, Green Ammonia, Low-Carbon

Independent ammonia trader Trammo announced that it has signed a memorandum of understanding (MoU) between its French subsidiary, Trammo SAS, and Allied Green Ammonia Ltd. (AGA) to purchase up to 100% of the renewable ammonia generated by AGA’s green ammonia facility under development in Australia’s Northern Territory.

The AGA facility will be located on Australia’s Gove Peninsula and is expected to produce up to 950,000 mt/y of green ammonia. The project was announced in 2023 as a development between AGA and Spanish global engineering company Técnicas Reunidas SA (GM Sept. 29, 2023).  First sales are expected in late 2028.

Plug Power recently signed an MoU with AGA for the supply of a PEM electrolyzer with up to 3 GW electrolyzer capacity for the project (GM May 10, p. 27). AGA also recently announced a supply agreement for two large-scale 40,000 mt cryogenic double-wall ammonia storage tanks from SPG Steiner, a German-based EPCM contractor.

Morocco Approves Green Hydrogen/Ammonia JV

Australia, Clean Ammonia, Europe, Green Ammonia, Green Hydrogen, Low-Carbon, Morocco

A joint venture between Australian-based Fortescue Energy and state-owned OCP Group of Morocco has been approved by Morocco’s Competition Council. The 50-50 joint venture was announced in April and is expected to produce green ammonia, hydrogen, and fertilizer products in Morocco that will serve Morocco, Europe, and other international markets (GM April 12, p. 25).

The joint venture is part of OCP Group’s $13 billion Green Investment Program. It is expected to encompass four projects that include integrated production of green fertilizer and ammonia from renewable energy sources and electrolysis, the manufacturing of green technology and equipment, and an R&D Hub located near Mohammed VI Polytechnic University in Marrakesh.

Mitsubishi Inks Low-Carbon Ammonia MOUs

Ammonia, Clean Ammonia, Green Ammonia, Green Hydrogen, Japan, Low-Carbon, South Korea

Japanese-based Mitsubishi Heavy Industries (MHI) has signed two Memorandums of Understanding (MoUs) to further its interests in green ammonia. Mitsubishi Power, a power solutions brand of MHI, has signed an MoU with India’s Hygenco Green Energies to explore green hydrogen and green ammonia-fired gas turbine combined cycle (GTCC) power plants.

The agreement includes supplying green fuel for Mitsubishi Power’s GTCC technology and developing commercially viable green hydrogen and ammonia production assets on a “build-own-operate” or a “gas as a service” basis.  The partnership is backed with financial support from the Japan International Cooperation Agency.

Parent company MHI also signed an MoU with Taiwan Fertilizer Company (TFC). As part of the agreement, MHI and TFC will conduct a joint pre-feasibility study that explores the establishment of an ammonia fuel value chain in Taiwan. This will include assessing ammonia receiving, storage, handling, delivery to power plants, and using ammonia as a fuel for power generation in support of Taiwan’s “2050 Net-Zero Emissions” goal.

TFC recently signed MoUs furthering its interests in ammonia with both Samsung C&T Corp. of South Korea and IHI Corp. of Japan (GM Aug. 2, p. 25).

Chivas, Simpsons Malt Invest in Low-Carbon Ferts

CAN, Clean Ammonia, Low-Carbon

Chivas Brothers, the whiskey producer based in Paisley, Scotland, and its distilling wheat supplier, Simpsons Malt Ltd., have announced an investment in OCI Global’s low-carbon fertilizer. A select number of farmers in the Chivas Brothers Wheat Growers Group are trialing the low-carbon calcium ammonium nitrate (CAN) fertilizer, Nutramon® Low Carbon.

OCI has stated that its Nutramon® Low Carbon fertilizer is produced using certified bio-gas and will have a carbon footprint of up to 50% less than conventionally produced fertilizers. The product will be used in wheat and malted barley crops from August to October 2024 as part of the trial.

News of the collaboration comes on the heels of other announcements between food and beverage organizations and low-carbon fertilizer manufacturers. Yara recently signed an agreement with PepsiCo in Europe for low-carbon fertilizers (GM July 19, p. 1), and Nestlé has been trialing low-carbon fertilizers produced from cocoa shells supplied by Cargill (GM Sept. 15, 2023).

Bureau Veritas Partners on Ammonia-Fueled Vessels

Ammonia, Clean Ammonia, France, Low-Carbon, South Korea

Bureau Veritas, the global certification organization based in France, has partnered with Hanwha Ocean and Naftomar to develop vessels with an ammonia fueled prepared design. The project aims to advance decarbonization of shipping through developing a vessel optimized for ammonia fueling utilization, including fueling from low-carbon ammonia.

Other certifying organizations have sought to participate in the maritime use of low-carbon ammonia as a fuel. Det Norske Veritas (DNV) earlier this year approved a Fortescue vessel to use ammonia as a marine fuel (GM March 22, p. 27), and Lloyd’s Register collaborated with Mitsubishi Heavy Industries in 2021 on using ammonia as a shipping fuel (GM April 30, 2021).

The South Korean-based consortium Hanwha Corp. recently announced their intention to collaborate with INEOS Nitriles to study a low-carbon ammonia facility with carbon sequestration in the US that is expected to produce up to 1 million mt/y of ammonia (GM May 31, p. 24).

Ammonia

Ammonia, Brazil, Eastern Cornbelt, India, Indonesia, Market Watch, Middle East, Northwestern Europe, South Central, Southern Plains, Tampa, U.S. Gulf, Western Cornbelt

US Gulf/Tampa:

No indications were reported for the Tampa ammonia price for September, though European natural gas prices have soared to their highest level this year and the latest fall pricing offers in the Cornbelt have edged up to $520-$550/st FOB, depending on location.

Eastern Cornbelt:

Ammonia in the Eastern Cornbelt remained at $520-$550/st FOB for prompt or fall prepay tons, with the high confirmed in northern Illinois. No current prices were available at Lima, Ohio.

Western Cornbelt:

Ammonia prompt and fall prepay offers edged up to $520-$550/st FOB in the Western Cornbelt, with both the high and low reported in Nebraska during the week, depending on location. Most Iowa terminals remained firmly at the $525/st FOB level, with the Palmyra, Mo., market quoted at $520/st FOB in early August.

Southern Plains:

The ammonia market was quoted at $490/st FOB Oklahoma terminals and $500/st FOB in Kansas for prompt or fall prepay. Truck pricing out of Gulf Coast production points was pegged at the $430/st level following the August Tampa ammonia contract.

South Central:

No ammonia offers were reportedly on the table for truck tons from El Dorado, Ark., Midway, Tenn., or Cherokee, Ala., in early August.

Northwest Europe:

No further spot business was reported in the region this week, leaving the regional market unchanged at $510-$550/mt CFR.

Natural gas prices in Europe have strengthened to just shy of $12/MMBtu, however, fueled by residential cooling demand and concerns around the Russian gas pipeline following Ukraine’s incursions across the border. Higher FOB price ideas in North Africa also appear to support existing price levels.

India: 

The ammonia market is awaiting the results of the 15,000 mt FACT tender that closed on Aug. 5. Sources said three offers were made in the tender. So far, no prices have been released.

Middle East: 

Ammonia discussions are now focused in the $350s/mt FOB, sources said, though no spot business was reported. Product is reportedly tight, but loosening as production ramps up.

Indonesia:     

Indonesia exported 896,000 mt of ammonia in January-June, Trade Data Monitor reported, up 7% from the 836,000 mt shipped through the first half of 2023. South Korea took 275,000 mt, followed by China with 175,000 mt.

June exports were 148,000 mt, up 8% from 137,000 mt in June 2023, while second-quarter exports of 442,000 mt were off 4% from 459,000 mt in April-June 2023.

Brazil:

Brazil exports ammonia when it has an excess of product or when the price is advantageous. Trade Data Monitor put January-July exports at just 120 mt, down from the year-ago 48,000 mt, with all of the tons going to Uruguay. July exports were 40 mt against 15,000 mt in July 2023.

January-July ammonia imports were noted at 230,000 mt, a 30% increase from the 190,000 mt received during the first seven months of 2023. July imports were 45,000 mt, up significantly from 19,000 mt in July 2023.

Urea

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

US Gulf:

NOLA urea trades were reported at $305-$315/st FOB for August barges during the week, with the higher numbers confirmed on Aug. 8. Limited September business was quoted at the $308/st FOB level earlier in the week. This week’s range was down slightly from last week’s $307-$317/st FOB for August barges.

Eastern Cornbelt:

Urea dropped to $360-$370/st FOB in the Eastern Cornbelt, down $5/st from last week, with the low confirmed at Cincinnati, Ohio.

Western Cornbelt:

Urea pricing widened to $345-$370/st FOB in the Western Cornbelt, with the low reported at St. Louis, Mo., and the high at Caruthersville, Mo., and out of spot Iowa terminals.

Southern Plains:

Urea edged up to $360-$370/st FOB Catoosa/Inola, Okla., and $385/st FOB Houston, Texas, up slightly from the prior $355-$365/st FOB range at Catoosa/Inola.

South Central:

The urea market widened to $330-$375/st FOB terminals in the South Central region, with the low confirmed at Convent, La., and the high in Arkansas. Pricing at Memphis, Tenn., was reported at $365-$370/st FOB during the week, reflecting a $10/st increase.

Southeast:

Urea pricing in the Southeast dipped to $365-$370/st FOB port terminals in early August, down $5-$10/st from last report.

India: 

Sources said the Indian government planned to issue a new urea tender this week. The Department of Fertilizers (DoF) was engaged in talks with Morocco for DAP imports during the week, however, and will now likely call the tender next week, said traders.

Even though India will need more urea to meet its needs for the current season, the 10 million mt it has in reserves plus the tons coming in from its most recent tender will give buyers some breathing space. There is a greater immediate need for DAP than urea in the country, prompting the DoF to focus on that issue instead.

Only two cargoes awarded in the previous urea tender have yet to receive a vessel nomination, sources said. The ships are expected to be named soon, giving India an earlier window to call its next tender. Sources speculated that National Fertilizers Ltd. (NFL) will be responsible for the new tender and that it will be seeking at least 1 million mt.

Reports that prices are softening in the Arab Gulf as reserves build in producers’ warehouses are an encouraging sign to buyers in India. The Middle East is once again expected to act as the primary supplier for the tender, as there has been little indication that China will release large quantities of urea for export anytime soon.

Pakistan:       

The recent Trading Corp. of Pakistan (TCP) tender for 150,000 mt of urea has settled with a $358.99/mt CFR award to West Trade. Sources said the company appears to be ready to supply 100,000 mt, with the first lot to be shipped in mid-August.

On the heels of the award, the government approved an additional tender to be called for 100,000 mt. Sources said the permission came after TCP attempted to secure government-to-government deals with Azerbaijan, Turkmenistan, and China. Talks reportedly remained underway with producers in the latter two countries.

The price awarded to West Trade is reportedly higher than the current domestic price in Pakistan. According to local media reports, the government is planning to add an additional $20 million in subsidies to ease the financial burden on buyers.

Per the agreement between Pakistan’s government and the International Monetary Fund (IMF), however, none of the IMF’s support money may be used to cover that subsidy. Media reports suggested that local governments may be asked to pick up the tab.

Black Sea:     

The price of prilled urea softened slightly in the Black Sea, widening the range to $300-$310/mt FOB.

Mediterranean:

Urea offers in the Mediterranean basin slid lower this week, to around $380/mt CFR amid muted demand and improved availability ex-Egypt. Spanish and Italian importers remain on the sidelines, while offers in nearby Romania were heard at $385/mt CFR. As a result, the granular urea market in the Mediterranean slipped to $380-$385/mt CFR, down from $385-$390/mt CFR.

Southeast Asia:

No further spot granular urea business was reported in the region, as Malaysia focuses on contract shipments and Indonesia has no availability. Downward pressure on the market is present, however, with CFR bids and sales in nearby markets reflecting lower levels achieved on an FOB basis. For now, however, the market remains unchanged at $350-$366/mt FOB.

Indonesia:     

Bad weather, including unusually high humidity during both the day and night, has caused a delay to shipments of urea purchased in June. One trader reported having a vessel awaiting a berth for at least 15 days due to the delay in loading ships.

The June sales were initially slated to load no later than mid-July. Issues with transportation to the ports and now delays in vessel loadings have pushed back the shipping dates.

Once the last of the vessels begin loading, sources said Pupuk will once again begin issuing selling tenders. Traders expect to see significant quantities of material coming out of not only Indonesia by mid-September, but also neighboring Bahrain and Malaysia as well.

January-June urea exports firmed 29% year-over-year, according to Trade Data Monitor, to 826,000 mt from 642,000 mt. Australia led buyers with 410,000 mt, followed by the Philippines with 119,000 mt. June exports stood at 210,000 mt, up 37% from 153,000 mt in June 2023. Shipments were down 9% in the second quarter, however, to 485,000 mt from 535,000 mt.

Middle East: 

The Middle East urea price remained steady in the low-$340s/mt FOB due to a lack of new spot business. Producers were busy covering both the last of the Indian tender awards and their long-term contracts. Two vessels were reported to begin loading this week, though two more ship nominations are still needed to close out the tender awards from the Arab Gulf.

Producers were reportedly more willing to talk with traders this week about potential upcoming deals, including the next Indian tender, though differences in price ideas remain a stumbling block. Some bids are reportedly coming in the $320s/mt FOB, while producers are looking to hold on to the current price in the $340s/mt FOB, at a minimum.

“So far,” said one trader, “talks are friendly and without acrimony.”

For West Trade to cover its award into Pakistan, sources said the company will be forced to rely on Iranian material. A recent tender for 100,000 mt of Iranian granular urea showed prices in the $290s/mt FOB. Some bids heard in the $280s/mt FOB were reportedly slated for sale to buyers in Latin America.

No awards have yet been issued in the tender, leaving the last price of $296/mt FOB as the benchmark for Iranian product.

Sources continue to wonder what will happen with the reported 100,000 mt being shipped to Chinese warehouses. In the past, such tons were stored in bonded warehouses – never officially entering the Chinese market – and then parceled out in smaller lots to regional buyers.

Egyptian production is nearly back to normal, reports indicated. Only MOPCO, which is running two of its three plants, continues to operate below normal capacity.

China:

Following talks with traders and producers in China, international traders put the odds of large-scale exports being allowed anytime soon at just 30%.

The Chinese application season begins in September, sources noted. The goal of China’s export restrictions was to ensure a plentiful supply of urea at a cheap price. So far, while reserves are slowly building, prices have not come off enough to satisfy the government officials responsible for lifting the export restrictions.

The application season is expected to run through November, with some possible interest lingering into mid-December. This schedule, said one trader, leaves the impression there will be no major exports from China for the rest of the year. Other traders are a bit more optimistic, however, speculating that while the large export quantities seen in the past may not be repeated, the government will allow for a gradual increase in urea shipments in the last quarter of the year.

Domestic prices have been dropping. The latest export estimate, based on domestic prices from the factory, showed an equivalent of $310/mt FOB from some plants. At the same time, however, the bulk of estimates suggests a price in the mid-$320s/mt FOB.

TCP in Pakistan is reportedly in serious talks to secure 100,000 mt as part of a government-to-government deal. If the basis for the deal centers on the last TCP tender price of about $359/mt CFR, sources said producers could see a netback of around $330/mt FOB. There are no reports indicating the progress of the talks, only that TCP is looking at all options to secure the tons needed by Pakistan.

Ethiopia:       

Ethiopia imported 502,000 mt of urea in January-July, Trade Data Monitor reported, up 26% from the 398,000 mt received in January-July 2023. Egypt supplied 304,000 mt and Oman shipped 155,000 mt. July imports totaled just 28 mt, compared to the 148,000 mt reported one year earlier. Ethiopia typically imports less urea in the third quarter than other periods of the year.

Brazil:

Granular urea imports dropped 5.5% during the week, to $340-$345/mt CFR, with sanctioned urea reportedly available at a $15-$20/mt discount. Offers continued in the $350-$365/mt CFR range, however, with sellers anticipating a new India tender soon.

Despite lower prices at ports, domestic market negotiations remained stable at $480-$500/mt FOB Rondonópolis for September and October deliveries, with quotes for immediate delivery tracking slightly lower.

July urea imports fell 8% year-over-year, Trade Data Monitor reported, to 600,000 mt, reflecting reduced imports from Qatar and Oman. Imports rose to 3.6 million mt in January-July, however, a 5% increase from the same period of 2023. Nigeria supplied 782,000 mt, Qatar shipped 635,000 mt, Oman sent 627,000 mt, and Russia added 480,000 mt.

UAN

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

US Gulf:

The latest UAN barge indications continued in the $202-$205/st ($6.31-$6.41/unit) FOB NOLA range, though no actual trades were confirmed during the week. “UAN is a ghost town,” commented one NOLA contact.

Eastern Cornbelt:

The latest UAN-32 offers in the Eastern Cornbelt reportedly slipped to $240/st ($7.50/unit) FOB Mount Vernon, Ind., and $245-$248/st ($7.50-$7.75/unit) FOB Cincinnati, reflecting a slight decrease from last report. The upper end of the regional market was pegged at $255-$265/st ($7.97-$8.28/unit), depending on location.

The UAN-28 market at Cincinnati was reported at the $217/st ($7.75/unit) FOB level in early August.

Western Cornbelt:

UAN-32 dropped to $240-$260/st ($7.50-$8.13/unit) FOB regional terminals in the Western Cornbelt, depending on location, with the low confirmed at St. Louis and Port Neal, Iowa.

Southern Plains:

UAN-32 prices in the Southern Plains retreated to late June fill levels, with the latest offers reported at $222/st ($6.94/unit) FOB Verdigris, Okla., $232/st ($7.25/unit) FOB Woodward, Okla., and $235-$250/st ($7.34-$7.81/unit) FOB Gulf Coast terminals in Texas.

South Central:

UAN-32 was quoted in the $225-$240/st ($7.03-$7.50/unit) FOB range out of South Central terminals for the last sales, with the low reported in Louisiana and the high out of Ohio River terminals in Kentucky.

Southeast:

The latest UAN-32 prices were pegged at $235-$250/st ($7.34-$7.81/unit) FOB in the Southeast, down $5/st from last report, with the low confirmed out of port terminals and the high at inland terminals in Georgia.

France:

No fresh sales were reported at Rouen, where UAN activity is lackluster. Prices were unchanged at €245-€265/mt FCA this week.

Ammonium Nitrate

Ammonium Nitrate, Brazil, Market Watch, Southeast, Southern Plains, United Kingdom, Western Cornbelt

Western Cornbelt:

Ammonium nitrate prices remained at $240-$250/st FOB in Missouri in early August.

Southern Plains:

The ammonium nitrate market dropped to $280/st FOB for recent offers in Oklahoma, down $10/st from last report.

South Central:

The latest ammonium nitrate prices in the South Central region were reported at $230/st FOB El Dorado and Yazoo City, Miss. Most other warehouses in the region were empty in early August, sources said.

Southeast:

The ammonium nitrate market at Tampa reportedly slipped to $295-$305/st FOB for the latest offers, down from $305-$310/st FOB.

United Kingdom:

CF in the UK is reportedly committed on ammonium nitrate through September at the price of £330/mt CPT. The producer is rumored to be offering December volumes at £340/mt CPT. For how, however, ammonium nitrate in the UK is unchanged at £330/mt CPT.

Brazil:

Trade Data monitor reported January-July ammonium nitrate imports at 456,000 mt, down about 15% from the 536,000 mt received through the same period of 2023. Russia supplied 410,000 mt, accounting for 90% of the year-to-date total. July imports were counted at 102,000 mt, down from 128,000 mt in July 2023.

Ammonium Sulfate

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

US Gulf:

NOLA ammonium sulfate barges were reported at $280/st FOB for the latest indications, reflecting the high end of last week’s $270-$280/st FOB range.

Eastern Cornbelt:

Granular ammonium sulfate was pegged at $325-$350/st FOB in the Eastern Cornbelt, with the upper end confirmed at Cincinnati.

Western Cornbelt:

Granular ammonium sulfate widened to $325-$370/st FOB in the Western Cornbelt, depending on location. Most locations were reported at $345/st FOB or higher in early August.

Southern Plains:

Granular ammonium sulfate remained in a broad range at $345-$410/st FOB in the Southern Plains, with the low reported at Houston and the high at Catoosa/Inola from some suppliers.

PCI Nitrogen’s production facility at Pasadena, Texas, reportedly restarted early in the week after shutting down on July 8 ahead of Hurricane Beryl (GM July 12, p. 1). The facility was not yet up to full production rates on Aug. 8, however.

South Central:

The latest granular ammonium sulfate prices in the South Central region edged up to $335-$375/st FOB, with the low reported at Memphis and the high in Arkansas.

Southeast:

AdvanSix launched a summer fill program for ammonium sulfate in the eastern US. Posted prices FOB Hopewell, Va., for orders placed on Aug. 5-8 and pulled by Oct. 31 included granular at $295/st FOB, mid-grade at $275/st FOB, and standard at $255/st FOB. Prices were slated to go up $20/st on Aug. 9.

Northwest Europe:

Sources reported small ammonium sulfate sales at range-bound levels in Northwest Europe this week. Producers are reportedly committed through the summer, but demand is muted, resulting in a balanced market and flat prices at $160-$170/mt FOB.

China:

The price of caprolactam grade amsul at China widened this week on both softer nitrogen prices and tightening supply. Sources now put the export price at $135-$145/mt FOB.

Producers are reportedly sold out for the rest of August, with some fully committed into mid-September. Bulk buyers reported difficulty not only getting enough amsul to cover their needs, but also procuring other related commodities such as MAP to properly fill a combination order for a larger vessel.

Brazil:

Granular ammonium sulfate moved up slightly in Brazil, to $170-$178/mt CFR from last week’s $170-$175/mt. Citing increased raw material costs from China, some sellers are pushing for firmer prices in the next round of business.

Despite international pressure, the domestic market remained stable at $290-$300/mt FOB Rondonópolis. NPK 20-00-20 demand for the second corn crop remained high, with pricing quoted at $390/mt FOB.

Ammonium sulfate imports fell 6% in January-July, according to Trade Data Monitor, to 1.7 million mt from the year-ago 1.8 million mt. While tons from China – representing 96% of Brazil’s total amsul imports ­– showed a 1% year-over-year increase, receipts were down from other sources. July imports firmed 16% to nearly 310,000 mt, with 98% of the tonnage shipping from China.