US Gulf:
NOLA urea prices
continued to cover a broad range, but sources said the market was slipping
slightly with each new trade.
March business was
quoted at $382-$392/st FOB during the week, with first-half April trades
reported at $353-$358.50/st FOB. Prices were lower further out into April,
however, with full-April business reportedly concluded at the $340/st FOB level
during the week. Those levels were down from last week’s range of $354-$406/st
FOB for March and first-half-April business.
Eastern Cornbelt:
Urea remained at the $450-$460/st level FOB regional
terminals in the Eastern Cornbelt, with the low reported out of spot Illinois
River terminals and the upper end of the range confirmed at Cincinnati, Ohio.
In the Great Lakes region, the latest urea offers in Michigan slipped to
$490/st FOB or DEL for March-April tons.
Western Cornbelt:
Urea prices were quoted at $450-$465/st FOB in the
Western Cornbelt, with the high confirmed in Iowa and the low reported at St.
Louis, Mo.
Northern
Plains:
Urea was quoted at $480-$500/st FOB in the
Northern Plains, with the lower end of the range reported at St. Paul, Minn.
Delivered urea was pegged at $540-$560/st for the last offers in the Northern
Plains.
Northeast:
Urea
prices were higher in the Northeast. The latest urea offers were pegged at
$465/st FOB East Liverpool, Ohio, $460-$470/st FOB Baltimore, Md., and
$450-$460/st FOB Fairless Hills, Pa. Rail-DEL pricing in New England was quoted
in the $485-$500/st range in late March.
Eastern
Canada:
Urea
pricing slipped to a broad C$640-$725/mt FOB in Eastern Canada, with the low
end of the range reflecting a C$60/mt drop from last report.
India:
The
Rashtriya Chemicals and Fertilizers Ltd. (RCF) urea tender closed on March
27 with 19 companies offering a total of 3.2 million mt. East Coast offerings
totaled 1.4 million mt, while West Coast offers were 1.8 million mt. The lowest
price for West Coast delivery came from Liven with 50,000 mt at $339/mt CFR.
The lowest East Coast offer came from Samsung at $347.70/mt CFR with 90,000 mt.
The
proposed tonnage was said to include some double offers, which could reduce the
total amount of urea offered to 2.5 million mt or less. The tonnage is in line
with the average of the five Indian tenders conducted in 2023. Only the October
2023 and January 2024 tenders were conducted during China’s restrictions on
urea exports, however.
The
current tender is not expected to involve more than one or two cargoes of
Chinese product. The bulk of the material is expected to come from the Arab
Gulf, and possibly Russia.
|
West Coast India Offers
| |
|
Offering Company
| Quantity | $/mt CFR | |
| |
|
Agrifert Liven
| 50,000 |
339.00
| | |
| OQ Trading | 360,000 |
340.20
| | |
|
Samsung
| 90,000 |
340.70
| | |
|
Continental
| 100,000 |
341.00
| | |
| Agri Commodities | 150,000 |
342.00
| | |
| Aditya Birla | 200,000 |
344.00
| | |
|
Alkagesta
| 35,000 |
344.00
| | |
|
Medallion
| 50,000 |
345.45
| | |
|
Dreymoor
| 50,000 |
346.00
| | |
|
Fertiglobe
| 45,000 |
348.00
| | |
|
Ameropa
| 94,300 |
349.50
| | |
|
Indagro
| 47,000 |
351.00
| | |
|
Midgulf
| 150,000 |
351.19
| | |
| Hexagon Fertilizers | 100,000 |
352.52
| | |
|
Koch
| 95,000 |
353.20
| | |
|
FertiStream
| 50,000 |
356.00
| | |
|
Keytrade
| 77,000 |
360.00
| | |
|
MacroSource
| 50,000 |
368.48
| | |
|
Total
| 1,793,300 |
| | |
|
East Coast India Offers
|
|
Offering Company
| Quantity | $/mt CFR |
|
Samsung
| 90,000 |
347.70
|
|
Dreymoor
| 120,000 |
348.00
|
| Aditya Birla | 200,000 |
349.50
|
| OQ Trading | 90,000 |
351.75
|
|
Continental
| 100,000 |
352.25
|
|
Fertiglobe
| 45,000 |
353.00
|
| Hexagon Fertilizers | 50,000 |
354.52
|
|
Ameropa
| 94,300 |
355.00
|
|
Medallion
| 50,000 |
355.45
|
| Agri Commodities | 45,000 |
355.50
|
|
Indagro
| 47,000 |
356.00
|
|
Midgulf
| 150,000 |
356.19
|
|
FertiStream
| 50,000 |
359.00
|
|
Koch
| 95,000 |
362.00
|
|
Keytrade
| 32,000 |
370.00
|
|
MacroSource
| 50,000 |
372.48
|
| RE Energy | 50,000 |
375.25
|
|
Total
| 1,358,300 |
|
Two
companies with direct ties to producers – OQ Trading and Fertiglobe – only
offered tons on a delivered basis. At least one Arab Gulf producer will
typically present an FOB offer to set the tone for where producers think the AG
price should settle.
As soon as the offered tonnage was revealed, traders moved to ascertain where pricing might land. Some initially predicted a price as low as $315/mt CFR, which would indicate an essentially flat market compared to the last tender. Within hours, however, the discussion firmed into the low- to mid-$340s/mt CFR.
In
the end, the average West Coast price was $330.12/mt CFR, about $14/mt higher
than the previous tender. The East Coast average price was $357.27/mt CFR, or
almost $30/mt above the National Fertilizers Ltd. (NFL) tender from January.
As
the lowest offering companies, Samsung and Liven are committed to supplying the
50,000 mt and 90,000 mt they respectively offered. The amount of tonnage taken
by RCF will most likely depend on the price, players said previously. Had
prices settled in the $330s/mt CFR, sources said the buyer would try to
purchase as many tons as possible, with the potential goal of nabbing 2 million
mt. Now, however, the price indicates RCF may take less than 1 million mt.
India
is under no pressure to buy large quantities of urea at this time, as the
country’s urea reserves reportedly stand at around 7 million mt. If RCF takes
less than 1 million mt, it will still show local distributors and farmers that
the government is ensuring a plentiful amount of urea for the upcoming
application period, a move that could force international prices lower. A
subsequent tender in late May or early June could see softer prices as global
reserves build, especially with the return of China to the global market.
Urea
imports fell significantly in January, according to Trade Data Monitor,
to 401,000 mt from 1.3 million mt in January 2023. Russia led suppliers
with 199,000 mt, while Oman added 110,000 mt.
The
tonnage was comprised of the final awards from the October 2023 tender – which
featured a late-December shipping deadline – and monthly purchases made under
contract with OMIFCO. The impact of China’s export restrictions was evident in
the month’s numbers. India received 254,000 mt from China in January 2023, but
imported no Chinese urea in January 2024.
Black
Sea:
Prilled
urea prices in the Black Sea were steady at $300/mt FOB.
Sources
expect Russian material to make up a large part of the Indian tender awards.
While some material might come out of the Black Sea, most of the Russian urea
offered is expected to ship from Baltic ports, as sources noted limited rail
capacity to move urea to the far eastern portion of the Black Sea for safe
loading.
Mediterranean:
The
Mediterranean urea market was largely illiquid this week as buyers awaited
direction from the Indian tender before making further purchase decisions.
Spain and Italy were still consuming existing stocks and France saw retail
offers that would net back to around $370/mt CFR, which reflects the high end
for this week. The lower end of the range reflects business into Romania done
at around $360/mt CFR for product of unspecified origin.
New
indications from Egypt at $330-$335/mt FOB would reflect close to $365/mt CFR
in the Mediterranean, which is this week’s midpoint. No new prilled urea
business was reported for industrial use in the region, but the range tilted
lower to $360-$380/mt CFR based on granular trends.
Indonesia:
Pupuk
closed a tender through PT Pupuk Sriwidjaja
Palembang (Pusri) on March 26 for 5,000 mt of prilled urea. Universal, of the
Philippines, snagged the deal at $349/mt FOB.
Pupuk
has permission to ship an additional 5,000-10,000 mt of urea, sources said, and
another prilled tender is likely to be called soon. The tender, which may not
come until after the April 10 Eid holiday, will be for the remaining prilled
product.
Pupuk
has been offering only prilled urea in accordance with government efforts to
ensure a plentiful supply of granular for the domestic market. Additionally,
with Pupuk restricted to shipping only small lots of material, potential buyers
are effectively limited to those in the Southeast Asia region. Pupuk is
expected to offer 30,000 mt of granular urea for buyers located farther afield
once new permits are issued.
The
lack of any granular exports has left the market to calculate an estimated
granular price based on the prilled deal. Granular urea usually maintains a
$5-$10/mt premium to prilled, leaving the estimated granular price at
$354-$359/mt FOB.
Southeast Asia:
No
further granular export business could be confirmed in the region, with Pupuk
Indonesia not yet having additional export licenses for granular material but
reportedly selling prills. The last granular business was done at $386/mt FOB a
month ago, but indications have slipped to $340-$360/mt FOB since then based on
prilled business.
Malaysia’s
Gurun and Bintulu plants have now returned to full operation. The output from
the facilities will go directly to fulfilling contracted deals, sources said,
leaving nothing for the spot market. Players reported an inquiry in the vessel
market to take 30,000 mt of Petronas product to Chile in mid-April.
Thailand
imported 437,000 mt of urea in January-February, Trade Data Monitor
reported, more than doubling its year-ago 195,000 mt take. Saudi Arabia
accounted for 52% of the imports with 228,000 mt, Malaysia sent 56,000 mt, and
Oman added 47,000 mt.
February
imports stood at 192,000 mt, up 45% from the 133,000 mt received in February
2023, with Saudi Arabian material capturing 47% of the month’s total. The
dominance of Saudi Arabian urea in the Thai market is unsurprising, as Thai
buyers are reportedly given substantial discounts by Saudi producers. The CFR
price in Thailand is often equal to the FOB price that Saudis quote to other
buyers, sources have said.
Middle
East:
Sources
are waiting for the prices to be revealed in the RCF urea tender. If either OQ
or Fertiglobe present an FOB price, that will give players an indication of
where producers think the market should be. At the same time, the landed offers
into the Indian West Coast will show where everyone else sees the market.
If the Indian price falls in the mid-$340s/mt CFR, as is being discussed, Middle East netbacks could land in the $325-$335/mt FOB range. An outlier offer sub-$340/mt CFR could take the netback closer to $320/mt FOB or below. Producers will have to decide if holding on to a price near $330/mt FOB is worth losing business, and possibly facing even lower prices in a subsequent tender.
The
paper market is already looking at a softer Middle East price. Sources reported
June price speculation at $310/mt FOB, and $302-$305/mt FOB for the third
quarter.
There
were multiple reports that some Egyptian producers have concluded deals at
$330-$335/mt FOB with buyers filling short orders into Europe. Each sale was
noted at 3,000-6,000 mt. Publicly, the producers continue to claim they are
holding steady at $340/mt FOB, and that any discussion of pricing in the
$330s/mt FOB is just talk.
Despite
the denials by the Egyptian producers, sources reported an increase in vessel
inquiries seeking to move material from Egypt to Europe.
China:
The
domestic urea price in China has continued to fall. The export-equivalent price
is now pegged at $306-$309/mt FOB for prills and $324-$328/mt FOB for granular.
Sources
stressed that these prices are merely estimates of what urea prices would be
based on the ex-plant price, plus costs to transport the tons to a bonded
warehouse and complete the export paperwork. No deals to export urea have been
done at this time, however. Sources have pointed out that efforts to get a head
start on the customs paperwork so shipments can begin in May are being rebuffed
by customs officials.
Despite
the inability to apply for clearance to export urea in May, sources said
producers continue to predict an export price in the $350s/mt FOB once exports
resume.
One
trader described the large gap between the domestic and export prices as
unsurprising. The producers that are given export allocations will look to
increase their margins as much as possible.
The trick for the exporters is to ensure that the higher international price does not have a blowback effect on the domestic market. Sources have said that if the Chinese government sees domestic prices rising too rapidly, officials could quickly reinstate export restrictions until the price drops.
The
government’s reluctance to allow the export paperwork to move ahead is an
indication to traders that only one or two cargoes of urea already held at
bonded warehouses will be included in the RCF tender.
Brazil:
Granular
urea prices pressed 4.9% lower at Brazil, to $335-$345/mt CFR from last week’s
$355-$360/mt CFR, with multiple lots reportedly transacting. Bids reported at
$325/mt CFR failed to attract sellers.
Following
the weaker pricing in the Brazil CFR and international markets, Rondonópolis
prices edged lower as suppliers attempted to stimulate corn safrinha demand.
Business was reported in the $475-$500/mt FOB ex-warehouse range during the
week.
Argentina:
January-February
urea imports to Argentina totaled 160,000 mt, Trade Data Monitor
reported, a significant increase on the 13,000 mt received through the same
period of 2023. Nigeria sent 86,000 mt, ahead of 42,000 mt from Algeria.
February imports of 10,000 mt – all from Bolivia – represented a marginal
increase from 9,500 mt in February 2023.
