All posts by mickeybarb@charter.net

Tatarstan’s Ammoni Produces 450K of AN in 2022

Ammonium Nitrate, News, News Briefs, Russia

Tatarstan Republic (Russia)-based nitrogen fertilizer and methanol producer JSC Ammoni produced some 450,000 mt of ammonium nitrate (AN) in 2022, according to a FertilizerDaily report, citing the Mendeleev News telegram channel.

In total, the Mendeleev-based producer produced 1.2 million mt of nitrogen fertilizers, according to the report.

Ammoni has nameplate capacity for the production of 715,000 mt/y of ammonia without methanol production, or 487,300 mt/y of ammonia with integrated production (and 233,800 mt/y of methanol), 717,500 mt /y capacity for granular urea, and 380,000 mt/y of AN, according to the company’s website.

The company in 2021 announced plans to build a new ammonia and urea production facility, and in March of that year set up a subsidiary Ammoni 2 LLC to act as the operator for the new production facility (GM April 9, 2021).

The Ammoni 2 project was planned to include 3,500 mt/d of ammonia production capacity or annual capacity of 1.3 million mt/y, and a granular urea production facility with 4,200 mt/d capacity or annual capacity of 1.5 million mt/y. Construction had been targeted to start at the end of 2021 or the beginning of 2022, but the current status of the project is unclear.

JSC Ammoni came under new ownership in July 2020, when its biggest creditor and 22.8% shareholder, Russian state development bank corporation VEB.RF, closed a deal to sell 100% of the company to Russian fertilizer and chemicals producer Kemerovo Azot (GM July 24, 2020).

India Provides Timeline to Switch to Green Fertilizer

Green Ammonia, Green Hydrogen, India, News, News Briefs

India’s Union Cabinet approved a National Green Hydrogen Mission on Jan. 4 that seeks to spend $2.4 billion to produce at least 5 million mt/y of green hydrogen by 2030 with an associated renewable energy capacity addition of 125 GW. The 5 million mt/y would be used to replace the estimated 5 million mt/y that is currently being used in India, with some 99% of usage currently estimated to be going for petroleum refining and the manufacture of ammonia for fertilizers.

The Ministry of New and Renewable Energy (MNRE) said on Jan. 13 that the overarching objective of the mission is to make India the global hub for production, usage, and export of green hydrogen and its derivatives. The MNRE report said global demand of over 100 million mt of green hydrogen and its derivatives is expected by 2030 and that India is aiming for about 10% of the global market, i.e. able to export 10 million mt/y of green hydrogen/ammonia.

The Ministry of Chemicals and Fertilizers is to encourage adoption of indigenous green ammonia-based fertilizers for progressively replacing imports of fertilizers and fossil fuel-based feedstocks used to produce fertilizers.

India is seeking to replace all ammonia-based fertilizer imports with domestically produced green products by 2034-35. MNRE’s report said in the year 2020-21, India imported 10 million mt of urea, 5 million mt of DAP, and 3 million mt of ammonia. According to the timeline submitted by MNRE, the government would go out for bids and award contracts for the construction of new plants in the 2023-2024 period, with construction to start in 2024-2025. The government would be looking for two green urea plants and two green DAP plants.

India wants the Shipping Corp. of India to retrofit at least two ships to run on green hydrogen or derived fuels by 2027. Green ammonia bunkers and refueling facilities are to be set up at least at one port by 2025 and all major ports by 2035.

CHS to Build New S.D. Grain Shuttle Facility

News, News Briefs, Northern Plains

CHS Inc. said on Jan. 20 it will begin construction this spring on a new grain shuttle facility in southeast South Dakota, a strategic location in its Pacific Northwest corridor.

The new 1.1-million-bushel facility will be built near the intersection of Interstate 29 and State Highway 44 in southeast South Dakota and tie into an existing rail loop currently used for CHS agronomy operations.

CHS said it will feature fast and efficient receiving and loadout capabilities to bring area farmers even more market access in the Pacific Northwest grain corridor and other important markets.

Ammonia

Ammonia, California, Eastern Cornbelt, India, Market Watch, Middle East, Northwestern Europe, Pacific N.W., Southeast Asia, Tampa, U.S. Gulf, Western Canada, Western Cornbelt

US Gulf/Tampa:

Lower European natural gas prices continue to pressure ammonia price ideas on the international market, including the Tampa price for February. January was $975/mt CFR, down $55/mt from December’s $1,030/mt CFR.

Eastern Cornbelt:

Ammonia prepay prices were steady at $1,095-$1,110/st FOB in the Eastern Cornbelt, with the low at Lima, Ohio. In the southern US, new offers out of Gulf Coast terminals were confirmed in the $875-$880/st FOB range for truck tons.

Western Cornbelt:

Spring prepay offers for ammonia were unchanged at $1,050-$1,100/st FOB in the Western Cornbelt, with the low in Nebraska and the high at Palmyra, Mo. Iowa terminals were reported in the $1,060-$1,070/st FOB range.

California:

Anhydrous ammonia postings in California remained at $1,250/st DEL. The aqua ammonia market was steady as well at $326-$336/st FOB, with the low at Stockton and the high at Sycamore.

Pacific Northwest:

New offers for ammonia were reported at $970-$1,000/st DEL and $950-$980/st FOB Washington terminals, with aqua ammonia pricing unchanged at $275/st FOB in the Pacific Northwest.

Western Canada:

Spring pricing for anhydrous ammonia in Western Canada was pegged in a broad C$1,475-$1,640/mt DEL range for April-June, depending on location and supplier.

Northwest Europe:

Lower gas prices in Europe are allowing more ammonia plants to open. While sources welcomed the moves, they noted that it takes time for the plants to get to full production, leaving some gaps in supply.

The cost to produce one ton of ammonia is now estimated at $800/mt, substantially down from $1,000/mt noted just a few weeks ago. The drop in production cost is expected to have an impact on imported ammonia, which in turn should hit suppliers from Indonesia to Trinidad and Tobago.

Sources reported that Asia suppliers have already stopped offering material to European buyers because of the price. Algerian product offered at $950/mt FOB is being rejected, and sources said the European-equivalent price in the $990s/mt FOB is too high for consideration.

Also pushing against higher prices were continued reports of Turkey taking more Iranian ammonia at levels that would equate to the low-$900s/mt CFR if offered into Northwest Europe. Sources quickly added that the Turkish market is quickly becoming separate from the rest of the European market because of the Iranian connection.

The lack of any new business into Northwest Europe is causing the public price to remain at $1,050/mt CFR. However, sources expect to see that price dip into the $900s/mt CFR as the rest of the global players reduce their offered prices.

India:

Sources reported no new spot deals into India. The bulk of the ammonia entering the country is from contracts with producers mostly located in the Arab Gulf. The last bit of spot business put the price in the $850s/mt CFR.

Many of the tons India bought in the last quarter of 2022 came from China. Sources said that the softer prices now hitting the ammonia market could lead Chinese suppliers to hold back their product, leaving India with fewer alternatives to the Arab Gulf.

Middle East:

The bulk of the region’s business is being done under contracts that show prices at $800/mt FOB and lower. However, spot deals done at the end of the 2022 remain the last recorded purchases.

Producers continue to argue for $850/mt FOB, even as the market softens. Traders said that producers will eventually have to drop their spot price, as the lower cost of producing ammonia in Europe is reducing the motivation for European buyers to accept high prices from outside sources. At the same time, Iran continues to offer product at a discount to the Arab Gulf price, cutting into other markets.

Southeast Asia:

Producers are trying to hold on to prices in the mid-$700s/mt FOB, even as the European price is dropping and buyers in Asia are demanding lower levels.

In order to do a deal in Europe now, sources said the price from Indonesia or Malaysia would have to come down to $650/mt FOB or so. With this in mind, buyers in South Korea and Taiwan were said to also be looking at this price for their purchases. So far, nothing has been done at these low levels.

South Korean imports for 2022 were reported at 1.3 million mt by Trade Data Monitor, down 6% from 1.4 million mt imported in 2021. Saudi Arabia was the market’s big winner, sending 574,000 mt for the year compared to 278,000 mt in 2021, followed by Indonesia with 559,000 mt. Trinidad shipped zero tons to South Korea in 2022 after sending 134,000 mt in the prior year.

December deliveries were reported at 99,000 mt, down 17% from the year-ago 120,000 mt. Shipments from Saudi Arabia accounted for 51% of the imports at 51,000 mt, while Indonesia took up the balance with about 49,000 mt.

Fourth-quarter imports were reported at 260,000 mt, up slightly from 251,000 mt in fourth-quarter 2021. The market showed a drop in imports in the second half of the year at 588,000 mt, off from 635,000 mt.

Urea

Black Sea, Brazil, California, China, Eastern Cornbelt, Indonesia, Market Watch, Middle East, Pacific N.W., Russia, South Korea, U.S. Gulf, Urea, Western Canada, Western Cornbelt

US Gulf:

Early-week business was reported at $418/st FOB. Values softened as the week progressed, however, with prices stair-stepping down to $385/st FOB on Jan. 19.

Eastern Cornbelt:

Urea prices slipped to $460-$485/st FOB in the Eastern Cornbelt, down $15-$20/st, with both the high and low confirmed at Cincinnati during the week.

Western Cornbelt:

Urea prices continued to fall in the Western Cornbelt, with the week’s low confirmed at $400-$415/st FOB Port Neal, Iowa. The St. Louis, Mo., urea market was pegged at $430-$450/st FOB, down from last week’s $455-460/st FOB range, while pricing at St. Paul, Minn., slipped to $460-$480/st FOB, down from $500-$510/st FOB.

In the Northern Plains, delivered urea pricing in North Dakota fell to $530-$545/st for prompt tons. In the Southern Plains, sources quoted the Catoosa/Inola, Okla., urea market at $450-$475/st FOB during the week.

California:

Although reference prices for urea remained as high as $700/st FOB Stockton during the week, rail-DEL pricing was quoted as low as $585/st for March shipment in California, with sources claiming the market “seems to change by the hour.”

Pacific Northwest:

Urea pricing dropped to $575/st FOB Rivergate, Ore., and $580/st FOB Aurora, Ore., down from the previous $640-$645/st FOB range. Delivered urea was pegged at $575-$585/st in the Pacific Northwest, down from $625-$635/st DEL, with the low reported for railed tons in Washington and the high confirmed in Montana for spring offers.

Western Canada:

Urea pricing in Western Canada slipped to C$880-$900/mt DEL for January-February and down to C$840-$865/mt DEL for March-April, below the previous C$940-$970/mt DEL level reported in late December. “The markets are sloppy for certain,” commented one regional contact.

India:

The closing date of the IPL contract tender was pushed back to Feb. 1. The tender is the first of its kind to secure 600,000 mt over a one-year period through monthly shipments.

Sources speculated that the delay resulted from a number of reasons. Some said that with urea prices falling, IPL might be hoping for lower initial prices in the tender. Others commented that IPL was taking extra time to fine-tune the rules of the supply process.

One trader also noted that IPL has yet to successfully renew its permit to import urea on a spot basis. Some within the government have reportedly raised objections that IPL, as a public/private joint venture, should not be given the responsibility to import urea when two state-owned enterprises – RCF and NFL – have shown themselves capable of carrying spot imports. The contract tender could be seen, said one trader, as a way for IPL to remain in the urea import game in the hopes of getting its spot import permit renewed.

Sources said the spot tender is unlikely to be called before late February. The paperwork is reportedly prepared and is only lacking final approval by the Department of Fertilizers. The delay could be tied to the results of the IPL contract tender, some speculated. If there is enough participation in the IPL tender, sources said, the spot tender may not require as large a purchase as initially expected.

Black Sea/Russia:

Prices showed strength at a time when most urea markets were softening. Sources now estimate the price of prilled urea out of Black Sea ports to be at $420/mt FOB. However, prices have shown a wide range, representing shipping from northern eastern Russian ports to the higher priced far-eastern Georgian ports.

Reports of urea shipments out of Russian port facilities put November exports at 565,000 mt, a significant increase from 466,000 mt reported by Trade Data Monitor for November 2021.

Exports from ports located in the northeast of the Black Sea were reported at 54,000 mt, while the bulk of exports – 475,000 mt – came from Baltic Sea ports. The remaining 35,000 mt were sent by land to buyers in Poland and Romania.

Indonesia:

Rumors circulated that a selling tender could be called as early as next week. Such a move would stand in contrast to earlier signals sent from the Indonesian government that no exports would occur until late February.

Sources said that the government position on delaying exports comes from their estimate of urea reserves for the current domestic season. Producers have been pressuring the government to allow for an earlier tender using their own urea supply and demand numbers for the season.

According to international traders, some government officials appear ready to accept the figures from producers and allow for an export tender to be called. One trader noted that an export allocation of 1 million mt for 2023 has already been cleared, and all that is needed is a final decision from a government official. He noted that the government might be conservative about its calculations about supply and demand because, as this is an election year, it would not do well for the ruling party should urea supplies fall short of demand.

No one is speculating about what prices might be in the tender, once it is called, and no new sales have occurred out of Indonesia since the mid-fourth quarter. However, a sale this week by Petronas in Malaysia provided a glimpse into current pricing ideas.

Petronas reportedly sold 10,000 mt of granular urea at $435-$440/mt FOB. The standard difference between Malaysia and Indonesia would put the Indonesia price at $425-$430/mt FOB. Sources had said anything in the low-$400s/mt FOB would still provide a healthy return to Indonesian producers.

Middle East:

Reports are circulating that Keytrade was involved in an 80,000 mt deal out of Oman priced in the low-$430s/mt FOB. The product was previously expected to ship in late January, but now seems destined to load in late February or early March.

Sources said that the price would fit with discussions about Arab Gulf prices for January, but are too high for February levels. Even in the $430s/mt FOB, sources considered the price too high for the current global market. With India holding off on its spot tender, and markets in Mexico, Brazil, and the US remaining soft, the reported price seemed difficult to justify.

Egyptian producers have gone quiet following rumors that discussions are now focusing on $450/mt FOB. The price would be a significant drop from the $495-$510/mt FOB achieved in late 2022 for January shipment. Sources dismissed the higher prices as traders needing to cover some smaller deals rather than indicative of any forward pricing arrangements.

China:

Pricing discussions were said to be at $430/mt FOB from producers and $420/mt FOB from buyers, but with no deals struck. Traders figure that some deals can be made because reports are showing urea reserves to be larger than anticipated, leaving more room for exports.

New deals, however, will have to wait at least a couple of weeks. The Lunar New Year begins on Jan. 22, and most offices were expected to close as early as Friday in celebration. Sources said that most firms will run on reduced staffing, as the holiday period is likely to stretch out until the end of the month. One trader said the holiday will be the first major opportunity for the Chinese people to travel following years of tight COVID-related restrictions on commerce and movement.

Brazil:

Limited interest by buyers and sellers has narrowed the landed price of urea to $450-$455/mt CFR. Sources are also reporting that Iranian material is being shopped around at $430/mt CFR for delivery in January, and $420/mt CFR for February.

Prices have also narrowed in Rondonopolis to $620-$640/mt FOB ex-warehouse. Sources noted little interest in prompt deliveries, as the focus seemed to be more on demand for the 2024 safrinha season.

South Korea:

Trade Data Monitor reported 2022 urea imports at 879,000 mt, close to the 877,000 mt imported during 2021. China was the market’s largest supplier with 378,000 mt, followed by Qatar with 210,000 mt.

December arrivals were reported at 67,000 mt, down 23% from 87,000 mt in December 2021. China supplied 57% of the material with 38,000 mt, followed by 27,000 mt from Qatar. Fourth-quarter imports were off 28%, falling to 125,000 mt from the prior-year 174,000 mt. Second-half imports were 318,00 mt, compared to 388,000 through the last six months of 2021.

Ammonium Sulfate

Ammonium Sulfate, Brazil, California, China, Eastern Cornbelt, Indonesia, Market Watch, Pacific N.W., South Korea, U.S. Gulf, Western Canada, Western Cornbelt

US Gulf:

NOLA barge price ideas continued at $335-$345/st FOB.

Eastern Cornbelt:

Granular ammonium sulfate pricing was quoted at $400-$450/st FOB in the Eastern Cornbelt, depending on location.

Western Cornbelt:

Granular ammonium sulfate pricing remained at $395-$425/st FOB in the Western Cornbelt, with the low confirmed at St. Louis.

California:

The ammonium sulfate market was steady at $500-$525/st FOB in California, depending on grade and location, with the high confirmed at Lathrop, Woodland, and Richvale. Rail-DEL pricing for granular tons in Northern California was pegged at the $460/st level.

Pacific Northwest:

The ammonium sulfate market remained at $430-$470/st FOB and $430-$475/st DEL in the Pacific Northwest, depending on grade, location, and supplier, with the low confirmed for standard and the high for granular product.

Western Canada:

Ammonium sulfate pricing in Western Canada was quoted at C$600-$635/mt DEL for January-February. “Shipping remains brisk on existing contracts,” said one source. “Some customers are starting to run out of ammonium sulfate for farm blends but keep thinking there might be some more softening based on the volatility of urea and softening of MAP. So they are only buying small lots to keep blending.”

China:

Sources put the current market at $165-$170/mt FOB, based on a recent sale to Indonesia. The price also reflected regular fluctuations seen in the market during the past few weeks. Traders said they expect to see even softer prices in the near future.

Indonesia:

Pupuk closed a tender for 40,000 mt of caprolactam-grade ammonium sulfate at a reported $180/mt CFR. Sources said the amsul will be used in NPK production.

The tender called for one lot of 20,000 mt to be delivered by early February, with the second lot delivered any time before April 1.

Brazil:

Minor shifts in the market widened the landed price to $240-$250/mt CFR. Reports circulated that supplies might be falling off as cutbacks occur in Chinese production. Initial reports of reduced Chinese output have come on the heels of a growing number of COVID cases reported in China. International sources later said that some of the reduction may stem from cutbacks related to reduced industrial output, as the country’s workforce takes time to celebrate the Lunar New Year.

Interest in amsul is waning at Rondonopolis, as more blenders look to urea instead of ammonium sulfate for their nitrogen content. The price was pegged at $390-$400/mt FOB ex-warehouse.

South Korea:

Exports of ammonium sulfate softened to 234,000 mt in 2022, according to Trade Data Monitor,a 61% drop from 603,000 mt in 2021. The primary buyers were the US with 86,000 mt, Mexico with 83,000 mt, and New Zealand with 41,000 mt.

December exports were counted at 163 mt, down dramatically from 99,000 mt recorded in December 2021. Fourth-quarter 2022 exports also showed a strong drop, falling to 43,000 mt from the year-ago 149,000 mt. Second-semester exports stood at 108,000 mt, below 283,000 mt shipped in July-December 2021.

DAP/MAP

Brazil, California, Central Florida, China, DAP/MAP, Eastern Cornbelt, India, Market Watch, U.S. Exports, U.S. Gulf, Western Canada, Western Cornbelt

Central Florida:

Posted prices on DAP trucks loading from Central Florida continued at $650/st FOB, steady from the prior report. Truck-loaded MAP was also called $650/st FOB, unchanged from one week earlier.

North Florida-loading MAP truck postings softened to $650/st FOB for the week, down from $700/st FOB.

US Gulf:

Sources noted firming values on the DAP barge market, while MAP pricing battled for direction.

NOLA DAP barges were noted starting out the Jan. 13-19 trading week at a $628/st FOB low for tons loading in January and February, a rise from the week-ago $620/st FOB bottom, while offers from domestic producers were clocked at $635/st FOB. Prices quickly firmed, however, with players confirming trades up to $648-$650/st FOB by the end of the week. Producer offers on Jan. 19 were quoted at $645/st FOB, while DAP trades rumored at $625/st FOB went unconfirmed.

Players confirmed NOLA MAP business as high as $618/st FOB, increasing from the prior-week $610/st FOB top. Imported tons were seen trading at a $595/st FOB floor, a $10/st week-over-week slide from $605/st FOB.

Players attributed the DAP market’s ongoing firmness to limited supply. “DAP is currently very tight in the market,” said one trader. “Of the imports coming in, 75% is MAP, and (domestic producers are) tight as well.”

NOLA DAP barges loading in January and February firmed to a $628-$650/st FOB range for the week, up from $620-$625/st FOB in the prior report. MAP barges shifted to $595-$618/st FOB, a change from the week-ago $605-$610/st FOB.

US Exports:

Last-reported US Gulf spot export pricing continued at $650/mt FOB, steady from the prior report. Recent spot business included a 5,000 mt MAP cargo sold into a single destination in northern Latin America, with shipping scheduled for late January.

Eastern Cornbelt:

DAP prices were quoted at $685-$695/st FOB in the Eastern Cornbelt, with the Cincinnati market pegged at the $690/st FOB level, up $5-$10/st from last week. MAP pricing remained at $675-$685/st FOB in the region, with the low at Cincinnati.

In the Southeast, Nutrien lowered its MAP posting to $650/st FOB Aurora, N.C., and White Springs, Fla., reflecting a $50/st drop.

Western Cornbelt:

DAP pricing edged up to $685-$695/st FOB in the Western Cornbelt, with the high in Iowa. The St. Louis market DAP market was quoted at $685-$690/st FOB, reflecting a $15/st increase from last week. MAP remained at $670-$680/st FOB in the region.

In the Northern Plains, the latest DAP offers at St. Paul were pegged in the $705-$715/st FOB range, up from recent lows at the $690/st FOB level.

California:

MAP postings in California remained at $835/st FOB or DEL, though sources reported spot rail-DEL offers for as low as $790/st at mid-month.

Pacific Northwest:

MAP pricing in the Pacific Northwest slipped to $770-$780/st FOB or DEL, depending on location, down from $815-$825/st at last report.

Western Canada:

MAP pricing in Western Canada reportedly dropped to C$1,110-$1,130/mt FOB for January-February, down from the C$1,135-$1,180/mt FOB range confirmed for earlier December-January offers. Rail-DEL offers were reported at nearly the same level as the FOB market.

China:   

There were reports of a prompt DAP sale to Indonesia at $680/mt CFR, for an estimated netback in the low-$660s/mt FOB. Even with the reported deal, most international traders reported having a hard time getting offers from producers, whose main focus seems to remain on doing business directly with large-scale buyers.

India:     

NFL called a DAP tender set to close on Feb. 1. The tender is for 100,000 mt, with the tonnage to be divided into two lots – one delivered to the East Coast, and one to the West Coast. The shipping deadline is March 15.

The tender marks the first spot deal for an Indian buyer separate from the direct, quiet talks that major buyers have had with Chinese producers. In the past, tenders such these have been used to test the market to set prices for future contract talks.

Brazil:   

Prices for MAP fluctuated mildly, with the landed price coming in at $650-$670/mt CFR. Sources said the slight rise in price came as Chinese suppliers began asking for higher prices.

Rondonopolis reported softer MAP prices at $755-$800/mt FOB ex-warehouse. Farmers are reportedly holding off on the last of their 2023/2024 orders in the hope that they will be able to secure lower prices closer to when they will actually need the tons.