All posts by mickeybarb@charter.net

U.K. Investor Group Seeks Government Loan to Help Restart CF’s Ince Plant

Carbon Dioxide, News, News Briefs, Nitrogen Solutions, NPK, United Kingdom

The U.K. government has turned down a request for a loan of up to £10 million (approximately $11.9 million at current exchange rates) from a group of investors seeking to restart production at CF Fertilisers UK Ltd.’s mothballed Ince manufacturing plant, according to U.K. media reports.

Operations at the Ince plant near Chester, Northwest England, have been halted since September last year due to high natural gas prices. Early last month, CF Fertilisers announced proposals to permanently close the facility as part of a proposed restructuring of its operations in the U.K. (GM June 10, p. 1).

The consortium of investors, working under the banner of UK Nitrogen and backed by former head of the British army Lord Richard Dannatt, is in talks with CF Industries Holding Inc., Deerfield, Ill., CF Fertilisers’ parent company, to buy the Ince plant, according to a report by the U.K.’s Financial Times newspaper.

According to the report, UK Nitrogen is made up of fertilizer companies, private equity groups, and “high-net-worth” individuals.

UK Nitrogen insisted that it is not asking for any tax payer money, but rather just seeking help to restart the plant, according to the report.

Supporters of the proposed deal argue that a permanent shutdown of the Ince facility would reduce fertilizers supplies for the country’s farmers, further weakening the U.K.’s food industry, as well as posing a risk to future supplies of CO2 in the U.K.

CF’s Ince plant has the capacity to produce ammonia, nitric acid, ammonium nitrate (AN), and NS and NPKs. Ince and CF’s other U.K. fertilizer manufacturing plant at Billingham, in Teeside, Northeast England, together have the combined capability to produce an estimated 60% of the U.K.’s CO2.

As part of its proposed restructuring of its operations in the U.K., CF Fertiliser proposes to focus its U.K. manufacturing operations exclusively at the Billingham manufacturing site, where it produces ammonia, nitric acid, AN, and CO2 as a byproduct of the ammonia production process.

The company believes that only one manufacturing facility is needed to fulfil U.K. AN demand it has been serving. Its Billingham plant has 0.58 million mt/y AN production capacity, according to Green Markets’ “Nitrogen Quarterly Model,” and is the largest ammonia, AN, and CO2production facility in the U.K. CF’s Ince plant has 0.5 million mt/y of AN production capacity.

CF Fertilisers has also said the NS and NPK products manufactured at the Ince plant historically have made “a minimum contribution to gross margin,” and it does not expect this situation to improve due to the significant increase in the price of raw materials.

CF Fertilisers said the closure of the Ince plant near Ellesmere Port could result in up to 283 redundancies.

The decision to provide the loan or not rests with the U.K.’s Department for Business, Energy, and Industrial Strategy, which has so far “firmly rejected” the bid for a loan. The report cited a government spokesperson as saying the government believes this is an issue for the market to solve.

Ellesmere Port and Neston MP Justin Madders and Secretary of State George Eustice said late last month in the U.K. Parliament that the plant could be profitable if reopened, according to a report by Cheshire Live.

Madders noted in Parliament that CF Industries increased its quarterly dividends by 33% in the first quarter of this year (GM May 6, p. 1).

CF Industries, as cited by the report, confirmed it has spoken with several parties.

CF Fertilisers’ proposed restructure follows a strategic review of the company’s U.K. business, which confirmed additional challenges facing the business, and – CF said – is proposed in order to secure long-term profitability and sustainability and to enable the company to continue to supply fertilizer, CO2, and other industrial products to its U.K. customers.

The company halted operations its Billingham manufacturing facility – as well as at Ince – last September due to high natural gas prices that made production at the sites unprofitable (GM Sept. 17, 2021).

The stoppage sparked a shortage of CO2, which threatened to cause food shortages and price rises nationwide in the U.K. A week later, U.K. ministers bailed out CF, providing money to fund the restart of the Billingham plant for three weeks of production, while the Ince plant remained shut (GM Sept. 24, 2021).

Since then, CF has kept the Billingham plant operating, despite further escalations in natural gas prices.

The Billingham complex is capable of producing 750 mt of CO2 per day for commercial use and last October, CF – with U.K. government participation – had reached CO2pricing and offtake agreements with its industrial gas customers in the U.K (GM Oct. 15, 2021). That agreement ran until Jan. 31, 2022, and in early February, CF secured a new offtake and pricing agreement with the U.K.’s carbon dioxide industry (GM Feb. 4, p. 28; Jan. 28, p. 20).

Yara to Sell Stake in Ethiopian SOP Project

Africa, India, News, News Briefs, Specialty, Sulfate of Potash

Yara International ASA, Oslo, has signed a Share Purchase Agreement with Indian firm XLR Enterprises Ltd. to sell its ownership interest in the Dallol mining project in Ethiopia.

XLR Enterprises is a partner in the project, which comprises a planned sulfate of potash (SOP) mine in the Afar region in Ethiopia. Yara has been the majority shareholder in the development, with Liberty Metals and Mining Holdings LLC as a second partner.

Yara was last reported to have a 51.8% stake in the Dallol project, with XLR Enterprises holding a 23.2% interest and Liberty Metals and Mining Holdings a 25% interest (GM Nov. 10, 2017).

In a July 4 statement announcing the agreement, Yara said full legal ownership interest in Yara Dallol BV, together with all economic rights and all obligations and liabilities attaching or relating thereto, will be transferred to XLR Enterprises at closing. The transaction remains conditional on obtaining necessary local regulatory approvals and customary closing conditions.

As Yara recognized an impairment loss of $232 million in the fourth quarter of 2021 related to the Dallol potash mining project (GM Feb. 11, p. 27), the company said the impact on its second-quarter results is “immaterial” following the transaction.

Yara had said in its fourth-quarter and full-year 2021 earnings report that the recoverable value of the project is considered lower than its carrying value, and “with significant capital expenditures remaining, the project is exposed to ‘significant’ uncertainties.”

Dallol has been on hold since 2019 while working on structural solutions for the next stage of development of the project, prior to any potential build decision. Yara said at the time the aim was to “minimize any further capex” for Yara relating to the project (GM Feb. 14, 2020).

The Norwegian major had been looking at a potential production capacity of approximately 600,000 mt/y of SOP utilizing solution mining.

In response to the surprise of some analysts at a company earnings call on Feb. 8 about the impairment on the Dallol potash project, given the global potash commodity price trajectory, Yara International President and CEO Svein Tore Holsether said it was not about the global potash market, but more specifically about that the project and the location, with the situation in Ethiopia “highly uncertain.” In addition to war, other issues include geology and a railway to the port that never got built, he had said.

The Norwegian major said this week the divestment of the Ethiopian potash project supports Yara’s transformation by reallocating capital and risk appetite towards its strategic focus areas.

Morocco Sees Phosphate and Derivatives Sales Boost

Morocco, News, News Briefs, Phosphate

Morocco’s phosphate and derivatives sales reached over MAD47.62 billion (approximately $4.70 billion at current exchange rates) at the end of May, according to a Morocco World News report, citing new data from the country’s Foreign Exchange Office.

The report indicated that sales doubled compared with same year-ago period, when they amounted to MAD24.27 billion.

The Foreign Exchange Office attributed the Ukraine-Russia conflict as having played “a significant role” in the increase, as it presented “a prime opportunity” for Morocco’s phosphate market to fill the void left by a reduction in Russian phosphate exports.

Europe Revives Syrian Phosphate Imports

Europe, News, News Briefs, Phosphate

European countries have recently resumed imports of phosphate from Syria, benefiting a Russian company and the sanctions-hit Damascus regime, according to a report by a consortium of investigative journalists led by The Netherlands-based Lighthouse Reports and the Organized Crime and Corruption Reporting Project.

The importers include four European Union (E.U.) Member States – Italy, Bulgaria, Spain, and Poland – as well as Serbia and Ukraine, according to the report “A ‘Bloody’ Trade: Inside the Murky Supply Chain Bringing Syrian Phosphates Into Europe,” published on June 30.

Despite the risks of sanctions violations, the six countries have imported over $80 million worth of Syrian phosphates between them since 2019, according to the new investigation.

Citing E.U. and U.N. Trade data, it found Italy resumed importing in 2020 and Bulgaria in 2021, while Spain and Poland started importing Syrian phosphates earlier this year.

Greece stopped importing Syrian phosphates after 2018.

Total Phosphate Imports from Syria 2016-Mid-2022

Importing country Mt
Serbia 1,166,439
Ukraine 579,046
Greece 64,018
Italy 31,054
Bulgaria 25,611
Spain 6,500
Poland 220

Source: “A ‘Bloody’ Trade: Inside the Murky Supply Chain Bringing Syrian Phosphates Into Europe,” citing U.N. Comtrade data

According to the report, Ukraine’s imports of Syrian phosphates increased from $3-million worth in 2018 to $15-million worth last year, citing U.N. Comtrade data, and are taking place despite Ukrainian sanctions on Russian energy major Stroytransgaz and its owner. Ukraine’s imports of Syrian phosphates halted after the Russian invasion in February.

The phosphate export deals are managed by companies linked to Stroytransgaz, which has controlled Syria’s Tartous port and Syrian state-run fertilizer plants since 2019, as well as having the right to extract and sell phosphates for a period of 50 years from two key Syrian phosphate mines (GM Dec. 20, 2019).

Serbia, Europe’s top buyer of Syrian phosphates in recent years, imported $26.9 million worth of Syrian goods in 2021, the investigation found, citing an unnamed Serbian business registry. However, the products imported were not specified.

Neither the E.U. nor the U.S. specifically prohibit the purchase of Syrian phosphates, but the U.S. has imposed sanctions on both the Syrian government and Stroytransgaz. The E.U. has sanctioned Stroytransgaz’s owner, Russian billionaire – and a reported close associate of Russian President Vladimir Putin – Gennady Timchenko, as well as another reported major player in the trade, Syrian Oil and Minerals Minister Bassam Toumeh.

Unnamed experts cited by the report said companies still run the risk of violating sanctions even if the phosphates trade is technically legal.

Asked about the imports, the European Commission told the investigation it was up to individual countries to decide whether Syrian phosphate imports break sanctions. Authorities in Bulgaria, Ukraine, and Serbia confirmed to the investigation that they regard the trade as legal. But the investigation did not receive a response from the Italian authorities regarding the trade, according to the report.

But according to a Syrian economist, Karam Shaar, cited in the report, the trade shows how easily sanctions can be circumvented by “opaque supply channels and channeling of funds and goods through unknown subsidiaries of targeted companies.” He is of the view that exporting phosphates to Europe is a violation of sanctions.

The investigation found that after leaving the mines, most Syrian phosphates make their way to Syria’s Mediterranean port of Tartous, with the majority of the E.U. imports entering the bloc through Romania. Most of the shipments are handled by two Middle Eastern companies and are in Lebanese ownership, according to the report. The investigation found ships transporting Syrian phosphates to Europe showed a pattern of switching off their tracking systems while heading towards Syria and re-appearing when on route to Europe.

Syria’s phosphate industry collapsed when Islamic State militants seized the country’s largest mines in 2015. Production revived after Syrian forces recaptured them a year later, attracting buyers even from countries that opposed Bashir al-Assad’s regime.

Australia’s NeuRizer and Daelim Ink Urea Deal

Australia, News, News Briefs, South Korea, Urea

Australia’s NeuRizer Ltd. (formerly Leigh Creek Energy), Adelaide, has signed a binding, long-term agreement with its long-term strategic partner and shareholder, South Korea’s Daelim Co. Ltd., for the take or pay of 500,000 mt/y of granular urea from its proposed urea project at Leigh Creek, located some 550 kilometers north of Adelaide.

The so-named NeuRizer Urea Project (NRUP) is planned to have an initial capacity of 1 million mt/y, utilizing in-situ gasification (ISG).

The agreement with DL Trading, a 100% subsidiary of Daelim, is for an initial five years with an option to extend by mutual agreement, and is entirely for the export market.

DL Trading will purchase the urea at an agreed pricing mechanism based on index-linked pricing, putting the contract value at a potential A$1.5 billion (approximately US$1.02 billion at current exchange rates) based on forecast prices, NeuRizer said in its July 4 statement announcing the deal.

Two of the conditions precedent to the agreement is that NeuRizer has secured all necessary infrastructure and facilities to enable the shipment of at least 84,000 mt of urea per month, and a final investment decision by NeuRizer to proceed with NRUP.

The two parties inked a Heads of Agreement for the offtake in November last year.

NeuRizer Managing Director Phil Staveley said the signing of the binding take or pay agreement with DL Trading with the guarantee to take up to 50% of NRUP’s initial yearly production allows both NeuRizer and Daelim to move confidently towards project construction.

“A further 50% of uncontracted urea supply allows us to remain agile to support domestic demand and take advantage of market pricing,” he said.

The binding take or pay offtake agreement comes shortly after NeuRizer announced a deal for a private share placement to DL E&C Co. Ltd., whereby DL E&C in June took a 9.1% stake in the Australian company. DL E&C Co., also a Daelim company, is NeuRizer’s construction partner.

DL E&C was appointed the urea project’s EPCC partner in June 2021 (GM July 2, 2021).

Ammonia

Ammonia, Black Sea, Brazil, California, Eastern Cornbelt, India, Market Watch, Middle East, Northwestern Europe, Pacific N.W., Southeast Asia, Texas, Transportation, U.S. Gulf, Western Canada, Western Cornbelt

U.S. Gulf/Tampa:

Tampa ammonia for July settled at $960/mt CFR, down $40/mt from June’s $1,000/mt. With European natural gas prices spiking, however, it may be too early to forecast the Tampa price for August.

Eastern Cornbelt:

Ammonia fill offers in the Eastern Cornbelt were confirmed at $950/st FOB terminals in Illinois, Indiana, and Ohio for 3Q delivery, with sources describing the order book as still open at all locations at midweek.

Western Cornbelt:

Ammonia fill offers in the Western Cornbelt were on the table at $825/st FOB Hoag, Neb., and Port Neal, Iowa, with the Palmyra, Mo., market pegged at the $950/st FOB level.

New fill offers in the Northern Plains were quoted at $900/st FOB Velva, N.D., but sources continued to report lower levels based on netbacks as producers compete for delivered fill business.

California:

Anhydrous ammonia postings from Calamco remained at $1,147/st DEL in California, with aqua ammonia posted at $301/st FOB Stockton.

Pacific Northwest:

Ammonia fill offers were announced late in the week at $910/st FOB Ritzville, Wash., $930/st rail-DEL, and $950/st truck-DEL in the Pacific Northwest, down dramatically from mid-June prompt pricing at $1,475/st FOB and $1,500/st DEL. Sources also confirmed some pre-fill offers at $1,250/st FOB and $1,130/st rail-DEL on a spot basis.

Aqua ammonia pricing was pegged at $240/st FOB in the region, reflecting a sharp drop from the mid-June level of $370/st FOB for prompt tons.

Western Canada:

Sources said ammonia fill programs were out in Western Canada, with uptake described as strong. Fill pricing was quoted at C$1,320-$1,340/mt DEL in the region for fall tons, down dramatically from the last prompt spring business at C$2,230-$2,250/mt DEL.

Northwest Europe:

Even with higher natural gas prices and plans for gas rationing, sources said the ammonia price in Northwest Europe appears to have softened. Estimates of where the price should be were put at $1,050-$1,100/mt C&F.

Sources noted a distinct lack of spot business in the region, but enough sales from other sources that normally feed into the area to produce the estimated price range. A reported sale of 10,000 mt from Algeria was reported at $1,000/mt FOB. The tonnage is apparently destined for Turkey.

In addition, Mitsui reportedly picked up a cargo of 15,000 mt from Indonesia that is expected to be sent to Spain and Portugal. While neither of the deals were for Northwest Europe, sources said the prices were public enough to calculate a Northwest Europe equivalent price.

Europe remains a high-priced bubble in the global ammonia market, largely because of the high price of natural gas. As a result, lower priced product from the rest of the world is finding its way there. The result is a steady price in Europe.

Some softening might even be expected, said one trader, because supplies in Southeast Asia and the Arab Gulf appear to be leaning to a slight surplus.

Black Sea:

Sources continue to report that the war in Ukraine is keeping any Russian ammonia from being exported. The pipeline that feeds Yuzhnyy has been shut since the war started. In addition, blockades of the Ukrainian ports by the Russian navy are preventing any exports.

Sources noted that unlike dry bulk goods such as urea and DAP, ammonia cannot be diverted to alternative ports for vessel loadings. The lack of sales from the area prevents any price checking.

Middle East:

Arab Gulf producers are continuing to hold to their price ideas of $900-$950/mt FOB. This is only a slight variation of previous expectations that topped out at $970/mt FOB.

The only material flowing from the Arab Gulf appears to be contract tons. With Ma’aden III up and running and a new plant in Oman gearing up, sources said a surplus of material is expected soon.

Pricing for now depends on the destination. If tons are heading to Europe, sources said the Western European market could absorb the price set by the producers. However, if the tonnage is going to Southeast Asia, the netback needs to be closer to $700/mt FOB.

While sales to Europe will be welcome, sources said buyers in Southeast Asia are currently asking suppliers to cut back on their shipments because of reduced demand.

Southeast Asia:

Sources said the main buyers in Southeast Asia – South Korea and Taiwan – are asking their suppliers to slow down and delay upcoming shipments. Traders noted that the global economic slowdown from higher interest rates and higher inflation has caused some companies to cut back on their production.

Ammonia from producers in the area is finding buyers in other parts of the world. Reportedly, Mitsui booked 15,000 mt for delivery to Spain and Portugal.

January-May ammonia imports in Thailand were reported at 130,000 mt by Trade Data Monitor. This is down from the 178,000 mt imported during the same period of 2021.

May 2022 imports were reported at 30,000 mt, up 20% from the 25,000 mt imported in May 2021. Malaysia dominated the imports for May with 28,000 mt, as well as the first five months of the year, with 107,000 mt.

India:

The only business reported by sources involved tons arriving under contract. The lack of any spot deals was not surprising to traders. The phosphate producers are facing higher input costs, making it more expensive to produce DAP than to import the product. As a result, only the tons under contract are coming in.

Sources estimated the price into India at $1,000-$1,100/mt CFR if a spot market existed. They based their estimate on prices from the Arab Gulf and Southeast Asia.

Brazil:

Ammonia imports for the first half of the year were reported at 239,000 mt by Trade Data Monitor. This is down about 26% from the 322,000 mt imported in the first semester of 2021. Ammonia from Trinidad dominated the market with 209,000 mt.

Second-quarter imports were reported at 133,000 mt, all from Trinidad, compared to second-quarter 2021 imports of 186,000 mt. June 2022 imports were down 52%, to 42,000 mt from June 2021 imports of 87,000 mt.

Shipping:

Sources said the increased demand for LNG vessels to haul gas to Europe does not seem to have affected vessel availability for ammonia shipments. One trader noted that the LNG demands are usually for ships much larger than the ammonia trade. For now, he said, the growing demand for LNG vessels is not impacting the availability of ships for ammonia.

The main factor currently affecting ammonia shipping is the break in the old shipping patterns with the lack of shipments from the Black Sea and Baltic ports. The vessels now have to spend more time at sea securing and delivering their ammonia cargoes. These longer distances do affect the final delivered price, sources said, but not in an egregious way.

Urea

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

U.S. Gulf:

NOLA granular urea prices edged down a bit, falling to $495-$525/st FOB compared to the week-ago $505-$530/st FOB.

Eastern Cornbelt:

Urea pricing was reported at $550-$570/st FOB in the Eastern Cornbelt, depending on location, with the Cincinnati, Ohio, market pegged at the $565/st FOB level at midweek.

Western Cornbelt:

Urea prices were quoted at $535-$560/st FOB in the Western Cornbelt, down from the prior week’s $550-$570/st FOB range, with the low confirmed at St. Louis, Mo. The Catoosa/Inola, Okla., and St. Paul, Minn., urea markets both fell in the $545-$555/st FOB range during the week.

California:

Urea pricing in California was quoted at $710-$760/st FOB port terminals for bulk tons, although reference prices remained as high as $900/st FOB Stockton for bagged product. Rail-DEL urea sales in California were reported as low as $625/st for limited spot sales in early July.

Pacific Northwest:

The urea market was pegged at $595-$600/st FOB in the Pacific Northwest, down roughly $20/st from last report, with the low at Rivergate, Ore. Rail-DEL pricing fell in the $610-$625/st range in the region in early July.

Western Canada:

Urea pricing in Western Canada was confirmed at C$885-$890/mt FOB for July-September tons, up from the initial June fill pricing offers at C$785-$825/mt FOB. Delivered urea fell in the C$850-$870/mt range for August-September shipments, up from C$785-$820/mt in mid-June.

India:

The industry is still waiting for word of the next urea tender. Sources said the call might now happen in the second week of July. To keep up with demand, sources said awards from the tender will have to bring in at least 1.5 million mt.

Sources said traders are beginning to line up tons from major suppliers in anticipation of the tender. The latest notice from China about further restrictions on urea exports has forced traders to look to the Arab Gulf, North Africa, and Indonesia for cargoes.

A tender called by RCF will close on July 25. The tender appears to be connected to the three-year deal signed with OMIFCO for shipments of 1 million mt during each year of the agreement. The tender calls for the winner to ship at least two cargoes of 40,000 mt each month through January 2025, with one going to an East Coast port and the other to a West Coast port.

The government began singing the praises of “nano urea” as a way of reducing India’s dependence on urea imports. In statements released this week, government officials said once the eight nano urea plants are up and running in 2025, India will have no need to import urea.

According to patent holder IIFCO, a 500 ml bottle of nano urea can provide the equivalent nutrient value of a 45-kg bag of granular urea.

China:

Earlier rumors that more urea export restrictions were coming appear to have come true. Sources said major urea producers were approached in the past several weeks and asked to stop exporting urea to the global market for the next month or two.

Even before this latest request by the government, urea exports from China were limited. Customs officials had begun to slow-walk applications for exports. At the same time, the officials were forbidding companies to engage in swaps of product – a common industry practice – if the necessary tonnage was not ready at an export warehouse in time.

The urea that has been shipped recently has either been tied to long-term contracts or to the most recent Indian tender. Prices based on the domestic market are quoted at $560/mt FOB. Sources said, however, the public basis price is still being worked off the last Indian tender at $685-$690/mt FOB.

Middle East:

Traders are said to be spending more time wooing Arab Gulf producers to secure tons for the upcoming Indian tender. Sources said reports that urea exports from China will be further restricted have forced traders to look elsewhere.

Sources said the tons moving out of the region are either long-term contracts or cargoes related to the previous Indian tender. Prices being quoted under the former are now reported at $580/mt FOB, with some business reportedly done at $620/mt FOB. The price based on the Indian tender remains at $685-$690/mt FOB.

Egyptian sources reported a small dip in pricing. Helwan reportedly sold 3,000 mt of granular urea to an unnamed buyer at $730/mt FOB. The price is $10/mt lower than deals worked out in the last week of June.

Indonesia:

More material was sold at a steady price. Sources reported that 70,000 mt of granular urea was sold for July shipment at $547/mt FOB. This is the same price used for cargoes booked in late June, also for July shipment.

Thailand:

January-May imports of urea were reported at 647,000 mt by Trade Data Monitor. This is down about 27% from the 888,000 mt imported during the same period in 2021.

May 2022 imports were reported at 130,000 mt, down 72% from the 467,000 mt imported in May 2021. The main suppliers were Saudi Arabia with 79,000 mt and Malaysia with 24,000 mt.

Brazil:

The landed urea price remained steady at $650-$680/mt CFR. Sources said sellers are pushing prices closer to $700/mt CFR, but buyers are being just as aggressive in pushing back. Some international traders have reported sales at $700/mt CFR, but without any details.

The Rondonópolis market showed a slightly wider spread at $780-$820/mt FOB ex-warehouse. Buyers are reportedly holding back on any additional purchases as they assess global market trends.

Imports for the first half of the calendar year were reported at 3.1 million mt by Trade Data Monitor, down about 11% from the 3.5 million mt imported during the first semester of 2021. Increased imports from Oman reflected OMIFCO making product available for the global market after years of only being able to sell to India. More material available from the new Dangote facility was also seen in the large increase in product from Nigeria.

Supplying Country Quantity (mt)
Jan-June 2022 Jan-June 2021
Oman 713,000 634,000
Nigeria 604,000 226,000
Qatar 565,000 937,000
Russia 488,000 770,000
Algeria 305,000 366,000

Second-quarter 2022 imports were reported at 1.47 million mt, just marginally down from the 1.51 million mt imported during the same period of 2021.

June 2022 imports were reported at 523,000 mt, down from the 621,000 mt imported in June 2021. Oman accounted for 49% of the June imports with 219,000 mt. Qatar supplied 83,000 mt for 16% of the import market, followed by Russia with 75,000 mt for 14% of imports.

Black Sea:

The opaque nature of urea deals out of the area make nailing down prices difficult. Sources now estimate the price of prilled urea out of Russia is at $500-$540/mt FOB.

Compared to the reported prices out of China and the Arab Gulf, this price is a bit lower than calculations would predict. However, there are reports that Russian suppliers are offering urea at below-market rates to encourage buyers to work around the U.S. and E.U. sanctions on Russia.

UAN

California, Eastern Cornbelt, Market Watch, Pacific N.W., U.S. Gulf, UAN, Western Canada, Western Cornbelt

U.S. Gulf:

NOLA UAN continued to be seen as $440-$460/st ($13.75-$14.38/unit) FOB, with the market awaiting news of fill programs.

Nutrien reported that it has posted UAN at $450/st FOB NOLA on new orders effective July 8. The company noted recent strong export demand for Europe, supported by natural gas prices that reached $60/mmbtu this week.

Nutrien clarified this is not a fill program, but said it is open to taking orders for Q3 at this level with the option to close the order book at any time.

Eastern Cornbelt:

UAN-32 prices slipped to $515-$545/st ($16.09-$17.03/unit) FOB in the Eastern Cornbelt, depending on location, with the low reported at Cincinnati. UAN-28 offers at Cincinnati were pegged at the $480/st ($17.14/unit) FOB level at midweek.

Western Cornbelt:

UAN-32 remained in a broad $460-$520/st ($14.38-$16.25/unit) FOB range in the Western Cornbelt, with the low reported at Port Neal.

California:

UAN-32 pricing in California was pegged at $660-$680/st ($20.63-$21.25/unit) FOB Stockton, down $20/st from last report, but sources reported minimal sales and demand. “We haven’t been buying, mostly getting rid of old tons,” commented one source. No delivered prices were reported in the state in early July.

Pacific Northwest:

The UAN-32 market slipped to $550-$565/st ($17.19-$17.66/unit) FOB in the Pacific Northwest, with the low confirmed at Kennewick, Wash., down significantly from the last reported range of $645-$655/st ($20.16-$20.47/unit) FOB. Delivered UAN-32 was pegged as low as $520-$550/st ($16.25-$17.19/unit) in the region, with the low for railed tons on a spot basis.

Western Canada:

The UAN-28 market in Western Canada was reported at C$535-$545/mt (C$19.11-$19.46/unit) DEL for July-September tons, down from the last prompt offers at C$590-$595/mt (C$21.07-$21.25/unit) DEL in June.

Ammonium Nitrate

Ammonium Nitrate, Brazil, Market Watch

Brazil:

The impact of the Russian ban on ammonium nitrate exports is being seen in the import numbers for Brazil. Russia has been the main supplier of ammonium nitrate to Brazil.

Imports in the first half of 2022 were reported at 168,000 mt by Trade Data Monitor, down almost 70% from the 549,000 mt imported during the first semester of 2021. Second-quarter 2022 imports were reported at 102,000 mt, down from the 313,000 mt imported during the same period in 2021.

June ammonium nitrate imports were reported at 33,500 mt, down 77% from the 148,000 mt imported in June 2021. Russian product accounted for 29,000 mt in June, with an additional 4,000 mt coming from the Netherlands.

Ammonium Sulfate

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

U.S. Gulf:

NOLA ammonium sulfate barges were reported to have traded as low as $420/st FOB, down from the week-ago $450-$465/st FOB. Reports of $410/st FOB were not confirmed at press time.

Eastern Cornbelt:

Granular ammonium sulfate prices reportedly slipped to $480-$495/st FOB on the low end in the Eastern Cornbelt in the wake of the June 30 announcement from AdvanSix that it was offering Midwest river terminal pricing at the $480/st FOB level for tons shipped on July 15 or after.

Sources confirmed new ammonium sulfate sales in the South Central region for as low as $455-$460/st FOB at midweek.

Western Cornbelt:

Granular ammonium sulfate pricing slipped to $475-$495/st FOB in the Western Cornbelt for fill tons, with reports of prompt tons still offered in the $550-$560/st FOB range.

California:

Ammonium sulfate was quoted at $670-$700/st FOB in California.

Pacific Northwest:

Ammonium sulfate pricing was quoted at $620-$670/st FOB or DEL in the Pacific Northwest, with the low for standard and the high for granular. No fill programs were out yet in the region, but some sources reported rumors of 3Q fill offers landing in the upper-$500s/st in mid-July.

Western Canada:

The Western Canada ammonium sulfate market was quoted at C$500/mt DEL for the latest fill offers, down from C$900-$925/mt DEL for the last prompt prices in June.

China:

Sources reported a continued slide in prices. Caprolactam-grade amsul exports from China are now pegged at $230-$255/mt FOB.

Sources said reduced output in China because of a general industrial slowdown is being offset by reduced demand from Southeast Asian buyers. The buyers are stepping away from the market because of a slower global economy, and are demanding fewer of the products the Asian producers turn out. In turn, they do not need as much from input suppliers.

January-May imports of ammonium sulfate by Thailand were reported at 167,000 mt by Trade Data Monitor, down about 12% from the 191,000 mt imported during the same period in 2021. China dominated the sourcing with 123,000 mt.

May 2022 imports were reported at 56,000 mt, down from the 68,000 mt imported in May 2021, with tons split almost evenly between China at 29,000 mt and Taiwan at 25,000 mt.

Brazil:

The ammonium sulfate price remained steady at $340-$370/mt CFR. The Rondonópolis price tightened to $470-$505/mt FOB ex-warehouse.

Imports for the first half of the year were reported at 2 million mt by Trade Data Monitor. This is up about 19% from the 1.7 million mt imported during the first semester of 2021. Chinese product dominated the imports with 1.8 million mt.

Second-quarter 2022 imports were reported at 713,000 mt, up from the 535,000 mt imported during the same period in 2021. June 2022 imports were pegged at 197,000 mt, down from the 332,000 mt imported in June 2021. China, as usual, dominated the market with 172,000 mt.