All posts by mickeybarb@charter.net

European Gas Prices Rally Again Amid Continued Lower Russian Shipments

Europe, Featured, Germany, News, Poland, Russia

European natural gas prices rallied again this week as Russia continued to curb deliveries to the region. Prices are rebounding following a sharp drop in the final days of 2021 (GM Dec. 31, 2021).

Russian gas volumes flowing to Europe via key pipelines have fallen to the lowest level for this time of year since at least 2015, Bloomberg reported – just as temperatures are dropping again after a warmer-than-usual holiday period.

Lower gas supplies also come amid escalating geopolitical tensions between Russia and Ukraine, and U.S. warnings of a possible invasion of Ukraine early this year. About a third of Russian gas flowing to Europe crosses Ukraine, and any disruption to these supplies could turn the current European energy crunch into a widespread crisis.

Russian gas flows to Europe via Ukraine already remain limited, according to a Bloomberg report, citing data from system operator Bratislava, Slovakia-based Eustream.

The Yamal-Europe pipeline, a major link from Russia, is also continuing to send gas from Germany to Poland, which is the reverse of the normal direction (GM Dec. 31, 2021), according to Bloomberg, citing grid operator Kassel, Germany-based Gascade. This means Western Europe will have to rely on already depleted inventories to meet demand, sending prices higher.

In the meantime, several European nuclear power plants are also offline for repairs and maintenance in France, boosting gas demand.

Benchmark European natural gas futures were up for a fourth day on Jan. 6, with the Dutch TTF February contract at €98.15 a megawatt-hour by 4:59 pm (GMT), up 7.242 percent on the day. The February contract had closed at €88.74 on Jan. 4.

European gas prices had jumped to a record high on Dec. 21 following news that Russian gas flow to Germany via a key pipeline had reversed, and had started to flow eastward. The Dutch TTF front-month (January) gas contract had surged to an all-time high of €180.27 per megawatt-hour by the trading day’s close.

However, by close of trading on Dec. 31, the Dutch TTF contract was over 60 percent down on the pre-Christmas high, at €70.34 per megawatt-hour, following news of “a flotilla” of U.S. LNG cargoes heading for Europe.

The next-month Dutch TTF natural gas contract closed at just €17.57 per megawatt-hour 12 months ago (Jan. 6, 2021).

According to RBC Europe Ltd. Associate Director Biraj Borkhataria, as cited by Bloomberg this week, turbulence in European gas markets is likely to persist.

He said global gas benchmarks have been extremely volatile of late, driven by low storage levels across multiple basins and lower LNG output from a number of key exporting regions, albeit partly offset by U.S. LNG exports.

More LNG cargoes are being diverted away from China to Europe, a move that can help ease Europe’s gas supply crunch. According to a Bloomberg report, Europe received 29 LNG cargoes in the second half of December, while another three cargoes were discharging this week and another 28 shipments are expected to arrive by mid-January.

However, Borkhataria believes that the relief may be temporary amid an awakening appetite for LNG cargoes in Asia.

According to Rystad Energy, an Oslo-based independent energy research and business intelligence company, as cited in a Bloomberg report this week, the near-term European gas market sentiment indicates limited upside. Rystad expects prices may find support in depleted European storage and continued concerns over supplies from Russia.

Oslo-based SEB Chief Commodities Analyst Bjarne Schieldrop said in a Jan. 3 note, as cited by a Bloomberg report, natural gas exports from Russia to Western Europe will likely be “significantly reduced” both through Ukraine and Belarus due to sanctions, with prices in the fourth quarter of 2021 being “a guide for what is to come in 2022.”

If Russia were to invade Ukraine, Russia’s Nord Stream 2 pipeline, which has suffered repeated delays (GM Nov. 24 & 19, 2021), would be “likely dead in the water,” said Schieldrop.

However, a fertilizer industry source, commenting to Green Markets on European gas prices and their impact on ammonia and urea production, said care needs to be taken not to use the daily natural gas price as a base for the industry.

“Typically, [ammonia and urea producers] are paying averages of price ranges over a longer period, and with the high fourth-quarter 2021 prices they are now facing potentially higher numbers in the first quarter of 2022, the same way as in the fourth quarter they did not pay the very high spot prices,” he said.

“The producers we are talking to (on ammonia) do not see a downward correction in January, but probably a further increase [due to the above pricing],” the source said, adding that what the production costs of ammonia [and urea] at the end will be for the individual plants is a bit difficult to say.

“Additionally, if the price drop is based ‘only’ on additional supply due to positive arbitrage with other market areas, it is only a matter of time until that tonnage will flow back to Brazil etc. again and leave Europe short/tighter, suggesting we may have ‘a yo-yo’ situation for some weeks and months,” he said.

The European Commission (E.C.) back in the autumn adopted a “toolbox” of measures in an attempt to mitigate the impact of the gas price rise (GM Oct. 15, 2021), including the request to the Agency for the Co-operation of Energy Regulators (ACER) and The European Securities and Markets Authority (ESMA) to report by April 2022 on anti-competitive behavior in the energy market, the functioning of the carbon market, and the enforcement of the Regulation on Wholesale Energy Market Integrity and Transparency (REMIT).

Preliminary reports in November 2021 found that there is no evidence of market manipulation and that markets function in an orderly manner, the Commission said in recent communications.

Under certain conditions, E.U. law allows Member States to aid energy-intensive users in the form of partial compensation for costs linked to Emissions Trading System (ETS), or as reductions of energy levies.

The toolbox centers on support to those most impacted by the energy price surge, by proposing immediate measures such as direct support, tax reductions, or deferral of payments, the Commission said.

In the medium term, the Commission said it will consider measures for a more effective use of gas storage and explore the joint procurement of reserve gas stocks. A new legal framework for gas and hydrogen has just been tabled.

The impact of lower availability and higher prices of conventional fertilizers on this year’s harvest is unclear at this stage, the Commission said. Farmers may respond in various ways, and the Commission said it is following this issue closely.

Lithuania Begins Government Probe on Ongoing Belarus Potash Transit

Belarus, Europe, Featured, Lithuania, News, Potash

Lithuania’s parliamentary Committees on National Security and Defense (CNSD) and on Economics is to look into the circumstances surrounding the ongoing transit of potash produced by Belarusian state-run company Belaruskali via Lithuania, despite U.S. sanctions having come into force against the producer on Dec. 8, according to a Baltic Times report this week, citing the CNSD Chairman Laurynas Kasciunas, speaking to the Baltic News Service (BNS).

According to the report, CNSD plans to hold a parliamentary control session in the second or third week of January, probably jointly with the Committee on Economics.

The key aim related to the potential suspension of potash transit is to answer “will the sanctions [on transit] be effective, will they achieve what they are intended to, or will they be circumvented, will somebody else gain from them, will there be other private companies that will continue transporting the potash, and will there be other E.U. Member States that might profit from that, and whether we will not have a situation where the Russian Federation is the winner in this case,” Kasciunas said, as cited by the report.

The imposition of sanctions can only come after those questions are answered, he said, adding that the probe likely will be followed by recommendations to individual government ministries.

Belarus rails most of its potash for export through Lithuania into the Lithuanian port of Klaipėda for onward shipment. Additional U.S. sanctions were imposed on Dec. 2 on Belarus Potash Co. (BPC), the Belarusian marketer/exporter of Belaruskali’s potash, which was not included on the initial U.S. sanctions list. They come into effect on April 1, 2022 (GM Dec. 3, 2021).

The Baltic Times report cited Lithuanian President Gitanas Nausėda as stating the crisis would be resolved by Jan. 31, and “the reputational damage to Lithuania would be eliminated.”

Two Lithuanian ministers – the Foreign Minister and the Transport Minister – had tendered their resignations following strong criticism that state-run railway Lietuvos Geležinkeliai (LTG) continued to transport Belarusian potash, despite the U.S. sanctions, but have remained in their posts. At one point in December it seemed the entire Lithuanian government was set to step down amid the furore over continued Belarusian potash transit (GM Dec. 10, 2021).

LTG earlier said it received advanced payments from Belaruskali through the end of February for the transportation of Belarus potash, and that the company lacked sufficient legal grounds to stop its transportation. The railway company’s CEO Mantas Bartuska agreed to step down in an attempt to “de-escalate” the outcry, and was set to leave after a transitional period (GM Dec. 17, 2021).

However, a Lithuanian government commission on Dec. 21 concluded that an agreement signed by LTG in 2018 to transport potash from sanctions-hit Belarus goes against national security interests (GM Dec. 31, 2021).

Lithuania’s Transport Ministry on Dec. 10 registered a proposed bill, which if passed, would allow Lithuania to prevent any transit of Belarus potash or fertilizer via its territory (GM Dec. 17, 2021; Dec. 10, 2021). The draft bill proposes a law introducing sanctions for goods directly or indirectly imported, bought, or transferred from Belarus, BNS has reported. This would include Belarusian potash.

The government commission’s Dec. 21 ruling looks likely to ease the bill’s passage – or even prompt a direct government directive – as, according to European Council on Foreign Relations (ECFR) analyst and former diplomat Pavel Slyunkin, cited in a Deutsche Welle (DW) report late last week, Lithuanian politicians are looking for an option to terminate the transit without damage and violation of the transit contract. Slyunkin said that option could be recognition of the contract with Belaruskali as one that threatens the country’s national security.

“On Dec. 21, the government commission made such a decision, and now the government has the last word – in this case, it would be the basis for stopping transit with minimal losses,” he said.

ICL Secures Phosphate Mining Extension; Government Suspends Barir Mine Project

Israel, News, News Briefs, Phosphate

ICL Group, Tel Aviv, has secured a three-year extension of the phosphate mining concession of its subsidiary, Rotem Amfert Negev, in the Negev Desert in southern Israel until the end of 2024. The current concession expired at the end of 2021.

The Finance Committee of Israel’s Knesset approved the extension following the recommendation and request of the country’s Ministry of Energy.

The Rotem Amfert mining concession extension sets forth, among other things, requirements regarding the restoration of the mining and plants areas, ICL said in a statement, adding that it will, if needed, assume Rotem’s responsibilities in this respect and indemnify the State.

Israel’s Globes newspaper reported in December that the Finance Committee would likely approve the three-year extension of the phosphate concession after ICL made a recent payment of NIS23.6 million (approximately $7.6 million at current exchange rates) in recently-assessed back royalties (GM Dec. 10, 2021).

The extension had been on hold while the royalties were calculated (GM Sept. 3, 2021). ICL previously said the concession only has reserves for another three years, according to the Globes report.

But the Israeli government last week suspended its plans for a new phosphate mine at the Negev’s Barir field near the town of Arad and the Bedouin community of Kseifa, as well as the suspension of tree planting in the area.

According to a Haaretz newspaperreport, officially the phosphate mine plan was halted after Environmental Protection Minister Tamar Zandberg appealed the plan’s approval.

However, the report, citing unnamed government sources, said the United Arab List (UAL) party, a member of Israel’s coalition government that took power last June, had a major role in the decision to suspend the project.

In October, the Israeli High Court of Justice dismissed petitions filed by the Arad Municipality and other regional municipalities regarding the Barir mining plan and its alleged impact on public health, according to an ICL statement that month. But, according to this latest Haaretz report, the High Court of Justice ordered the State to complete an examination of the public-health implication of mining phosphates in the area before giving final approval for the project.

The mining project will be frozen until government policies on the issue are reviewed, with both economic and environmental aspects to be considered, according to the report. The review is mooted to take place within 180 days.

According to Haaretz, the possibility of canceling the mining project will also be considered.

Israeli environmental groups have long cited the toll ICL’s subsidiaries in Israel have taken on the local environment, including the alleged years-long pollution of the popular Bokek stream from Rotem Amfert’s production activities in the Negev Desert, as well as the alleged contribution of the ICL Dead Sea Works subsidiary at Sdom to the rapid and continued decline of the Dead Sea.

ICL, Israel’s Tax Authority Reach Agreement on 2015-2019 Tax Assessments

Israel, News, News Briefs

ICL Group, Tel Aviv, said it has reached an agreement with the Israeli Tax Authority (ITA) under which it will pay an amount of $105 million, plus indexation differences and interest. According to a Dec. 30 company statement, this will constitute “complete and final waiver” of all of the ITA’s claims regarding income tax obligations by the company and its material subsidiaries in Israel for the tax years 2015-2019.

ICL said the tax agreement is not expected to have material effect on the company’s financial statements.

Ostchem Dispute Reaches Supreme Court

News, News Briefs, Ukraine

Ukraine’s Antimonopoly Committee continues to defend, within the framework of cassation, the decision made on Sept. 5, 2019, on the forced break-up of the Ukrainian nitrogen assets of the Ostchem Group, which is owned by businessman Dmytro Firtash via his Group DF conglomerate (GM Sept. 6, 2019).

The case is to be again considered by the panel of judges of the country’s Supreme Court, Interfax-Ukraine reported this week, citing Head of the Antimonopoly Committee Olha Pischanska.

The cassation court of the Supreme Court has referred the case to the Grand Chamber of the Supreme Court because it saw there “an exceptional legal problem,” Pischanska explained.

However, she said the Antimonopoly Committee “is convinced of the fairness of its original decision,” since the actions of Ostchem, according to her, led to a supply shortage and an increase in nitrogen fertilizer prices in the midst of spring fieldwork, and “an indicative demonstration of the monopolist’s strength.”

The Antimonopoly Committee in 2019 found Ostchem’s Severdonestsk Azot, Azot, and RivneAzot companies, along with the group’s wholesale trading company NF Trading Ukraine LLC, abused their monopoly position in the sale of nitrogen fertilizers during 2014-2017. Ostchem includes two other companies that were not named – Nitrofert and Concern Stirol.

Ammonia

Ammonia, Black Sea, Eastern Cornbelt, India, Indonesia, Market Watch, Middle East, Northern Plains, Northwestern Europe, Tampa, U.S. Gulf, Western Cornbelt

U.S. Gulf/Tampa:

Tampa anhydrous ammonia for January closed at $1,115/mt CFR, up from December’s $990/mt CFR. Sources said international supplies have remained tight despite Yara’s late 2021 announcement that it was bringing back up its plants in Europe that had been idled by high natural gas prices.

Eastern Cornbelt:

The ammonia market remained at $1,300-$1,400/st FOB regional terminals in the Eastern Cornbelt, depending on location and time of shipment, with the low confirmed in Illinois for the last prompt offers and the high in Ohio for both prompt and spring prepay pricing.

Western Cornbelt:

Sources continued to report spring prepay ammonia offers in the $1,365-$1,395/st FOB range in the Western Cornbelt, with the lower numbers in Nebraska and the high in Iowa. A few prompt offers continued to be reported at the $1,350/st FOB level on a spot basis in the region.

Northern Plains:

Sources described the Northern Plains ammonia market as relatively quiet in early January, with prompt and/or prepay pricing pegged at $1,450/st FOB and $1,550/st DEL in North Dakota for the last reported business.

Northwest Europe:

Suppliers from the Baltic ports have fixed January prices at $1,140/mt FOB, which represents a serious jump from December 2021. The move means Northwest Europe pricing is now pegged at $1,180-1,250/mt C&F.

Prices are not expected to shift too much after reports that European gas prices have come off. One source said the lower price seems to be connected to the multitude of vessels arriving with gas from the U.S. Some of those vessels, are reportedly diverted from Brazil and other buyers because of the better netback.

Sources said once the price moves up in the places currently being denied product, the gas will flow back and leave European buyers scrambling for tons at higher prices again.

Middle East:

Arab Gulf producers remain fully booked into February, leaving no material for spot deals.

Some of the extra demand pressuring the Arab producers seems to be coming from Indian buyers who used to accept Iranian material. Sources said these buyers are facing issues with their banks about the arrangement and are now looking to other sources, thus putting pressure on the Arab producers to supply more ammonia to India.

India:

All buying has been based on long-term contracts. However, some buyers are now being forced to look for some spot tons because of problems getting financing for their Iranian purchases.Reportedly, Indian buyers are looking at offers of $1,000/mt CFR against contract prices that were closer to $800/mt CFR.

The lack of any loose material in the market makes identifying a new spot price difficult. One observer noted that deals made to replace the Iranian material might give the market its first look at a non-contract price in a long time.

Black Sea:

No new spot deals were reported out of Yuzhnyy. Sources said the formula-based deals that are flowing out of the area are now pegged at $1,100/mt FOB. A true spot deal, said one observer, would be much higher.

Indonesia:

The November 2021 export numbers were released this week by the Indonesian government. January-November exports were reported at 1.6 million mt by Trade Data Monitor, up 9 percent from the 1.5 million mt exported during the same period in 2020. The main buyers were South Korea, China, and Taiwan with a total of 1.02 million mt among the three.

November 2021 exports were reported at 98,000 mt, down 52 percent from the 204,000 mt exported in November 2020. The November 2021 exports were the lowest for the year.

Urea

Brazil, China, Eastern Canada, Eastern Cornbelt, India, Indonesia, Market Watch, Middle East, Northeast, Northern Plains, Pakistan, U.S. Gulf, Urea, Western Cornbelt

U.S. Gulf:

New granular urea prices saw a big drop in early-year trading, but then rebounded as the week progressed.

Sources said the year started with business in the $724-$730/st FOB range, down from the last 2021 business at $770-$780/st FOB. Prices eventually dropped to as low as $615/st FOB during the week before rebounding back to $690-$705/st FOB.

One explanation for the drop was that July-October urea imports were up 84.1 percent, to 1.64 million st from the year-ago 892,618 st. October imports moved up 95.5 percent, to 659,274 st from last year’s 337,302 st. There was speculation that some importers may not have had a home or storage for their product, thus the cut in prices.

On top of that was the roughly 9.5 percent drop in prices in India’s latest tender.

In the meantime, thinly-traded NOLA prills were reported to be offered around the $700/st FOB mark.

Eastern Cornbelt:

Sources reported softer urea prices in the Eastern Cornbelt in early January, fueled by a volatile NOLA barge market. “It will be interesting to see how these fertilizer markets hold up during the slow time of the year from now through January and February,” said one regional contact.

Urea pricing was quoted in a broad range at $770-$815/st FOB in the region, with the low confirmed out of spot Ohio River locations at midweek. The Cincinnati, Ohio, market was pegged at $805-$810/st FOB, although some sources speculated that lower offers were on the table as the week progressed.

Michigan sources pegged the terminal market at $845-$885/st FOB in early January, depending on location and time of shipment, with the low confirmed for prompt tons at Toledo, Ohio, and the high for Q1 offers FOB Webberville, Mich.

Western Cornbelt:

A volatile NOLA urea market contributed to a wide range of terminal pricing in the Western Cornbelt in early January. While Iowa sources continued to quote offers at the $840/st FOB level, pricing from some suppliers at St. Louis, Mo., reportedly dropped to the mid-$700s/st FOB at midweek.

Northern Plains:

Urea pricing slipped to $870-$910/st DEL in North Dakota, depending on location, down from the last reported range of $940-$990/st DEL in mid-December. The last urea prices confirmed at St. Paul, Minn., were in the low- to mid-$800s/st FOB, but sources said the wildly fluctuating NOLA barge market in early January made it difficult to establish an accurate range.

Northeast:

The urea market was quoted at $850-$895/st FOB in the Northeast, with the low at Baltimore, Md., and the high reported at Lancaster, Pa. In the Southeast, new pricing was confirmed at $830/st FOB Savannah, Ga.

Eastern Canada:

Urea pricing in Eastern Canada slipped to C$1,200-$1,235/mt FOB in early January, depending on location, down a full C$100/mt at the top end of the range.

India:

Sources began the new year talking about when the next Indian urea tender will be called. Reports circulated that the call may come as early as Jan. 15. Sources said the country still needs about 1.25 million mt for the season, with demand running strong.

Some traders, however, said the tender would most likely not be called until all the vessels for the urea awarded in the Dec. 23 IPL tender were nominated. With that limitation in mind, one trader said the earliest a tender could be called is Jan. 24.

China:

There has been discussion of a few small cargoes being released for shipment in containers for South Korea and Japan. These orders apparently are for the emission control programs in those countries. Large-scale exports are not expected any time soon.

Sources said producers have stepped up their production rate, as requested by the government in December. The increased production, said one trader, is to ensure a plentiful supply of urea as domestic demand begins in February and March.

One trader said the Feb. 1 Lunar New Year celebrations will lead to most production facilities closing as workers take advantage of the week-long celebrations. The Winter Olympics take place shortly thereafter. Sources said the Beijing leadership will want the plants to remain closed after the new year celebrations to keep the skies clear of pollution during the global event.

Production is not expected to kick back in until late February or early March. By then, said one source, the demand for natural gas to heat homes may abate, allowing more gas for industrial use. This could allow for more production into the second quarter.

The original reason for restricting exports was to build up domestic reserves and shelter Chinese farmers from the ever-rising global price of urea. The reserves and isolation from the world market have had an effect on pricing. Sources said the price for product out of the factories is now close to an export equivalent price of $450/mt FOB.

Even the price of the limited tons under discussion for South Korea and Japan is well below the current estimated global price. Sources said sellers are asking $800/mt FOB for their product, while buyers are bidding $750/mt FOB.Based on the IPL/India tender, sources said the netback to China is closer to $860-$865/mt FOB.

Pakistan:

The Pakistan government announced that it will be buying 50,000 mt from China in a government-to-government deal, with part of the order arriving in early February. Sources said the deal may be for as much as 125,000 mt.

International traders were skeptical the deal would take place when word first came out of Pakistan. The country tried late last year to purchase a total of 100,000 mt in two open tenders. In both cases, no one offered tons due to the tight nature of the market.

China has made some exceptions in its export restrictions for smaller lots. So far, however, the exemptions have been for East Asian countries that need urea for emission control systems. If the deal with Pakistan goes through, it would be the first major exemption for urea for agricultural use.

Indonesia:

The industry was pleased to hear that the 2022 export permits were issued just as the new year began, but sources said no one expects to see a major selling tender until late February or early March. The domestic demand is still strong enough that producers are focusing their attention at home.

November export numbers were released this week. Trade Data Monitor reported January-November 2021 exports at 1.97 million mt, down 9 percent from the 2.17 million mt exported during the same period in 2020. The Philippines, Australia, Vietnam, and India were the top four buyers in 2021, taking a total of 1.09 million mt.

November 2021 exports were reported at 174,000 mt, down 32.7 percent from the 259,000 mt shipped in November 2020. Mexico, China, and Argentina were the top buyers in November.

Middle East:

Arab Gulf producers claim they are sold out through January, with some reporting that they are sold out into early February as well. The resulting price from the IPL/India tender showed a drop in the netback to the Arab Gulf. Fertiglobe settled on $867.70/mt FOB with IPL, and trader offers with Arab Gulf backing showed netbacks at $864-$869/mt FOB.

Egyptian producers said the late-December sale by MOPCO at $960/mt FOB for January shipment is the basis for any discussion of future sales. However, netbacks for at least two Egyptian cargoes slated for India under the IPL tender showed netbacks in the low-$840s/mt FOB.

One producer said because the primary market for Egyptian urea is Europe, the netback from an Indian deal should not be part of the discussion. However, European buyers apparently disagree. Sources said buyers backed off from talks following the awards in the IPL tender. Sources said the Europeans are getting help from the falling prices in Brazil and the U.S.

The lack of any new business apparently prompted some producers to begin discussing lower prices.International traders said offers of $960/mt FOB for January and February shipments were lowered to $930/mt FOB and closed out the week at $860/mt FOB. As the week ended, sources said no new deals were signed.

Brazil:

Pressure from inland buyers to lower prices appears to have worked. Sources said the portside price came down a bit to $815-$840/mt CFR.

The push for lower prices came on the heels of the lower price exhibited in the Indian urea tender. At the same time, buyers in Brazil hoped their refusal to make any new bids could push down the price.

Sources said the Rondonopolis price settled at $920/mt FOB ex-warehouse, the low end of the price range just before the year-end holiday season.

Sources said buyers remain nervous, however. There is still strong demand for product, and congestion at the ports could mean delays getting product to the buyers inside the country. Reserves at local distributors are reportedly very low and in need of steady replenishment, especially with stronger demand expected later in January through March.

To add to the concern of higher prices inland, sources reported that urea and other fertilizers will no longer be exempt from an intra-state tax. Beginning this year, fertilizer will face a 1 percent intrastate transportation tax on the value of the product. That tax rate will rise each year until it hits 4 percent in 2025.

UAN

Eastern Canada, Eastern Cornbelt, Market Watch, Northeast, Northern Plains, U.S. Gulf, UAN, Western Cornbelt

U.S. Gulf:

NOLA barges continued to be called $545-$550/st ($17.03-$17.19/unit) FOB for January and February and $560/st ($17.50/unit) FOB for March. However, CF is now reported to be indicating $575-$580/st ($17.97-$18.13/unit) FOB for April-June.

Eastern Cornbelt:

The UAN-28 market was quoted at $521-$534/st ($18.61-$19.07/unit) FOB Cincinnati for prompt tons and up to $551/st ($19.68/unit) FOB for spring prepay. CF on Jan. 4 came out with new 2Q offers for UAN-32 at $610/st ($19.06/unit) FOB Cincinnati and Peru, Ill., with Albany, Ill., pricing reported at $615/st ($19.22/unit) FOB for April-June tons.

In Michigan, sources pegged the UAN-28 market at $582/st ($20.79/unit) FOB Webberville and $580/st ($20.71/unit) FOB Toledo for March-April shipment.

Western Cornbelt:

UAN-32 prices in the region were up following new April-June offers from CF on Jan. 4, which reportedly included $605/st ($18.91/unit) FOB St. Louis, $630/st ($19.69/unit) FOB Port Neal, Iowa, and $635/st ($19.84/unit) FOB Bigelow, Iowa, and Fremont, Neb. There were also reports of January-March offers in the $610-$620/st ($19.06-$19.38/unit) range FOB Port Neal.

In the Southern Plains, UAN-32 pricing FOB Verdigris, Okla., was quoted at $560/st ($17.50/unit) for January-February, $575/st ($17.97/unit) for March, and $590/st ($18.44/unit) for April-June. New pricing FOB Woodward, Okla., was quoted at $590/st ($18.44/unit) for January-February, $600/st ($18.75/unit) for March, and $610/st ($19.06/unit) for April-June.

Northern Plains:

UAN-32 pricing firmed to $610-$635/st ($19.06-$19.84/unit) FOB Minnesota terminals, depending on location and time of delivery, with the low reported at Pine Bend and the high confirmed at Winona for Q2 tons. The last UAN-28 prices confirmed in the North Dakota market remained at $540-$550/st ($19.29-$19.64/unit) FOB.

Northeast:

The UAN-32 market remained at $620/st ($19.38/unit) FOB Baltimore, with UAN-30 pricing pegged at $592-$596/st ($19.73-$19.87/unit) FOB. The UAN-32 market FOB terminals in upstate New York was steady at $685/st ($21.41/unit) in early January.

Eastern Canada:

The UAN-28 market remained at C$775-$798/mt (C$27.68-$28.50/unit) in Eastern Canada. UAN-32 pricing was unchanged as well at C$912/mt (C$28.50/unit) FOB on a spot basis in Ontario.

DAP/MAP

Brazil, Central Florida, China, DAP/MAP, Eastern Canada, Eastern Cornbelt, India, Indonesia, Market Watch, Northeast, Northern Plains, Saudi Arabia, U.S. Exports, U.S. Gulf, Western Cornbelt

Central Florida:

Central Florida DAP truck postings were steady at $785/st FOB, unmoved form one week earlier. Truck-loaded MAP was reported at parity with DAP at $785/st FOB, also unchanged from recent levels.

U.S. Gulf:

NOLA phosphate barge values drifted lower amid a quiet week of trading, players said.

Traders reported import pricing falling to a $725/st FOB low, down from recent quotes in the $730-$740/st FOB range. Tons produced domestically continued to be posted at $745/st FOB, with no sales reported for the week. Most players described prices topping out at $730-$735/st FOB, below the prior top.

MAP barge prices were also lower, with most calling sales and offers at a $750/st FOB floor. Domestic barge offerings held steady at $765/st FOB, sources said, although no transactions were reported at that level. Players typically reported the market topping out closer to $755/st FOB for the week.

With sources pointing both to uncertain spring demand and a seasonal market slowdown, DAP barges were noted softening to $725-$735/st FOB for the week, falling from the last published range of $740-$750/st FOB and the previous week’s reports of $730-$745/st FOB.

MAP barges were typically noted at $750-$755/st FOB, down from $755-$765/st FOB before the holidays.

U.S. Exports:

Sources continued to report a quiet Gulf phosphate export market, leaving the last spot business unchanged at $810/mt FOB.

Eastern Cornbelt:

DAP pricing remained at $775-$785/st FOB in the Eastern Cornbelt, with the low confirmed at Cincinnati. MAP was unchanged at $795-$815/st FOB in the region, with the low again reported at Cincinnati and the high in the Illinois market on a spot basis.

MAP pricing out of Michigan warehouses ranged from $845-$865/st FOB in early January, depending on location and time of shipment.

Western Cornbelt:

The DAP market was pegged at $765-$775/st FOB in the Western Cornbelt, down $5-$10/st from mid-December levels, with the low confirmed at St. Louis. MAP pricing slipped to $795-$805/st FOB in the region, depending on location, with the low again confirmed at St. Louis and the high in Iowa on a spot basis.

The Catoosa/Inola, Okla., market was quoted at $770-$775/st FOB for DAP and $805-$815/st FOB for MAP in early January.

Northern Plains:

DAP was pegged at $770-$775/st FOB St. Paul, down $10-$15/st from mid-December, with MAP quoted at the $800-$815/st FOB level, also reflecting a decline of $10-$15/st since last report.

Northeast:

Phosphate pricing FOB East Liverpool, Ohio, was quoted at $790/st for DAP and $815/st for MAP, down $10/st from last report. The upper end of the regional MAP market was pegged at the $850/st level FOB Lancaster in early January.

Eastern Canada:

The MAP market was pegged at C$1,160-$1,220/mt FOB in Eastern Canada, depending on location. DAP remained at C$1,180/mt FOB Montreal, unchanged from last report.

Saudi Arabia:

Recent phosphate business at Saudi Arabia was heard in the $865-$900/mt FOB range.

India:

Reports of a Jordanian sale of DAP to India at $910/mt CFR confirmed pricing levels first indicated by late-December purchases in Pakistan.The deal showed buyers are still willing to pay higher prices for DAP, but are not ready to add support to a campaign for higher prices.

More DAP purchases are expected. Sources said first-quarter talks for phos acid are showing indications there will be another price rise for the product. The higher acid price, combined with higher ammonia prices, makes buying DAP a better economic deal than producing the product at home, said one trader.

China:

Reports circulated this week that two cargoes from widely separated producers were in the works. Reportedly, the deals were worked out because regional supplies were high enough to satisfy local government officials. Also, the companies wanted to move out the tons before the Lunar New Year to avoid extra storage costs.

No details of the price or final destination were available at press time.

Plants are expected to begin shutting down at the end of January as part of the week-long Lunar New Year celebrations beginning on Feb. 1. Soon after those celebrations, many plants will remain down to avoid polluting the skies during the Winter Olympics.

Sources said even with the occasional release of tons, large-scale exports are not expected until the second half of the year. Besides concerns for the domestic market, sources said some export restrictions will come because of COVID-related regulations tied to incoming and outgoing vessels.

Indonesia:

The government is silent on the status of a DAP tender called in December. One trader speculated that the tender may eventually be scrapped because of the lack of participation by suppliers.

The Indonesian government released the November 2021 DAP import numbers this week. Trade Data Monitor reported January-November 2021 imports at 262,000 mt, down 21 percent from the 331,000 mt imported during the same period in 2020.November 2021 imports were reported at 1,000 mt, which appears to be normal for the month.

Brazil:

Demand for MAP remained steady in early January, as did pricing. Sources put the portside price at $850-$890/mt CFR.

Inland buyers showed some concern about reports that Morocco, Brazil’s main MAP supplier, is focusing more on DAP production than MAP. Sources reported Rondonopolis prices this week at $940-$1,055/mt FOB ex-warehouse.