IPL closed its tender Dec. 8 with about 1.5 million mt offered. The lowest price was $404.45/mt CFR for 100,000 mt from Transglobe. Other offers were in the same neighborhood. An additional 550,000 mt were offered in the $406-$409/mt CFR range.
Sources reported over the weekend that IPL will make its counter-bid to the rest of the companies offering tons early this week. The most likely scenario is that IPL will start with the Transglobe price and then offer small adjustments based on the port of discharge.
The average price in this tender came in at $414/10/mt CFR as compared to the $416/mt CFR average for all the offers in the MMTC tender outside the Swiss Singapore offer of $389.50/mt CFR.
The Swiss Singapore offer left MMTC with the ability to issue an award for only 50,000 mt. The results of the IPL tender could lead to a much larger purchase that gets India closer to fulfilling its urea needs for the current year.
India still needs about 1 million mt to close out the year. If IPL can get several of the offering companies to accept the Transglobe number of $404.45/mt CFR, it will be close to meeting the country’s needs. If IPL does not take 800,000-1 million mt in this round, sources expect to see another tender called soon.