AMMONIA
U.S. Gulf/Tampa: The ammonia markets remained relatively quiet last week, though there is contention over the next round of imports. Sellers, citing a turnaround in Black Sea pricing, believe Tampa buyers will have to pay more than the last done $295/mt DEL in the next round of trading.
Anhydrous ammonia imports were down only 1 percent for the fertilizer year ended June 30, to 8.36 million st, according to the DOC, versus the year-ago 8.43 million st. Imports in June helped narrow the gap as they were up 32 percent for the month, to 886,530 st from the year-ago 671,592 st.
Eastern Cornbelt: Anhydrous ammonia remained at $470-$475/st FOB, with the low end out of spot river locations and the upper numbers inland in northern Illinois. Forward contract ammonia for September through December was at $490-$500/st FOB regional terminals.
Western Cornbelt: The ammonia spot market continued at $455-$475/st FOB at regional terminals to the dealer, with the low reported in Nebraska. Forward contract ammonia for September through December was said to be at $475/st FOB in Nebraska, $485/st in Iowa, and $490/st FOB Palmyra, Mo.
California: Anhydrous ammonia pricing was lower than at last report at $415/st truck-DEL and $435/st rail-DEL in the state.
Pacific Northwest: Anhydrous ammonia pricing was quoted at $420/st FOB on the low end, with one supplier referencing the $440/st mark FOB Washington terminals for August. On a delivered basis, sources quoted the market at $435-$460/st in the region, depending on carrier and location.
Agrium has not reposted anhydrous ammonia since July 9, which was at $440/st rail-DEL in most of Washington, Oregon, and northern Idaho; $460/st truck-DEL in Oregon and Washington east of the Cascades, and in Idaho north of and including Idaho County; and $475/st truck-DEL in Montana and northern Wyoming. Also, Agrium’s aqua ammonia postings moved to $115/st FOB Central Ferry and Finley, Wash.
Western Canada: Anhydrous ammonia was quoted at $621-$666/mt DEL in the region, following a downward price adjustment on July 17.
Black Sea: The August lineup at Yuzhnyy is reportedly full. Sources say the facilities will ship out about 270,000 mt this month. The full shipping schedule means higher prices. When this month opened, the price was hovering in the mid-$240s/mt FOB. By the beginning of last week, $250/mt FOB was achieved – reportedly by Yara – and now buyers and sellers are looking at the mid-$250s/mt FOB. Sources say producers are now asking $260/mt FOB, and buyers are resisting. Asian sources say the price is hovering at $250/mt FOB, with buyers facing a losing game. Observers from the area peg the market at $250-$255/mt FOB late last week, with $260/mt FOB pegged to open this week.
Middle East: Sources are scrambling to figure out what happened in the FACT/India tender. It seems Sabic offered material at $262/mt CFR. Sources estimate the netback into the mid-$230s/mt FOB. Other offers from Qafco and Transammonia showed prices ranging from $250-$270/mt FOB.
The apparent reason for the unusually low Sabic price, say sources, was a growing supply of unsold ammonia in the Sabic tanks. One observer noted that Sabic and TFC/Taiwan took a little longer than expected in concluding their deal for last semester deliveries. Another possibility is that Sabic was willing to sell the two lots of 7,500 mt at low prices just to reduce its stockpile so the producer could raise its price to other buyers. Sources say this has been done in the past, and given the apparent upward tick in prices from Yuzhnyy, might be part of an effort by Sabic to get the Middle East price out of its doldrums.
Sources report that IPCC in Iran may soon be offering tons for export.
Until new tender business is nailed down, sources now put the market at $235-$250/mt FOB.
India: FACT closed a tender for two lots of 7,500 mt last week. As Green Markets went to press no award was made, but sources in Asia expect to see Sabic come out the winner with its low offer of $262/mt CFR. The first lot is to be delivered Sept. 1-5 and the second Sept. 20-26.
Offers follow:
| Company | Source | Quantity (mt) | US$/mt CFR |
| SABIC | Saudi Arabia | 2 x 7,500 | 262.00 |
| QAFCO | Qatar | 2 x 7,500 | 280.00 |
| Transammonia | Open | 7,500 | 294.00 |
| 7,500 | 290.00 |
Additional purchases by India are expected in the near future. Sources report that DAP producers are expected to pick up their ammonia buying. One source noted India is behind schedule in its annual ammonia purchases at this time and may try to make up for lost time with some strong purchases to come.
Reportedly, Fertil is shipping 22,000 mt to India for late August and early September arrivals.
Indonesia: Kaltim offered tons for sale, but got no takers. Asian sources report the supply and demand balance in the area was stable enough that buyers were looking for bargains while Kaltim was looking for some extra cash. Chances are, said one observer, Kaltim will be able to hold onto the ammonia and issue another selling tender later this month that might get some more interest.
UREA
U.S. Gulf: Granular barge prices shot up last week, with sources saying they started the week within the $305-$308/st FOB range, while late week trading was called $318-$320/st FOB for prompt cargoes. CF was reportedly now posting $325/st FOB for September business.
The price spurt was quite a change from the Southwestern Conference, which some buyers began by asking how low prices would fall. Those buyers had a short wait. Now the question may be how high will they go.
Why the uptick? Buyers, said most sources last week. They came into the market and started snapping up product. Sources explained that a few weeks ago buyers put forth the fear that ships of Chinese material were on their way to NOLA and that this would crater the market. However, the calendar is getting close to September and those ships have not arrived, with no firm assurance that they will. In fact, sources reported last week that ConAgra, which has that Chinese urea, was in the NOLA market buying barges. In the meantime, there were reports circulating that one Sabic vessel was going to be late getting to NOLA; however, indications are that the vessel, which is due in three weeks, was only off schedule by a few days.
U.S. urea imports were off 7 percent for the year ending June 30, to 6.256 million st from the prior year’s 6.741 million st. This past June was a big month for imports, however, seeing a 99 percent increase to 252,721 st, up from the year ago 127,190 st.
Eastern Cornbelt: Granular urea continued at $350-$360/st FOB regional terminals to the dealer, but prices were firming on the wholesale market.
Western Cornbelt: Granular urea was unchanged at $350-$360/st FOB, with the low out of spot river terminals and the upper numbers out of inland locations in Nebraska.
California: Granular urea was unchanged at $380-$400/st FOB and $390-$410/st DEL.
Pacific Northwest: Granular urea was $390-$400/st DEL in most of the region, and roughly $360-$365/st DEL to points in Montana. Agrium’s granular urea postings on July 9 firmed to $370-$385/st DEL in Montana and Wyoming, depending on location; $395/st FOB Washington warehouses at Glade, Kennewick, Warden, and Wilson; $400/st DEL in Washington, Idaho, Oregon, and northern Nevada from plants and/or warehouses in Alberta and Oregon; $410/st DEL in northern and central Utah; and $415/st DEL in southern Utah.
Western Canada: Granular urea pricing remained at $450-$475/mt DEL after falling from the previous $475-$500/mt.
Black Sea: With rumors of another round of Indian purchases getting stronger and Latin American buyers coming back into the market, producers are pushing for higher prices – and apparently, some traders are taking the bait. Reportedly, the new asking price is $265/mt FOB, with business already concluded in the upper $250s/mt FOB.
For now, say Asian sources, the Yuzhnyy market is being driven by traders taking long positions in anticipation of an Indian tender sometime later this month or early September.
Sources are adamant that $260/mt FOB was not achieved as last week ended. Whether it will go to the levels desired by the producers will depend on how many more tons the Brazilians are serious about taking and how soon India will come back in for tons.
For now, say sources, the market is pegged at $255-$260/mt FOB.
Middle East: Iran just bought 30,000 mt of granular at $270/mt FOB. Given that the Middle East suppliers usually add a premium of a couple of dollars to any sale to Iran, sources say the market has not moved.
Producers are claiming higher prices will be achieved soon because of growing demand from the U.S. and the potential of an Indian tender. The U.S. purchases will move the granular market, and the Indian business – if it materializes – will draw on whatever material is available.
Until a new public tender is called and the Middle East suppliers win an award, sources say the market has not moved off the price ranges previously expressed. Some have said the low end – $265-$270/mt FOB – may no longer be as readily available. Others are not so sure, and say deals can still be quietly made sub-$270/mt FOB.
The market for granular and prills remains at parity at $265-$275/mt FOB.
India: The industry continues to wait to see what IPL and MMTC will do later this month. The expectation is that another tender will be called by each of the buying houses to round off the 2007 buying season. The tender call could come soon – or not until the middle of September.
China: Sources report Chinese producers are trying to ride the crest of the Yuzhnyy market. Suppliers have stopped talking to anyone offering below $245/mt FOB bagged at the port. Buyers are still looking at Oct. 1 for cheaper tons, but producers seem intent on keeping the selling price up.
After Oct. 1, the export duty is slated to drop from 30 percent to 15 percent. Producers are hoping to hold or increase the price so that after Oct. 1 some of the money that is currently going to the government coffers will go to their accounts instead.
Bangladesh: Urea production suffered at the Ghorasal Urea Fertilizer Factory Ltd. (GUFFL), a unit of BCIC, after an ammonia compressor caught fire. The factory had to close down for an indefinite period on Aug. 12. The extent of loss could not be immediately ascertained, but local media estimated it in millions of dollars. According to officials of BCIC, the fire broke out at the ammonia power compressor. The factory has a daily production of 1,200 mt of urea.
NITROGEN SOLUTIONS
U.S. Gulf: With surging urea barge prices, sources said UAN price ideas have moved back up into the $260s/st FOB.
UAN imports saw a big increase in June – up 140 percent, to 237,184 st from the year-ago 98,819 st. Imports were down 10 percent for the year ending in June, to 2.56 million st from 2.84 million st.
Eastern Cornbelt: UAN-32 was still in very tight supply at $295-$305/st ($9.22-$9.53/unit) regional terminals to the dealer. Forward contract tons for September-December continued to be referenced in the $297.80-$312.20/st ($9.31-$9.76/unit) FOB range from a regional supplier.
Western Cornbelt: The UAN-32 market continued to be firm in the $290-$300/st ($9.06-$9.38/unit) range FOB regional river terminals, and in tight supply.
California: The UAN-32 market was firm at $300-$310/st ($9.38-$9.69/unit) FOB and $320-$330/st ($10.00-$10.31/unit) DEL in the state.
Pacific Northwest: UAN-32 was priced at $310-$325/st ($9.69-$10.16/unit) DEL in the region, and in very tight supply. Effective Aug. 1, Agrium’s UAN-32 postings moved to $315/st ($9.84/unit) DEL in Washington, Oregon, and northern Idaho, and $345/st ($10.78/unit) DEL Montana and northern Wyoming. UAN-28 postings in Montana and northern Wyoming moved to $302/st ($10.79/unit).
Western Canada: UAN-28 remained at $289-$304/mt ($10.32-$10.86/unit) DEL in the region.
AMMONIUM NITRATE
U.S. Gulf: No changes were reported on the barge market, with players calling the market $265-$268/st FOB.
Imports were off 24 percent for the year ending June 30, to 1.08 million st from the prior year 1.43 million st. June imports were also off 24 percent, to 40,225 st from 53,049 st.
Western Cornbelt: Ammonium nitrate was firm at $315-$325/st FOB based on the most recent sales.
Pacific Northwest: Ammonium nitrate was steady at $327-$335/st DEL in the region. CAN-17 remained at $222-$227/st FOB and $232/st rail-DEL.
AMMONIUM SULFATE
Eastern Cornbelt: Granular ammonium sulfate continued in a broad range at $210-$240/st FOB, but supplies were very tight and new sales limited.
Western Cornbelt: Granular ammonium sulfate remained at $210-$240/st FOB and in tight supply. Agrium issued a price list effective Sept. 22 for North Dakota, South Dakota, Minnesota, Nebraska, and Wisconsin at $225/st DEL.
California: Granular ammonium sulfate remained at $210-$230/st FOB, depending on location, with reports of tight supply.
Pacific Northwest: Granular ammonium sulfate was up about $10/st FOB at $225-$235/st DEL in the region, with supplies described as tight.
Western Canada: Granular ammonium sulfate pricing was pegged at $305-$315/mt DEL in the region, after a $10/mt increase on Aug. 7
U.S. Imports: Imports were up 16 percent for the year ending June 30, to 402,212 st from the prior year 346,956 st. June imports were up 27 percent, to 23,313 st from 18,382 st.
PHOSPHATE
Central Florida: A rumor circulating last week held that prices may be going up on Sept. 1. Specifically, a source said CF may be raising its Central Florida DAP price by $3/st FOB to $385/st FOB, which would match Mosaic’s current list price and PotashCorp’s Central Florida reference price.
Prompt sales continued at a trickle in Central Florida last week, but sales were made for the upcoming December-to-March period by both Mosaic and CF. Mosaic’s sales were made at the current $385/st FOB price. A source said he had been contacted by a Canadian buyer, who told him he had been able to purchase DAP for that period at $380/st FOB, although that report could not be confirmed. However, it was surprising that sales were made that far into the future, which was an indication of the strength of the market. Producers said inquiries for the fall season were stronger last week.
In July, 625,000 mt of DAP and MAP were sold in the North American market, according to TFI’s latest report, and sales were expected to be strong in both August and September as well. Considering the large book of business PhosChem has already placed for India and other offshore buyers and the strong world market, inventories will remain low and will be extremely low by the end of the fall season. Prices were not likely to take a tumble anytime soon.
Last week, the DAP price range remained at $382-$385/st FOB. Mosaic’s asking price was $385/st FOB for DAP and $381/st FOB for MAP. CF was listing a price of $382/st FOB for prompt DAP and MAP; however, CF rarely makes sales to the dealer level. PotashCorp’s Central Florida reference price remained at $385/st FOB. In Texas, Agrifos was asking $410-$415/st FOB for truck sales and $410/st FOB for railcars, but was sold out through the end of September for rail-delivered phosphates.
U.S. Gulf: Slowdowns continued to be a problem on the Arkansas River north of Muskogee last week as a result of heavy buildup of silt after the Corps of Engineers opened dams to relieve high water and prevent flooding. In conjunction with Catoosa and Inola, which are north of Lock 17 at Muskogee, an excavator was sent south and cleared a narrow, 60-foot wide channel in the river. As a result, three barges in single file at the same time can move northward to those ports and terminals. However, the contents of each barge will virtually vanish soon after arrival. Normally, the season in that area kicks into high gear about August 15, and many of the terminals could run dry of products. The Corps was bringing a large dredging machine from Little Rock, but it will be another two to three weeks before the river returns to normal navigation. The trip from Rosedale to Muskogee takes approximately six days, and there were reports of a backlog of barges at Rosedale.
How phosphate sales will fare in Oklahoma was still a big question mark last week. Some dealers believed the demand will be great, but some of the traders were taking a more cautious position. The problem was the disastrous wheat crop – much of which rotted in the fields – and the uncertainty as to what farmers will do.
Last week, phosphate sales on the river system were extremely quiet. Some who did not buy said they believed they could obtain barges at Rosedale for as low as $398/st FOB due to some owners seeking to avoid high fleeting costs. However, no sales were made at that price or lower.
Based on actual sales last week, the NOLA DAP barge price range was $401-$403/st FOB, which was the same as the previous week’s range. Mosaic’s asking price was $405/st FOB; sales were made at the $403/st FOB level.
Eastern Cornbelt: DAP and MAP remained at the $430- $435/st FOB range for regional warehouses, with the low out of spot river locations and the higher numbers inland. 10-34-0 remained at $335-$350/st FOB regional shipping points to the dealer.
Western Cornbelt: DAP continued at $430-$435/st FOB regional warehouses, while MAP was running $430-$432/st FOB. Sources said the 10-34-0 market was at $345-$350/st FOB.
California: Super phosphoric acid pricing remained firm at $7.00/unit DEL in the state, with merchant grade at $6.90-$7.00/unit DEL. A nickel/unit increase for both products is expected this month, and again in September.
Sources said MAP was up $5/st FOB or DEL in August, to $450-$455/st FOB or DEL from $445-$450/st FOB or DEL in California, with DAP roughly $5-$7/st higher. 16-20-0 remained at $295-$300/st FOB or DEL. The 10-34-0 market remained at $310-$320/st FOB in the state, but a slight increase is likely in August due to higher phosphoric acid prices.
Pacific Northwest: Phosphoric acid pricing was firm at $7.00/unit DEL for both super phosphoric acid and merchant grade acid. A nickel/unit increase is scheduled for August, and again in September.
DAP remained firm at $442-$452/st FOB or DEL in the region, with the low in Montana. Sources said a $5/st increase was scheduled for mid-August, followed by a $10/st increase in mid-September. The same was true of MAP; sources tagged the market at $435-$445/st DEL in the region last week, depending on location, with increases slated for Aug. 16 and again on Sept. 16.
MAP postings from Agrium, effective Aug. 16, included $440/st DEL in Montana, $445/st DEL in southern Idaho and Utah, and $450/st DEL in Washington, Oregon, and northern Idaho. A $10/st increase is scheduled for all locations on Sept. 16. The company’s MAP postings FOB the warehouse in Washington, northern Idaho, and Oregon moved to $445/st on Aug. 16 and up $10/st FOB to $455/st on Sept. 16.
16-20-0 was firm at $300-$305/st DEL in the region, with a $2-$3/st increase scheduled for Aug. 16. Sources said the market will firm to $308-$313/st DEL on Sept. 16.
10-34-0 continued at $315-$325/st FOB in the region.
U.S. Export: Last week, PhosChem made a sale of 7,000 mt of DAP into Central America at $433/mt FOB, which was an increase of $3/mt FOB, despite the fact freight rates began to climb again last week.
Also last week, Pakistan was said to have purchased between 100,000 and 150,000 mt of DAP from China, Russia, and Australia at a price of $520/mt DEL. In addition, India issued a tender for another 150,000 mt of DAP, but it was unlikely PhosChem will make a bid as inventories were already too low.
TFI issued its export report for July. It was no big surprise that India was the biggest DAP customer, receiving 232,492 mt, with Japan a distant second at 34,932 mt, and Chile with 20,634 mt. For the month, total DAP exports amounted to 384,023 mt, a reduction of 33.6 percent from the same month last year. For the calendar year-to-date, India was still on top at 475,039 mt, with China next at 291,695 mt, and Mexico close behind at 273,166 mt. The total for the calendar year-to-date was 2,300,283 mt, which was 31 percent less than the same period a year ago.
Argentina was the biggest buyer of MAP in July, with 48,836 mt, and Japan was second at 10,337 mt. The total MAP exports for July were 106,454 mt, a decline of 57.7 percent from the same period a year earlier. For the calendar year-to-date, Canada has been the biggest customer for MAP with 423,157 mt; Argentina was next at 167,027 mt, and Brazil was the third biggest buyer at 163,567 mt. Total MAP exports for the calendar year-to-date were 1,257,294 mt, which was a 0.9 percent reduction from the same time in 2006.
Based on the most recent sales, the export DAP price range last week narrowed from $420-$430/mt FOB to $430-$433/mt FOB. Ocean freight rates will continue to affect FOB prices.
U.S. Imports: Phosphate rock imports were up 19 percent for the year ending June 30, to 2.05 million st from the prior year 1.73 million st. June imports were up 133 percent to 247,142 st from the year-ago 105,972 st.
POTASH
Eastern Cornbelt: Potash was firm at $250-$255/st FOB from the previous $245-$250/st FOB regional warehouses for limited spot tons, depending on grade and location. Indications were that potash prices will continue to rise into the fall season. However, many large dealers have already filled their bins.
Western Cornbelt: Potash pricing increased from $250-$260/st FOB the warehouse to $262-$265/st FOB, depending on grade and location, and additional supplies may not be available until the fall. Potash prices were likely to see additional increases.
California: Potash was quoted at a firm $255-$275/st FOB in the state, depending on grade. Potassium nitrate pricing firmed $20/st on July 11 to $500/st FOB for bulk and $560/st FOB for bags. Sulfate of potash (SOP) pricing was unchanged at $368-$378/st FOB in the state.
Pacific Northwest: Potash continued to be extremely tight. Rail-delivered potash was pegged at a firm $266-$277/st in the region, with the low for 60 percent and the high for 62 percent muriate. Sources said a $20/st increase is scheduled for Oct. 1.
Western Canada: Potash pricing continued to firm. Sources tagged the regional market at $280-$295/mt FOB regional plant sites or warehouses, and $280/mt FOB from the mine.
U.S. Imports: Potassium muriate imports were up 14 percent for the year ending June 30, to 11.2 million st, up from the prior year 9.83 million st. June imports were up a whopping 44 percent, to 855,819 st from 593,742 st.
Bangladesh: BADC has issued a tender to import 50,000 mt MOP in bags in a maximum of four lots on CFR (C) Chittagong or CFR (C) Mongla Port. The minimum offer is 12,500 mt. Offers are to be received up to Sept. 19, instead of Aug. 28, which was announced earlier.
SULFUR
Tampa: Late last week, five of Valero’s refineries – Port Arthur, St. Charles, Houston, Texas City, and Corpus Cristi – were either on turnarounds or were having problems that affected sulfur production. The amount of the combined loss of production was not available, but it will add to the already tight market. Sulfur producers and suppliers were having problems meeting amounts required by their contracts, and the situation did not look promising last week. So far, phosphate production has not been affected, but that could change if the situation worsens.
On the positive side, Hurricane Dean appeared to be taking a southerly tract, which should keep shipping lanes open in the Gulf of Mexico. However, August looks to be a robust month for the formation of storms off the coast of Africa, and the eyes of the industry will continue to watch the situation carefully.
Prill vessels out of the Gulf Coast were bringing healthy prices for shipments to Brazil, with prices confirmed in the $100/mt range. Sulfur on the world market continues to be extremely tight.
West Coast: Pricing for agricultural, industrial, and domestic liquid sulfur on the West Coast was said to be causing problems for suppliers there, who would like to keep that book of business. Those customers pay considerably less than sulfur for overseas sales as prill, and were threatening to discontinue purchasing. Conoco was said to have set a price for those customers at $18/t in order to keep the business, and Chevron was considering a similar move. The impact on the West Coast sulfur price index was not clear last week.
U.S. Imports: Imports were off 31 percent for the year ending June 30, to 1.53 million st from the prior year 2.2 million st. June imports were off 23 percent, to 124,529 st from 162,575 st.
Vancouver: Last week, China was said to be offering to purchase sulfur for between $220-$240/mt DEL, which would net an FOB price from Vancouver of $180-$200/mt. However, suppliers in Vancouver were already having difficulty meeting their obligations under existing contracts and had not taken advantage of the high-priced offers. Still, China was said to be building its inventory of sulfur, which may lead to an easing of the pressure on the world market – at least at some point.
MARKET NOTES
Warsaw: Polish nitrogen and phosphate production are reported to be up 11 and 10 percent respectively for the first half of 2007. As a result of a booming market, the government has inked a new contract with Saudi Arabia for the import of oil and gas. Poland is planning to build a new LNG terminal at Swinoujscie near the German border.