AMMONIA
AMMONIA
U.S. Gulf/Tampa: The Tampa ammonia price has dropped $40/mt for June to $510/mt DEL, according to sources. Yara was reported to have agreed to this number with Mosaic.
In the meantime, there were reports of NOLA prompt business being done at $580/st FOB, down $30/st FOB from the long-standing benchmark. Sources have speculated for some weeks that that number has been under pressure and should see a drop.
Eastern Cornbelt: Sources continued to quote the spot ammonia market at $800-$820/st FOB regional terminals, with the low end out of spot Illinois River locations and the higher numbers reported in Indiana. Movement was described as spotty last week. Some suppliers continued to reference very bullish numbers for forward contract tons, with postings as high as $1,020-$1,030/st FOB in the region for June forward.
Western Cornbelt: The ammonia market remained at $760-$800/st FOB regional terminals for spot tons, with delivered ammonia quoted at the $810-$820/st range in central Missouri from southern production points. One source reported booking some fall prepay tons recently at the $885/st FOB level, and some suppliers were referencing forward contract ammonia for as high as $1,000-$1,020/st FOB in the region for June forward shipments.
Southern Plains: Ammonia prices were strengthening. Sources tagged the market at $700-$760/st FOB regional terminals, up from numbers in the mid- to high-$600s/st FOB one week earlier. Pricing out of regional production points was reported in the $700-$725/st FOB range, while pipeline terminals were said to be at the upper end of the range to the dealer. A Colorado source reported booking tons for immediate shipment at the $700-$710/st DEL level at mid-month, but speculated that delivered prices were higher last week.
Agrium reposted anhydrous ammonia on May 6 to $725/st FOB Clay Center, Kan.; $720/st FOB Conway, Kan.; $715/st FOB Mocane, Okla.; and $695/st FOB Borger, Texas. Agrium’s delivered postings from the Borger facility moved on May 6 to $720/st in Texas north of Interstate 40, and $725/st in Texas and Oklahoma south of Interstate 40. Those levels reflect a $50/st increase from the company’s April 28 ammonia postings in the region.
Sources said retail pricing has definitely not kept up with replacement costs on nitrogen products. “This doesn’t do any real favors for the end farmer customer,” said one source. “If the retailer is not willing to take the time to keep pace with the market and make incremental moves and they then have to take major steps to keep up, they had better keep a defibrillator handy to use on the customers that suffer from the price shock.”
South Central: The anhydrous ammonia market was pegged at $650-$700/st FOB regional terminals, with the low for spot tons FOB Memphis, Tenn.
Black Sea: Despite the official KIP of $420/mt FOB, sources report buyers are pushing for much less ?Çô and suppliers are ready to listen. The lack of demand from the U.S. is reportedly driving the softening of prices in Yuzhnyy.
One Asian source noted that eventually the government in Kiev will have to adjust the KIP downward. The representative of a producer in the Middle East said he figured the price would not drop below $400/mt FOB. Others said sub-$400/mt FOB is likely.
No matter what the market says, unless the government drops the KIP, any deals below $420/mt FOB will have to remain in limbo.
As far as the participants at the IFA conference are concerned, the price remains soft ?Çô but not anemic ?Çô at $420-$440/mt FOB.
Correction: Due to a typographical error in the Black Sea ammonia report, Green Markets last week reported the official lowest price