AMMONIA
U.S. Gulf/Tampa: The last done at Tampa remains $199/mt DEL for February. One industry observer last week predicted prices could move up in the near term, but speculated that they do not have much upside. In the meantime, buyers cited high inventories, idled phosphate plants, and diminished exports from the FSU as evidence why price ideas should remain on the low end.
Mosaic last week restarted its Faustina, La., ammonia plant, which was perhaps the biggest news in the generally quiet market.
U.S. ammonia imports were off 30 percent in December, according to DOC statistics, to 492,573 st from the year-ago 706,245 st. July-December imports are off 15 percent, to 3.65 million st from 4.3 million st.
Eastern Cornbelt: Anhydrous ammonia pricing remained in the $450-$525/st FOB range, with the low for cash tons in Illinois and the upper end for spring prepay offers. Sources said the lower numbers were meeting rail-delivered tons coming from production points in Oklahoma and Kansas.
Western Cornbelt: Anhydrous ammonia remained at $425-$525/st FOB regional terminals, depending on location and time of delivery. Missouri sources also quoted delivered ammonia in the low- to mid-$400s/st from production points in Oklahoma and Kansas.
California: Anhydrous ammonia pricing remained at $575-$620/st DEL in California, with the low for truck-delivered product and the high for railed tons. Aqua ammonia was steady at posted levels of $155/st FOB in the state. Sources said suppliers were trying to work through some inventory, with pricing adjustments likely to be announced again at the end of February.
Pacific Northwest: Sources pegged the anhydrous ammonia market at $575-$600/st DEL in the region, with the low reported in Washington for cash tons. One source speculated the spring prepay could still be booked at those numbers as well, though no actual business was confirmed.
Western Canada: Anhydrous ammonia was quoted at $799-$844/mt DEL in Western Canada.
Black Sea: Some demand is helping producers think the price should go up. Unfortunately for the producers, say sources, the demand is not strong enough or deep enough to justify any increase in prices. One trader noted that if it were not for the closure of facilities that service the Black and Baltic Seas, the price would drop.
Last week Stirol announced it was closing two ammonia units. The closure comes on the heels of other closures that have taken place throughout the Black Sea because of weaker demand.
Sources say it is only the producers making noise of a price increase. At the same time, buyers only make an approach when a buyer is firmly set. They are not bidding low largely because they do not want to get captured buying a cargo they may not be able to unload.
Middle East: Sources report producers are comfortable with orders for the rest of the month, but that some spot cargoes might be secured at reasonable prices. Of course, the definition of “reasonable” depends on which side of the negotiating table a person sits.
Contract sales have been steady, but not as brisk as sellers would like.
Observers note that Indian buyers have been around, but not at levels similar to previous years. One of the issues appears to be Indian buying of DAP.
Rather than make DAP, which would necessitate ammonia purchases, a number of Indian firms are opting to import the final product.
Some DAP producers are still running in India. The last bit of business done was a couple of weeks ago, when the price moved to $200/mt FOB. Nothing has happened since to move the price either way, say sources.
Asia: The only buyers seen regularly in the market these days are agents from Korean and Taiwanese fertilizer companies.
Industrial buyers are still facing the problem of moving their own final product to consumers. They are not, therefore, in any position to draw down the current supplies of ammonia they hold, let alone buy more tons.
Purchases from fertilizer manufacturers in Taiwan and South Korea have been steady, but hardly strong enough to move markets. Most of these purchases are done under contract or long-term agreements with traders and producers.
The KPI plant in Indonesia remains down. Plant managers are reportedly ready to start production again at any time. The accountants, however, point out that in the current market situation, it is better to keep the plant closed rather than bring more ammonia into an already soft market.
The best guess for a re-start of the plant is now late February or early March, depending on market forces.
Western Europe: Demand has been just strong enough and supplies from Russia and Ukraine just weak enough that prices have reportedly edged upward in Northwest Europe. European sources now peg the market at $270-$290/mt C&F.
UREA
U.S. Gulf: New prompt granular barge trades were put in the $303-$305/st FOB range last week, with offers on the table at $307/st FOB, according to sources last week. While demand is not overwhelming, said sources, it is enough to keep prices moving up at a slow and steady pace.
U.S. urea imports were off 53 percent in December, to 309,694 st from the year-ago 658,029 st, according to DOC. July-December imports are off 17 percent, to 2.67 million st from 3.22 million st.
Eastern Cornbelt: Granular urea was steady at $355-$365/st FOB in the region.
Western Cornbelt: The granular urea market was tagged at $350-$365/st FOB to the dealer.
California: Granular urea remained at $440-$450/st FOB, with the upper end reflecting postings and the low after small discounts.
Pacific Northwest: Granular urea was pegged in at $395-$400/st FOB and in roughly the same range for delivered tons, reflecting a slight drop from last report. One source said no sales are being made at posted levels of $440/st DEL.
Western Canada: Granular urea was steady at $560-$585/mt DEL in the region.
Pakistan: TCP called a tender for 200,000 mt to close Feb. 21 with validity until Feb. 23. Sources say TCP is buying the urea to build up stockpiles for the next application season. The move is seen as more as a political one rather than one based on actual need.
Just as the tender was announced, the Senate Standing Committee on Food, Agriculture and Livestock recommended easing the rules on importing urea. The committee also said Pakistan should arrange to import 100,000 mt of urea each month.
The committee’s report argued that steady, long-term purchases would prevent panic buying by farmers and develop a strong reserve supply of urea.
The reaction from area traders to the committee recommendation was the verbal equivalent of rolling one’s eyes.
One observer said the suggestion was designed more as a political statement. While steady purchases of urea over a long period of time would help reduce the spikes and valleys in urea pricing, he said, overall a commitment to make such a large scale purchase on a regular basis will only serve to drive up the international price.
Indonesia: The Indonesian government tasked Kujang and Gresik to each import 250,000 mt of urea this year.
Urea demand in Indonesia has grown beyond what the state-owned companies – Kujang, Gresik, PIM, and Kaltim – are able to supply, President Susilo Bamban Yudhoyono told area media.
International traders said they will wait for details as to how the two companies will make the purchases before they get excited.
One trader noted that the trade minister said Indonesia could purchase its urea from Ukraine, the Middle East or China. The trader said unless the minister was referring to the border trade Chinese urea that is slipped over the Vietnam border without any export duty, Chinese product would be too expensive for Indonesia.
The move was seen by Asian industry observers as a move by the government to shore up support among the farmers and plantation owners by promising more than enough urea for the coming year.
Sources report that last year the government was under pressure to deny urea export licenses to PIM and Kaltim to ensure better local supplies, even though there were only sporadic reports of shortages in the country.
To some in the international markets, the announcement of buying half a million mt of urea strikes them as a political move rather than as a fully-thought-out plan.
Government figures say Indonesia will need 7 million mt this year, and the local producers cannot handle that demand. One source did note, however, that the 7 million mt figure is contingent on perfect weather throughout the year.
The government has been working on plans to reorganize the urea production operations in the country. In addition to administrative changes, the government is looking to build new plants or revamp old ones to be more efficient. Likewise, the government is working with natural gas suppliers to ensure plants have all the feedstock necessary to run at peak efficiency.
One of the major problems the urea producers have faced in recent years is the lack of a steady supply of natural gas to the plants. A recent agreement among the producers, the national natural gas company, and ExxonMobil has kept the gas steadily flowing.
Black Sea: At least two producers have taken down production units, further tightening the availability of urea in the area.
Plants in Ukraine and Romania are shutting down because of low prices and lack of strong interest.
Some of that might change on the heels of the TCP/Pakistan tender.
Sources report the paper trade in Yuzhnyy is now being quoted as high as $288/mt FOB. However, no one could point to any real business at that level.
Likewise, market bears saying the price is in the mid-to-upper $260s/mt FOB are also being dismissed by many in the industry.
Industry sources say the price is hovering around the $280/mt FOB mark, but again are unable to point to firm business to help plot the price.
Discussions reportedly are centering in the upper $270s/mt FOB, with an occasional nod to peeking over $280/mt FOB.
The industry now seems to be waiting to see what kinds of offers are made in the TCP tender.
Middle East: Producers report being sold out for February and March. Sources point out that these deals are contracts being fulfilled while some plants are in extended turnarounds. Traders are convinced the producers are really sold out. There does not appear to be any of the “we might have tons if the price is right” kind of discussion going on. Producers are rebuffing any attempts to engage in discussions about February or March cargoes.
Prices last quoted put granular at $300-$310/mt FOB and prills at $290-$300/mt FOB.
With no new spot business to point to, sources say previous pricing ideas are still the public figures. However, some observers note that when the TCP tender comes out Feb. 21, if any of the producers offer tons, the price will be significantly higher than current levels.
Many in the industry are waiting to hear more about the discussions that took place at the Arab Fertilizer Association last week. The conventional wisdom says prices will move up rapidly on the TCP tender.
Asia: A few buyers have begun to make inquiries to traders in the past couple of weeks. Sources say local stockpiles are beginning to thin out, and individual country buyers are now looking to pick up a few tons to ensure there are no pictures of empty warehouses to scare the farmers.
What appears to be happening, say sources, is that potential buyers are looking for small quantities at low prices they can mix with the more expensive urea they already own.
South Korea, Thailand, and Vietnam have all been sniffing around looking for tons.
NITROGEN SOLUTIONS
U.S. Gulf: The barge market remained quiet last week. December imports were off 74 percent, to 99,983 st from the year-ago 389,023 st, according to DOC. In the meantime, as earlier reported, year-to-date UAN import stats appear to be extremely inflated (6 million st versus year-ago 1.8 million st), and TFI has asked DOC to investigate.
Eastern Cornbelt: UAN-32 pricing to the dealer remained at $275-$285/st ($8.58-$8.91/unit) FOB regional terminals for cash or prepay offers.
Western Cornbelt: The UAN-32 market was generally quoted in the $275-$280/st ($8.59-$8.75/unit) range FOB regional terminals to the dealer for cash tons.
California: UAN-32 remained at $375-400/st ($11.72-12.50/unit) FOB regional terminals, with the upper end reflecting dealer postings. Sources continued to report rail-delivered tons coming into the state from the Midwest at much lower levels, however, with most quoting levels around the $300/st ($9.38/unit) DEL mark, give or take.
Pacific Northwest: The UAN-32 market was pegged in a broad range at $285-$335/st ($8.91-$10.47/unit) DEL in the region, with the low confirmed by Washington sources for spot tons.
Western Canada: UAN-28 pricing was pegged at $353-$368/mt ($12.61-$13.14/unit) DEL to the dealer.
AMMONIUM NITRATE
U.S. Gulf: The market remained quiet last week. December imports were off 63 percent, to 45,732 st from the year-ago 124,261 st. July-December is off 41 percent, to 328,956 st from 555,430 st.
Western Cornbelt: Ammonium nitrate was pegged at $270-$305/st FOB, reflecting a slight increase from last report.
California: No market was reported for ammonium nitrate in the state. CAN-17 remained at $270-$285/st FOB in California in early February.
Pacific Northwest: Ammonium nitrate pricing was reported at $348-$353/st DEL, reflecting a slight drop from last report. CAN-17 was reported at $222-$225/st FOB in the region, also down from last report.
AMMONIUM SULFATE
Eastern Cornbelt: Granular ammonium sulfate was tagged at $165-$200/st FOB in the region. Sources said Honeywell announced on Feb. 10 that it was not accepting new orders for granular and mid-grade ammonium sulfate until further notice due to a “current backlog of orders.”
Western Cornbelt: The granular ammonium sulfate market was reported in a broad range at $150-$200/st FOB last week, with the low in Missouri and the upper end reflecting new dealer list pricing in Iowa from some suppliers.
California: Ammonium sulfate pricing was down from last report at $275-$280/st FOB in the state.
Pacific Northwest: Granular ammonium sulfate was reported at $210/st DEL in the region, give or take.
Western Canada: Granular ammonium sulfate remained at $350-$355/mt DEL in the region.
U.S. Imports: December imports were off 20 percent, to 25,215 st from the year-ago 31,583 st. July-December imports were off 12 percent, to 162,100 st from 184,751 st.
PHOSPHATE
Central Florida: Corn, the fertilizer industry’s favorite crop, was on the minds and lips last week. How much would be planted? A couple of sources said it would likely be between 82 million and 89 million acres, and the answer will have a major impact on phosphate sales for the spring season. The price has been relatively stable at around $4/bushel and the price of fertilizers was far below the previous year, so it was more a matter of the corn market. Some will go to traditional customers, such as feeding the world, but a big chunk would have to go to ethanol. One hopeful source said he believes the new administration and its green agenda will promote the use of ethanol. After all, President Obama is from Illinois, a major corn-producing state, and it seemed likely that would happen.
Sulfur suppliers to the phosphate industry said last week that deliveries have increased recently, and they believe production may be going up. Phosphate sources said that was true, but only to a small degree. With a recent splurge in sales, inventory has dropped and replacement material was being produced, but the industry was still well below normal. In its recent earnings release, CF reported that its Plant City phosphate processing plant operated at 85 percent capacity during the fourth quarter, but scaled back to 40 percent at the beginning of the year.
Phosphate sales were actually happening in Florida last week but most were done under a formula basis. The Central Florida DAP price range remained at $305-$315/st FOB, based on recent sales. CF was said to be asking $310/st FOB for DAP and $330/st FOB for MAP. PCS Sales had no published price. Mosaic had no posted price for Central Florida, but was said to be selling at $305-$315/st FOB, and up to $330/st FOB for MAP. The lowest prices were for big buyers, while dealers could expect to pay as much as $50-$60/st FOB more. The price from Agrifos was $350/st FOB for trucks and $340/st FOB for rail shipments.
U.S. Gulf: Areas supplied by the Arkansas River finally got some much-needed rain last week– more than two inches at Tulsa – but the package included some deadly tornadoes. Barge supplies on the Arkansas were said to be slow last week, as activity at warehouses was picking up and product was moving out. Sales of phosphate and urea were brisk, but potash was minimal. DAP barges from New Orleans to Rosedale were not a problem, but the pick-up at Rosedale included a wait of several days.
Warehouse prices continued to hold up well in relation to barge cost, and DAP was bringing as much as $360/st FOB on the Arkansas and $350-$355/st FOB on the Illinois. Some areas were seeing DAP prices as low as $330/st FOB.
The logjam of NOLA DAP barges on the river system eased significantly during the past few weeks after Mosaic’s recent spate of sales. Inventories in general were declining as dealers began refilling empty bins. The season will probably be closer to average than earlier anticipated, said sources, if activity in Oklahoma was an indication. As interest in buying fertilizer has begun to increase on the gulf and river system, the rest of the world was also getting back into the game. Mosaic has restarted its ammonia plant at Donaldsonville and DAP production was increasing, although still far below capacity. Processing plants will begin to return to something more like normal capacity once demand becomes steady and inventories decline to a reasonable level.
Last week, MAP, which was somewhat scarce, was selling at a premium of about $15/st FOB to DAP. There was no change in prices, as prompt NOLA DAP barge prices were running from a low of $310/st FOB to $315/st FOB last week, but most were $315/st FOB by the end of the week. MAP barges were done at $330/st FOB.
Eastern Cornbelt: DAP out of regional river terminals was quoted in the $355-$370/st FOB range last week, with MAP $15/st higher. Inland warehouse prices remained as high as $400/st FOB for DAP and $415/st for MAP in some locations. Sources said MAP sales have picked up, and supplies out of some river locations were low.
10-34-0 continued to be quoted in a very broad range at $650-$900/st FOB in the region.
Western Cornbelt: DAP was quoted at $360-$370/st FOB most regional warehouses to the dealer. MAP had reportedly moved to a $15/st premium to DAP, and was in tight supply at some locations. “We can’t keep it in,” said one Missouri supplier about MAP inventories in early February. Several sources said they think dry phosphate inventories will tighten up quickly when movement begins in earnest.
The 10-34-0 market continued to be quoted in the $600-$675/st FOB range in the region, with the low in Nebraska and the upper end in Iowa. One Missouri source pegged the dealer market firmly at the $650/st FOB level last week.
California: Effective Feb. 1, Simplot raised its phosphoric acid postings by 50 cents to $10.50/unit DEL in California for both superphosphoric acid (SPA) and merchant grade acid (MGA), with the latter also posted at $10.70/unit FOB the warehouse. Agrium’s February pricing levels remained at the $1,000/st rail-DEL mark in the region for both SPA and MGA.
MAP and DAP were unchanged at $455-$460/st DEL or FOB warehouse. Simplot’s list price for 0-45-0 TSP with Avail was steady at $425/st rail-DEL or FOB French Camp. The 16-20-0 market was quoted at $320-$327/st FOB.
10-34-0 pricing was pegged at $470-$480/st FOB in California, up slightly from last report, with the low in the Central Valley and the high in desert locations.
Pacific Northwest: MAP remained at $445-$455/st FOB or DEL in the region, with DAP in roughly the same range. 16-20-0 was steady at $300-$305/st DEL, with dealer postings reported as high as $335/st FOB from some regional suppliers. Simplot’s reference prices for TSP with Avail were in the $420-$425/st FOB range in the region.
10-34-0 pricing was up from last report, with sources tagging the dealer market at $465-$495/st FOB in the region.
Simplot hiked its SPA and MGA postings by 50 cents on Feb. 1, bringing reference levels to $10.50/unit DEL in the region. Agrium’s postings reportedly remained at $1,000/st rail-DEL for both SPA and MGA.
Western Canada: MAP was unchanged at $790-$825/mt DEL to the dealer in Western Canada.
U.S. Export: Vietnam made two buys from the U.S. last week, 30,000 mt of DAP each from Keytrade and Transammonia, for a total of 60,000 mt at a price that worked out to $360/mt FOB, slightly up from the previous export sale price of $358/mt FOB.
Although India announced its purchase of 1.2 million mt from Russia a couple of weeks ago, it will still need additional tons this year. It did reach an agreement with Morocco on phosphoric acid, but that will not be sufficient to meet its needs.
Ethiopia purchased 200,000 mt of DAP, but the source and the price were not available. Europe was buying last week, and although the phosphate was coming from Russia and Lithuania, that does help reduce the world’s supply and open future markets.
Brazil and Argentina were showing interest last week and will probably be in the market sometime soon.
TFI reported a discrepancy with the U.S. Department of Commerce on the number of tons of MAP exported since 2005. For 2008, TFI said 1.46 million st, while the DOC reported 2.74 million st.
Based on the sales to Vietnam, the export DAP price range increased from a flat $358/mt FOB previously to $358-$360/mt FOB last week. Exports should increase during the next few months.
India: Indian buyers are claiming they have officially broken the “cartel” on phosphoric acid prices. As a result, prices are being called $730-$760/mt DEL. Reportedly, the new levels have been achieved by Coromandel with Groupe Chimique Tunisien and Foskor of South Africa, as well as by Zuari Industries with OCP. The $730/mt number is reportedly for cash with the $760/st 150-day credit.
POTASH
Eastern Cornbelt: Potash was quoted at $700-$800/st FOB regional warehouses, depending on grade and location, with the lower numbers reported in Illinois. Few new sales were reported to test those levels, however.
Western Cornbelt: Potash out of regional warehouses was tagged in the $700-$740/st FOB range to the dealer, depending on grade and location. In Missouri, the market was quoted at $710/st FOB for red granular and $720/st FOB for white granular potash. Interest remained low at both the wholesale and retail levels. “We’re moving one load of potash for every 25 loads of MAP,” said one regional supplier.
California: Muriate of potash pricing remained at $849-$875/st FOB and $875-$900/st DEL in the region.
Sulfate of potash was quoted at $1,015-$1,055/st FOB for bulk quantities, with the low for standard grade, the high for water soluble, and bulk granular SOP reported at the $1,028/st FOB mark.
Potassium nitrate remained at $1,310-$1,380/st FOB in the state, with the low for bulk and the upper end for bagged product.
Pacific Northwest: Potash remained at $854-$900/st DEL in the region, with FOB warehouse levels quoted in the $840-$890/st range. Sources reported few new sales taking place, and one source said potash consumption will be off considerably this spring in his trade area.
Western Canada: Reference prices for potash remained at $988/mt FOB Saskatchewan mines to Canadian customers. No updated delivered prices were reported for the region last week.
U.S. Imports: Imports were off 19 percent in December, to 711,286 st from the year-ago 873,265 st. July-December imports were up 22 percent, to 6.4 million st from the year ago 5.27 million st.
SULFUR
Tampa: Phosphate producers in Florida were taking more sulfur than they have since November, according to sources, but the amount was still well below normal. Inventories of DAP and MAP were declining last week as dealers began filling bins for the spring season, and offshore customers were starting to buy once more. That’s not just good news for the phosphate industry, but for sulfur producers as well. The oversupply situation has not really improved much, but at least it has not gotten worse in the past week.
Some refineries were doing turnarounds last week, which helped reduce sulfur supplies and push up prices at the pump.
Prill was moving out of Beaumont and inventories there were half or less than half of Martin’s 150,000-mt capacity last week. Three or four vessels will be loaded and shipped from Beaumont in February/March, which helps eat up the inventory.
West Coast: Negotiations for first-quarter contract prices for sulfur were still ongoing last week, and already-low prices may decline a bit more.
U.S. Imports: Imports were off 53 percent in December, to 77,999 st from the year-ago 165,108 st. July-December imports were up 13 percent, to 1.15 million st from 1.02 million st.