AMMONIA
U.S. Gulf/Tampa: Major players in Tampa have concluded new business for September at $325/mt DEL, some $5/mt lower than the last done business by a trader. Sources had speculated that large phosphate buyers would be able to obtain at least some discount to the previous $330/mt.
What with strong Tampa ammonia prices once again, one source last week wondered if the new AUM plant in Trinidad might be better off pumping ammonia into the market rather than UAN, which it is scheduled to begin producing in the first half of November (GM Aug. 24, p. 1). While getting ready to produce UAN, Koch is marketing AUM’s ammonia, which began production earlier this year.
As of Aug. 27, Direct Hedge (DH) reports the Tampa paper market as $310-$330/mt September, $300-$320/mt October, and $270-$290/mt for November-December.
Natural Gas: Prices continued to weaken again last week, with the September NYMEX futures price expiring at $2.843/mmBtu, the lowest prompt month number in 7 ½ years. During the day, the price dropped as low as $2.692/mmBtu before making a comeback.
Generally, high levels of gas in storage brought on by a relatively cool summer, as well as diminished industrial demand, have contributed to the drop. Add to this, ample gas production. A hot autumn, the hurricane season, and an early winter could all turn things around.
Eastern Cornbelt: Sources reported few changes to the spot fertilizer prices, and little new activity to test the markets. Anhydrous ammonia continued to be quoted in the $345-$370/st FOB range in the region, depending on location and time of delivery. Forward contract tons for September through December were reportedly being offered at $360-$365/st FOB in Indiana and $365-$370/st FOB in Illinois.
Western Cornbelt: Sources reported minimal changes to the spot fertilizer markets. Anhydrous ammonia remained at $315-$340/st FOB regional terminals for cash market tons.
Northern Plains: Sources quoted anhydrous ammonia at $355/st DEL in North Dakota for fill tons, with the market reportedly firming on Sept. 1 to the $375/st DEL mark. Fall prepay remained at $375-$380/st DEL in North Dakota. Out of regional terminals, the spot ammonia market was pegged at $350-$360/st FOB. Effective Aug. 12, Agrium’s anhydrous ammonia postings moved to $370/st FOB Mankato, Minn. One supplier was offering forward contract ammonia for September through December at $360-$370/st FOB in the region.
Great Lakes: Anhydrous ammonia was quoted at $345-$370/st FOB in the region, although most sources said the last tons bought were fall prepay booked earlier at lower numbers. Several sources reported some interest at the retail level for both fall and spring 2010 tons. One supplier was referencing forward contract ammonia for September through December at $360-$365/st FOB Indiana terminals.
Black Sea: To the joy of producers, natural gas prices are down and ammonia prices are up. But the difference is still not enough to tempt the Ukrainian producers to start up their plants.
Ammonia prices moved solidly in the upper $260/mt FOB last week on the heels of strong demand from the U.S., Turkey, and Asia.
Asian sources say the price is getting closer to the point where the product will cover production costs. The current estimated price for natural gas into Ukraine is just under $200/1,000 cubic meters. Sources say at that level the break-even price for ammonia is now around $300/mt.
The only plants running in the area are Russian facilities that get breaks on gas prices and are more efficient.
The dearth of material in the region and the growing demand is moving up the price. Sources report that a recent vessel had to wait an extra day for loading because the full cargo was not at the port facilities.
Industry observers are watching the rise in prices carefully. If the price moves back up to levels that would allow the Ukrainian plants to come back online, sources say the influx of millions of tons of annual production could once again cause the price to plummet.
As of Aug. 27, DH reported the Yuzhnyy paper market at $270-$280/mt for September-October, $250-$270/mt for November, and $245-$260/mt December.
Middle East: Producers continue to work at full capacity to meet demand.
Sources report Fertil has one cargo available for sale at $265/mt FOB. No one is ready to step up and pay that much, said one trader, so it looks as if the tons will be handled in a swap deal.
The extra tons apparently came into being when Fertil had problems with its urea operation. The decline in urea production led to the sudden influx of ammonia. To make matters worse for Fertil, it did not have a vessel lined up and ready to take the cargo.
So, said one source, the company offered the tons at a high price – about $20/mt above the last done business. Fertil reportedly fully hoped for and expected a trader with a vessel to take the material away quickly.
Despite Fertil’s effort to move the price into the $260s/mt FOB overnight, sources say the market price remains in the mid-$240s/mt FOB.
India: Buyers continue to take as many tons as can be bought. Sources say the only dampening influence on purchases is a growing concern about the impact of the late monsoon rains.
The lateness of the rains is pushing back the application and growing season. Sources are still unsure how much this will affect the DAP applications. This uncertainty extends to the ammonia buying.
For now, the Indian buyers are taking all they can just in case the country has a normal application season. If demand for DAP does drop, sources said the buyers can curtail their end-of-season buying and work off the stockpiles on hand.
Asia: Demand remains strong. Buying in this area, combined with Indian and American orders, is pushing the market
prices up. The main sources for Asian buyers remain ASEAN countries and the Middle East.
UREA
U.S. Gulf: Most new business last week for granular was being put between $270-$275/st FOB. This was mainly for product on vessels arriving at the end of the month. Other sellers, however, argued that any product already on the water should garner a higher price as it was ready to go and should get a premium. As a result, some sellers were quoting $280/st FOB last week.
Sources reported good demand in wheat country; however, many questioned whether this demand was enough to keep NOLA prices up, what with an onslaught of imports expected and weaker prices on the paper market. Some were betting prices would continue to drop and the market would soon see $250/st FOB.
The DH paper market as of Aug. 27 was showing September at $265-$268/st and October-December at $245-$255/st FOB. First quarter 2010 was $250-$260/st FOB.
Eastern Cornbelt: Granular urea pricing was steady at $325-$335/st FOB regional terminals, with few new sales to test the market.
Western Cornbelt: Granular urea was steady at $315-$335/st FOB regional terminals, with the low out of Mississippi River locations and the upper end out of spot Missouri River terminals.
Northern Plains: Granular urea was quoted at $345-$355/st DEL in North Dakota, with the Twin Cities market reported at $315-$320/st FOB on the low end. One supplier was referencing forward contract urea for September at $335/st FOB Pine Bend, Minn., and $360/st DEL in North Dakota and northern Minnesota.
Agrium’s Aug. 7 postings for granular urea included $335/st FOB Marion, S.D., and North Dakota locations at Alton, Carrington, Colfax, Scranton, and Grand Forks, and $340/st rail-DEL in Minnesota, Wisconsin, and the Dakotas.
Great Lakes: There was little activity to test the spot fertilizer market last week. Sources quoted granular urea pricing at $325-$345/st FOB in the region, with the upper end out of Michigan warehouses to the dealer. One source described inventories as tight in late August.
Northeast: The granular urea market was tagged at $325-$335/st FOB in the Northeast region, with delivered tons quoted at the $345/st level to some locations. Some locations on the East Coast remained out of product, and won’t be refilled until October, sources said.
Black Sea: New deals put the market price below $240/mt FOB last week, with every expectation that the price will be below $230/mt FOB this week.
A cargo sold out of Yuzhnyy at $237-$238/mt FOB last week. Sources say it was a full cargo – at least 30,000 mt – and most likely heading for Turkey.
Sources say as the week closed, producers were seriously entertaining numbers $10/mt lower. Reportedly, bids coming in at $227-$228/mt FOB were not being rejected.
Few expect to see any major move on prices until October or so. By then, India and Pakistan will most likely need tons to cover the next application season.
Unfortunately for the producers, any shipments slated for November will have to face Chinese material as a competitor.
China: Talk of extending the 10 percent export duty past Sept. 15 disappeared last week. Sources report previous rumors of an extension were most likely the result of producers hoping to squeeze out a few more offshore deals.
Asian traders noted that the ports with urea are backed up, with some vessels sitting at anchorage waiting to be loaded.
One trader noted that even with the delays already happening at the ports, any urea that is already in a bonded warehouse will be allowed to leave at the lower rate. This decision by the central government is in sharp contrast to previous years, when only material already on an outbound vessel could receive the lower duty.
Sources say the customs office stepped up its enforcement by adding more people to the ports, and provided for better management of the paper trail for exports. Now, say sources, even if the material is loaded after the deadline of Sept. 15, anything from a bonded warehouse will be covered by the lower duty.
One trader said that once the urea enters a bonded warehouse, it is in effect shipped off shore. The next window of opportunity for exports at the lower rate begins Nov. 1.
As of Aug. 27, DH put Yuzhnyy at $235-$240/mt for September and $230-$235/mt October-December.
Middle East: Producers continue to stretch out maintenance programs and reduce output.
Sources say the area of discussion is now in the low- to mid-$260s/mt FOB. Unfortunately, that price is still too high for what buyers are willing to pay.
The last bit of public business keeps the area price in the low $270s/mt FOB for both prills and granular. Despite all the talk of a $10/mt drop in prices, nothing has been done in the public market.
Sources note that shipments going out now are based on either previous tenders or long-term contracts.
Traders report getting phone calls from producers anxious to move cargoes. But even in the $260s/mt FOB, they say it is difficult to find a home for the material.
The Saudi aid package to Pakistan is still under discussion. The US$100 million deal is designed to help Pakistan buy the urea it needs for the upcoming Rabi season. The deal, if consummated, could provide Pakistan about 370,000 mt at the current market level. Sources say Pakistan would be paying a premium for its urea based on the current market conditions, but the soft loan offered by the Saudis would free up money for other projects.
For the Saudis, a deal with Pakistan would help ensure a full order book into the fourth quarter.
Pakistan: Local media report the Fertilizer Review Committee reported to the government that the country was short by 200-300,000 mt for the upcoming Rabi season. The shortage could be easily covered if the Pakistan government accepts the Saudi US$100 million financial package that was presented earlier this month. Sources say the Saudi money would probably be used to by Sabic tons. If the package is accepted, TCP would most likely call a tender for 100-150,000 mt to test the market prices.
If current estimates of the strength of the market are accurate, sources say Pakistan would be able to make a case for softer prices than are currently being quoted by Middle East suppliers. Sabic could hold out for higher prices knowing that any use of Saudi money would be tied to buying Saudi product. For TCP, the issue would be to accept a higher price for urea and use someone else’s money, or use its own money to buy tons at a lower price. Several observers in the industry say the Pakistan government would be hard pressed not to take the Saudi package and put its own limited resources elsewhere.
No matter what the government plans to do, sources in the area are convinced TCP will be calling a tender by mid-September.
Industry observers say much of what drove Pakistan back into the market a couple of months ago – and what is driving it now to look for a tender in early September – is politics. Perceived shortages of urea in key areas around the country are prompting local politicians to demand that the central government order more urea be imported.
Asian traders agree some more urea will need to be imported for the upcoming application season. They also agree, however, that Pakistan has enough on hand to get the season started. Making large-scale purchases too soon could lead to spikes in the price, they say.
India: Indian buyers are no longer talking to traders or producers about prices or cargoes.
The round of talks that took place earlier this month led many to speculate that a tender might be called soon. Then, as buyer agents began indicating they would be looking at late-October to early-November loadings, industry watchers said the Indians were sending a message that they had enough material on hand to wait until the Chinese urea is once again in play.
The delayed monsoon rains are playing havoc with usage estimates. Sources say the drought conditions affected too many areas for too long for any serious recovery to take place. One trader estimated that India’s urea demand might be down as much as 10 percent because of the late rains.
While industry observers look to their tables and weather charts, the Indian government is listening to local politicians, who are in turn listening to the fears of a urea shortage from their constituents.
Sources say that while the Indian urea pipeline is not as full as in previous years, it is not empty. Local distributors used to seeing full warehouses at this time are concerned that what is on hand will not be enough for the next set of applications.
International traders say more than enough is on hand to start the season.
The gap between a perceived shortage and what the industry experts say is where political leaders are positioning themselves. Pressure to buy more urea at this time, said one international trader, makes no economic sense – but loads of political sense.
Indonesia: India and Pakistan are mirror images of a problem facing Indonesia. Urea producers are anxious to get export permits. The government, however, is hesitant to issue any because of fears local distributors and farmers will perceive a urea shortage if tons go offshore.
Sources report that not only are warehouses throughout the distribution network full, but many producers must store material outside.
One trader said that once the government is sworn into office in October it might relax and allow some exports to take place.
Besides wanting to make sure that farmers do not see a potential shortage of urea because of exports, the government also does not want to increase unemployment by stopping production at the state-owned plants. The result is the growing inventory of urea.
Industry observers say once the export permits are granted, just about every producer will be offering tons into the global market.
Bangladesh: BCIC closed tenders for 25,000 mt each of prilled and granular urea. The small quantity asked for told industry observers that BCIC was being just as cautious as everyone else in the market. Apparently, the buyer did not want to get out too far in front in a changing market.
Offers were filed separately for Chittagong and Mongla ports. Results follow.
BCIC tender for 12,500 mt granular urea for Chittagong |
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| Company | FOB (US$/mt) | CFR (US$/mt) | Origin |
| Trade Metrics | 270.00 | 305.00 | China, Russia |
| Bulk Trade | 282.80 | 317.80 | China, Middle East, Indonesia, Malaysia |
| PGP Int’l | 294.00 | 325.00 | Middle East, Russia, Ukraine, Belarus |
| Gavilon | 274.15 | 326.40 | China, Egypt |
| Wilson Int’l | 300.20 | 332.20 | Middle East, Russia, Ukraine, Belarus |
BCIC tender for 12,500 mt granular urea for Mongla |
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| Company | FOB (US$/mt) | CFR (US$/mt) | Origin |
| Trade Metrics | 270.00 | 308.00 | China and Russia |
| Helm | 286.50 | 314.50 | China |
| Desh Trading | 282.80 | 319.80 | China, Middle East, Indonesia, Malaysia |
| PGP | 291.50 | 327.50 | Middle East, Russia, Ukraine, Belarus |
| Gavilon | 274.15 | 330.90 | China and Egypt |
| Wilson Int’l | 299.20 | 335.20 | Middle East, Russia, Ukraine, Belarus |
BCIC tender for 12,500 mt prilled urea for Chittagong |
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| Company | FOB (US$/mt) | CFR (US$/mt) | Origin |
| Trade Metrics | 260.00 | 295.00 | CIS, China, Russia |
| PGP Int’l | 272.50 | 303.50 | China, Malaysia, Indonesia, Middle East, Ukraine, Russia |
| Liven | 271.97 | 304.97 | China, Middle East, Malaysia, Indonesia, Vietnam |
| Bulk Trade | 271.65 | 306.65 | China, Indonesia, Middle East, Russia, CIS countries |
| Helm | 279.45 | 309.45 | China Wilson Int’l 284.80 316.80 China, Middle East, Malaysia, Indonesia, Vietnam |
BCIC tender for 12,500 mt prilled urea for Mongla |
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| Company | FOB (US$/mt) | CFR (US$/mt) | Origin |
| Trade Metrics | 260.00 | 298.00 | CIS, China, Russia |
| Desh Trading | 271.45 | 308.45 | China, Indonesia, Middle East, Russia, CIS countries |
| PGP Intl Singapore | 272.50 | 308.50 | China, Middle East, Malaysia, Indonesia, Ukraine, Russia |
| Helm | 279.45 | 309.45 | China |
| Wilson Int’l | 285.80 | 321.80 | China, Middle East, Malaysia, Indonesia, Iran, Vietnam |
In the meantime, the Bangladesh Cabinet Committee on Government Purchase, led by Finance Minister A.M.A. Muhith, has approved the import of 300,000 mt of urea at a cost of Tk 6.07 billion (US$ 86.71 million), targeting to meet the mounting demand. It decided on Aug. 24 to import some 150,000 mt of prill and 150,000 mt of granular.
Bangladesh’s local supply of urea is likely to improve following the return of two gas-run fertilizer factories – Polash Urea Fertiliser Factory and Chittagong Urea Fertiliser Ltd (CUFL). They were closed earlier this year to ensure an uninterrupted supply of gas to power plants. They are expected to resume production in September.
Polash and CUFL were closed down on March 16 and April 24, respectively. Also, Ghorasal Urea Fertiliser Factory, which was shut down on Aug. 12, 2007, after a fire, resumed production after over two years this week. The Jamuna Fertiliser Company Limited, which was closed down following a mechanical problem, has also returned to production.
NITROGEN SOLUTIONS
U.S. Gulf: Barge prices are put within the $135-$140/st FOB ($4.22-$4.38/unit) range. While many sellers are quoting $140/st and above, others argue that inland prices do not justify higher numbers.
As of Aug. 27, DH indicated the paper market was $137-$140/st for September and $135-$145/st for October-December. First quarter 2010 was $145-$150/st FOB.
Eastern Cornbelt: There was some interest in UAN in late August both at the wholesale and retail levels, sources said. One put the rail-delivered range for UAN-32 in the region at $180-$190/st ($5.63-$5.94/unit) from the Gulf, while most others put the terminal price to the dealer in roughly the same range. Forward contract tons for September shipment were being offered in the $182.40-$200/st ($5.70-$6.26/unit) FOB range, while forward contract pricing for October through December was quoted in the $5.80-$6.30/unit FOB range, depending on location.
Western Cornbelt: The UAN-32 cash market was pegged at $175-$190/st ($5.47-$5.94/unit) FOB regional terminals, depending on location, with the upper end reported in Missouri. One source quoted rail-delivered UAN-32 at the $175/st ($5.47/unit) level as well from southern production points.
Northern Plains: The UAN-28 market was quoted at $169.40/st ($6.05/unit) FOB Winona, Minn., and $185-$200/st ($6.61-$7.14/unit) DEL in North Dakota. Forward contract UAN-32 FOB Pine Bend was reportedly being offered at $6.00/unit for September, $6.05/unit for October, $6.10/unit for November, and $6.15/unit FOB for December.
Great Lakes: The UAN market was pegged at $5.75-$6.43/unit FOB regional terminals, with the upper end reported for UAN-28 in Michigan. Dealer reference levels remained as high as $185/st ($6.61/unit) FOB on a spot basis in Michigan.
Northeast: Sources pegged the UAN-30 market at $165-$175/st ($5.50-$5.83/unit) FOB Baltimore, Md., with the upper half of the range reflecting the more common price to the dealer. Sources quoted UAN-32 at $174.40/st ($5.45/unit) FOB Chesapeake, Va., and at the $196/st ($6.13/unit) FOB level out of terminals in upstate New York. One source also reported delivered UAN-32 at $200-$205/st ($6.25-$6.41/unit) in New York.
AMMONIUM NITRATE
U.S.Gulf: Sources continue to call the market $200-$210/st FOB. As of Aug. 27, DH reported the paper market in this same range from September-December.
Western Cornbelt: Ammonium nitrate was tagged at $242-$265/st FOB, with the low reported for truck tons in Missouri on a spot basis.
AMMONIUM SULFATE
Eastern Cornbelt: Granular ammonium sulfate remained at $160-$180/st FOB to the dealer.
Western Cornbelt: Granular ammonium sulfate remained at $160-$180/st FOB, with limited inventories.
Northern Plains: Minnesota sources quoted the granular ammonium sulfate market at $160/st FOB, while delivered sulfate was pegged at the $225/st mark in North Dakota.
Great Lakes: Granular ammonium sulfate pricing covered a broad range in the region, with the low reported by Wisconsin sources at the $160/st FOB level and the upper end pegged at $245/st FOB in Michigan to the dealer.
Northeast: Granular ammonium sulfate pricing had reportedly dropped to $158/st FOB Hopewell, Va., with delivered tons quoted at $175-$178/st to points in Delaware and Pennsylvania.
PHOSPHATES
Central Florida: The good news was no hurricanes – major or otherwise – have hit Florida so far this season, and it was about half over last week. The bad news was business was so slow it made no difference. Despite the lack of new prompt business, inventories remained relatively low, but that was primarily due to a strong export schedule.
A trader pointed out that the lack of railcar sales was due not to price, which has often been the case, but to a lack of interest. Before dealers begin reordering they want to see some empty space in their storage bins, but farmers were not creating a run on existing supplies – yet. That may happen within the next couple of weeks. If it does, logistics would soon become a problem, because only so many railcars will be available.
The few new prompt sales that happened during the last reporting period were done the previous Friday, and prices were in the same exact range. Although large buyers can get the lowest prices from producers on a regular basis, small buyers normally have to go through a reseller. However, as of late last week, the price was about the same from either source.
The Central Florida DAP price range continued to be flat last week – $275/st FOB – based on actual sales. However, small buyers may have to pay a premium once traders unload what they have on hand. Both Mosaic and PCS Sales had a $10/st FOB additional charge for MAP. Agrifos was no longer posting rail prices, but its price for truckloads was $300/st FOB for DAP and $310/st FOB for MAP.
As of Aug. 27, DH reported the paper market at $265-$280/st September-December.
U.S. Gulf: NOLA DAP barges available last week for prompt delivery were scarce. CF had nothing left for August and probably not much more for September. Mosaic was short on inventory and set its price well above the market, and Agrifos was using its production to load a vessel for Latin American export. The few possible for sale were coming from Miss Phos, which may become the primary supplier for at least the next few weeks.
Not that demand was overwhelming, though. Producers and traders both said dealers were not ready to buy because farmers have not been letting them know what they will want, so dealers would like to see their bins near empty before they start reordering. Most, though, believe demand will increase sometime in September. For those in the upriver areas, deals will have to be done by around the middle of next month in order to arrive before the river closes, which is normally around mid-October.
DAP was moving out of terminals in Oklahoma, as farmers were harvesting their wheat crops and getting ready for planting. However, phosphate supplies were running low – and may run out – because the U.S. Army Corps of Engineers closed locks numbers 17 and 18 for maintenance, so barges will be delayed until the Arkansas River reopens on Sept. 6.
Late last week, corn prices for December had fallen to about $3.25/bushel, but that price should still be high enough to keep farmers in the fertilizer market. However, the price of phosphate barges has continued to creep upward, and warehouse prices will soon have to follow. Last week, terminals were charging between $305/st FOB and $315/st FOB, which meant sellers would have to take a slight loss if they continue to remain competitive.
The NOLA DAP barge price range moved up last week, from $277-$283/st FOB to $280-$284/st FOB, but virtually all sales were made very early in the last reporting period. Asking prices late last week were around $285/st FOB. Indications were prices would continue to rise, possibly as high as $300/st FOB by the end of the season. Both Mosaic and CF were charging a $10/st FOB premium for MAP.
As of Aug. 27, DH had the September paper market at $285-$290/st, with $288-$292/st for October, $290-$295/st November, and $295-$300/st December.
Eastern Cornbelt: DAP pricing was up slightly from last report. Sources quoted the dealer market at $310-$330/st FOB, with the upper end on a spot basis in Ohio. One supplier was referencing forward contract tons for September at $320/st FOB Peoria, Ill., and $325/st FOB Cincinnati, with a $5/st increase for October-November shipments.
MAP was $10/st higher than DAP. 10-34-0 was quoted at $315-$330/st FOB in the region.
Western Cornbelt: DAP was quoted at $310-$320/st FOB warehouses to the dealer, up slightly from last report, with MAP $10/st higher than DAP. Forward contract DAP tons for September were referenced by one regional supplier at $320/st FOB St. Louis, with a $5/st increase for October through November.
10-34-0 was steady at $310-$330/st FOB in the region. Effective Sept. 1, Agrium’s postings for super phosphoric acid (SPA) and merchant grade acid (MGA) will move to $670/st rail-DEL in Colorado, Iowa, Kansas, Nebraska, New Mexico, Oklahoma, Texas, and Wyoming.
Northern Plains: DAP was quoted at $320-$325/st FOB the Twin Cities, with MAP $10/st higher. Forward contract DAP FOB Pine Bend was referenced at $325/st for September, moving to $330/st for October and November shipments. Delivered MAP in North Dakota was pegged at the $360/st mark last week.
10-34-0 was pegged at $315-$330/st FOB, with delivered 10-34-0 in North Dakota quoted at $380-$385/st. Effective Sept. 1, Agrium’s postings for SPA and MGA will move to $670/st rail-DEL in Minnesota and the Dakotas.
Great Lakes: The spot market for DAP was pegged at $310-$335/st FOB in the Great Lakes region, with the upper end reported in Michigan to the dealer. MAP was $10/st higher than DAP. 10-34-0 was pegged at $325-$330/st FOB in the region, though one source speculated that he’d have to drop to $315/st FOB to get any business. A Wisconsin source reported the same range of $325-$330/st being offered for spring 2010 prepay tons.
Northeast: MAP was quoted at $325-$345/st FOB in the region, with the low in western Pennsylvania. DAP was $10/st less than MAP. 10-34-0 pricing had dropped to $320/st FOB the tank in upstate New York, with other sources quoting a $340/st DEL level in the New England market.
U.S. Export: The only export activity found last week in this country was a deal by KeyTrade using CF product – 20,000 mt of DAP and 5,000 mt of MAP – to Peru. The DAP FOB price was said to be about $315/mt FOB, according to a source. In addition, Agrifos was loading a vessel with about 25,000 mt for shipment to Latin America at market prices, and will be loading another of similar size in September.
The most promising markets in the next few weeks were expected to be Pakistan, Africa, and Argentina. India was said to actually need additional supplies, but buyers were watching to see if rain would be sufficient before making another move.
The export DAP price range last week changed from $313-$325/mt FOB to $315-$320/mt FOB, based on recent transactions. The export price has been running ahead of domestic markets, but appeared to be slowing just a bit.
As of Aug. 27, DH reported the paper market as $320-$330/mt for September and $330-$340/mt October-December.
POTASH
U.S. Gulf: The barge market was called $455-$460/st FOB.
Eastern Cornbelt: The regional potash market remained at $510-$520/st FOB warehouses and $520-$530/st railDEL from North American producers, but Illinois sources quoted Russian tons out of spot river locations for as low as $475-$480/st FOB last week. An Ohio source also talked of imported tons at sub-$500/st levels on a delivered basis in late August.
Western Cornbelt: The regional potash market remained at $510-$520/st FOB and $520-$530/st rail-delivered, depending on location and supplier.
Northern Plains: Potash remained at $467-$480/st FOB Saskatchewan mines to U.S. customers, depending on grade. Delivered potash was quoted at $530-$550/st in the region, depending on grade and location.
Great Lakes: Michigan sources tagged the potash market at $510-$517/st FOB the warehouse, with the low for red and the upper end for white granular product. There were reports of Russian potash trading at sub-$500/st levels on a delivered and FOB basis, however, with one Wisconsin source quoting spot river warehouse tons as low as $475-$480/st FOB last week.
Northeast: Sources quoted the potash market at $510-$535/st FOB and $520-$550/st DEL in the region, depending on grade, location, and supplier. One Pennsylvania source put the dealer market at the $530/st FOB level last week, while a Delaware contact quoted a $540/st DEL market.
Russia: The Federal Anti-Monopoly Service has begun a probe of domestic potash pricing by producers Uralkali and Silvinit, according to The Moscow Times. Earlier this month, Russian NPK makers reportedly cut back or stopped production because of a lack of potash due to a price dispute with producers. Among them, Acron and UralChem reportedly asked the government to put quotas on the amount of potash that could be exported.
SULFUR
Tampa: As a result of a few refinery problems, refineries producing less fuel than anticipated, and the greater use of sweet rather than sour crude oil, sulfur supplies have slowed somewhat during the past couple of weeks. For a glutted market, that was not a bad thing.
Meanwhile, Mosaic was continuing to melt sulfur it has stored at Galveston and will continue to do so through September – at least. By that time, the company expected to have enough room to handle some additional supplies, and still have enough if an interruption should occur.
On the world market, sulfur was becoming more of a problem. China was said to have about twice as much as it normally stores, and may soon pull back from the market.
The idea of storing excess sulfur in salt domes in the Gulf was being considered again.
Prill operations along the Gulf Coast were humming along at a constant rate, and shipments to overseas customers were continuing. Last week, spot prill prices were in the range of $15-$18/mt FOB.
Vancouver: China was said to have between 2 million and 3 million mt of sulfur stored at warehouses at its ports and may soon pull back from the market, which would not be good news for suppliers out of Vancouver.
MARKET NOTES
Pakistan: The country’s only DAP plant, Fauji Fertilizer Bin Qasim Ltd. (FFBL), has announced its half-year result for the period ended June 30, 2009. It posted a profit after tax (PAT) of PKR 491 million (US$ 5.98 million) during the first half, versus a year-ago PKR 718 million. The decrease was attributed to an end in subsidies on feedstock gas due to the completion of a ten-year gas subsidy period, higher financial charges originating from higher working capital requirements, and losses incurred in joint venture operations. On the volumetric front, urea sales volumes remained depressed at 281,000 mt during the first half, versus the year ago 359,000 mt. DAP sales jumped to 279,000 mt, versus the year-ago 36,000 mt.