AMMONIA
AMMONIA
U.S. Gulf/Tampa: The NOLA and Tampa markets remained quiet last week at $420/st FOB and $450/mt DEL, respectively.
Ammonia imports were up 63 percent in January, according to the U.S. Department of Commerce (DOC), to 588,004 st from the year-ago 361,648 st. However, for the July-January period, they were still off 7 percent, to 3.73 million st from 4.01 million st.
Eastern Cornbelt: The ammonia market was steady at $415-$425/st FOB regional terminals in late February. CF’s cash market postings on March 10 included $415/st FOB Terra Haute, Ind., Seneca, Ill., and Peru, Ill., $420/st FOB Albany, Ill., and $425/st FOB Cowden and Kingston Mines, Ill., and Frankfort and Huntington, Ind. One source said prepay offers were still on the table at the $435/st FOB level in Illinois.
Western Cornbelt: Anhydrous ammonia was quoted at $375-$410/st FOB regional terminals, with the low in Nebraska and the upper numbers out of Missouri and Iowa terminals.
Although temperatures climbed to the 50s and 60s throughout the Midwest last week, field activities continued to be hampered by wet field conditions, rain, and melting snow. The precipitation and snowmelt, coupled with ice jams, prompted flood watches or warnings for many locations in the region.
Northern Plains: Delivered ammonia in North Dakota was pegged at $450-$485/st, depending on supplier and location. Out of terminals in the region, the ammonia market was quoted at $410-$425/st FOB. One source said it remains to be seen how wet field conditions will affect preplant ammonia movement in the region, especially given the region’s wet fall and surplus winter snowfall.
Middle East: Most producers in the area are oversold, say traders. Swaps and other deals are being made regularly to make sure contract buyers get their tons in a timely manner.
Demand from Asia is keeping the order books full and the price inching upward.
The problem for the producers is that it is only the lower end of the market at this time that is rising.
Iran has been on a selling spree lately, say sources. Cargoes have been sold to European trading houses Transammonia and Yara. Sources peg the highest price paid for these deals at $370/mt FOB.
The Arab producers have been arguing since early February for $400/mt FOB. One Asian source said if it were not for the Iranian tons, that level could have been achieved.
As the market now stands, say producers and traders, the Iranian business at $370/mt FOB represents the low end of the scale. Other deals, mostly contract tons, are coming in at $380-$390/mt FOB.
Sources say the Iranians are willing to take a lower netback than the rest of the Gulf for a couple of reasons.
Most ammonia buyers take their cargoes on a delivered basis. The Iranian loading port is further away than the Arab ports. As a result, the transportation time ?Çô and cost ?Çô is greater. The growing movement to impose sanctions on Iran because of its nuclear program is also limiting potential buyers, making placement of their tons more difficult.
As the week closed, sources pegged the market for the area at $370-$390/mt FOB.
Black Sea: Even as prices move up, Ukrainian producers are still hesitant to come back online. Sources say the combination of uncertainty about natural gas prices and a fear of putting too much ammonia back into the market are making the producers wary.
Sources report that if the Ukrainians come back in, the new tonnage could soften what seems to be a strengthening market. Sources report a deal at $390/mt FOB was closed last week, moving the price up $10/mt.
Sources could not point to an end user for the deal, but said the most likely buye