The results of the MMTC urea tender that closed Nov. 14 showed a $20/mt decline in pricing from the previous tender. The drop was expected by industry sources. Just under 3.6 million tons were offered by 21 companies.
The lowest offers into the West Coast came from Ameropa at $333.73/mt CFR. Dreymoor has the lowest offers to the East Coast with a price of $335.19/mt CFR.
While the price is dramatically lower than the previous tender prices of $353-$356/mt CFR, it is still dramatically higher than the August tender when prices were $274-$278/mt CFR. The difference between the August tender and subsequent two tenders is the lack of Iranian urea.
The U.S. sanctions against Iran are seen as the main force behind the dramatic jump in urea prices. The sanctions have also left open questions about final payments for the cargoes shipped in August and September. Industry sources familiar with Indian-Iranian trade said payment for many of those cargoes has not yet been finalized.
Sources said some of the tons being offered in this most recent tender may be Iranian but processed through Chinese bonded warehouses to hide the country of origin.
Offers direct from Fertisul, Muntajat and Sabic showed the Arab Gulf producers desire to put prices firmly into the $330s/mt FOB, a move undermined by offers from Ameropa and others.