Central Florida: Producers, but not traders, said they had a big uptick in railcar business last week.
Traders, however, were looking to the river system – where prices were lower – to meet the needs of their customers, rather than their normal method of buying in Central Florida. Instead of using railcars to move the product they were buying, most were relying on trucks.
The markets continued to be out of whack last week, with NOLA DAP/MAP barges cheaper than railcars from Florida. Late in the week, the difference was growing rapidly, with Central Florida as much as $30/st FOB higher than the river price. Central Florida should be about $25/st FOB lower than the river system.
The Central Florida DAP price range leveled out last week to a flat $480/st FOB from the previous week’s $480-$500/st FOB range. Very large buyers may be able to get additional discounts, although that area was murky.
Both Mosaic and CF Industries were posted at the $480/st FOB mark. MAP was listed at a $20/st premium to DAP by Mosaic in Central Florida, about the same difference as from traders. MAP continued to be in short supply. PCS Sales was selling at comparable prices to the market.
U.S. Gulf: Some traders who took positions a few weeks ago when prices were extremely low decided late last week to liquidate what they had purchased. As a result, they were selling their NOLA DAP barges far below what the market was bringing only a day earlier.
Early in the reporting period, deals were done as high as $490/st FOB, which was the high of the previous week’s range. The market then drifted south a little, at least in comparison to the final prices during the period. On Thursday morning, they began to plunge. "The market is in a panic," one source said.
Reasons for the sudden drop may have included USDA’s crop report, which showed higher crop yields and production, and a slowdown in business earlier in the week. In addition, NOLA phosphate barges purchased a few weeks ago at low prices came on the market.
Prices began to rise the previous week due to cutbacks in production, first by Phoschem and then by OCP and Phosagro. India, which was experiencing a drop in the value of the rupee, was reducing the amount it was buying for import – and that sent ripples through the phosphate world. If the producers make good on the cutbacks, more than 500,000 mt would be pulled from the system during the first quarter of the year.
Mosaic earlier was buying low-priced barges, which had the effect of reducing supply. Mosaic was not the only one buying at the low end of the range at the time, when prices were as low as $425/st FOB. Late last week, with the market relatively quiet, some of the other buyers of those barges sold for as much as $40/st FOB below the high for the week.
The NOLA DAP barge price range was quoted at $450-$490/st FOB, with the lowest prices sales coming at the end of the reporting period. The market has yo-yoed from a $425-$450/st FOB range three weeks ago to $440-$490/st FOB the following week.
Eastern Cornbelt: The regional DAP market was pegged at $510-$525/st FOB, up some $15-$20/st from the prior week. The Cincinnati DAP market was quoted at the $520/st FOB mark at midweek, while MAP was reported at $545/st FOB. The 10-34-0 market was pegged at $740-$750/st FOB in the region for limited tons.
One Ohio contact said spreaders were rolling steadily on frozen ground early in the week, but activity was stalled by wintry weather as the week advanced. A powerful winter storm dumped up to eight inches of snow in northern Illinois, and more than a foot in parts of northern Indiana and northern Ohio on Jan. 12-13. Snow accumulation in east-central Illinois was expected to total two to four inches, while only light snowfa