Central Florida: Everyone was waiting for the weather last week, and the betting was that it will be an early spring after the “winter that never was.” Before dealers start placing orders, however, they want to see some bare space at the bottom of their bins, and that will take a run of drier and warmer weather.
Florida was already well into its spring season, but most of that need was being met by trucks, not rail. Georgia was spreading lime, but had not yet begun to spread fertilizers to any great extent.
Railcars were being loaded in Central Florida for contracts and formula-based sales, but not on a prompt, spot basis.
The Central Florida DAP price softened slightly last week, moving from $460-$480/st FOB the previous week to $460-$470/st FOB. CF Industries was posted at the $465/st FOB mark, and Mosaic was ready to do business in the $460-$470/st FOB range, depending on quantity. CF was mostly sold out until late March or early April.
MAP remained in short supply, and was priced at a $20/st premium to DAP by Mosaic in Central Florida, about the same difference as from traders.
PCS Sales was selling at prices comparable to the market.
U.S. Gulf: For traders and producers, the big question last week was whether to sell now at a relatively low price, or hold and potentially get more in a couple of weeks.
All signs point to an early spring, but dealers were not about to start ordering because they still have a lot in their bins. Once that runs out – and it will – they will order, and it may happen all at the same time. That means logistics will be difficult, and prices will rise. Those with positions and NOLA phosphate barges will do well, especially if they are at the right locations.
The spurt of business that happened during the previous few weeks was essentially the result of companies lining up quantities for export deals. The export market in Latin America was on its way down, however, and that market looked less attractive last week.
Some areas of the country served by the river system – such as the Southern Plains and Texas – were beginning to see increased activity. Conditions there were not nearly as dry as they have been. More phosphate was going to wheat and row crops than for corn, where the big money is.
The Mississippi River should be fully operational within a week or even less, so NOLA barges will be able to make the trip all the way to Minnesota.
NOLA phosphate barge availability was a question last week. There were more than enough to meet the lack of demand last week, but whether there will be enough once the season kicks into gear was unclear. Mosaic was not sending phosphate across the Gulf and was not producing it at Donaldsonville. Much of Mississippi Phosphates’ production has been going to the export market through Transammonia, and CF Industries has a heavy export schedule through Keytrade. As the export market backs down, that situation may change.
Prices for corn futures were down a little last week compared to the previous week, falling from $5.685/bushel to $5.54/bushel for December 2012. The corn price for December 2013 was $5.4525/bushel, down from $5.597/bushel the previous reporting period. Soybeans for November 2012 increased slightly to $12.9275/bushel from $12.925/bushel the previous week, and beans for November 2013 retreated to $12.18/bushel from $12.24/bushel the previous week. Wheat for July 2012 fell to $6.45 from $6.805/bushel a week earlier, and wheat for July 2013 was listed at $7.04/bushel last week, a drop from $7.32/bushel a week earlier.
Based on transactions, the NOLA DAP barge price range for the week was $438-$443/st FOB, compared with the previous week’s range of $435-$447/st FOB. The market will probably meander for another couple of weeks before it