Central Florida: With inventories low, phosphate producers were in no mood to lower their price. That should make little difference, however, because the spring season in most of the country was over.
Apparently, producers were counting on the export market to carry them through for the next several months, and that will probably work.
While portions of the Midwest and Southern Plains were experiencing worsening drought conditions, the reverse was true for much of the East. Too much rain was a problem in portions of the Northeast last week, and Florida was also receiving abundant moisture. Much of the state got a substantial watering from Tropical Storm Beryl a week earlier. A Gulf disturbance brought another week of wet weather in early June, and more was in the forecast.
As producers became the primary source of DAP sales last week, the Central Florida DAP price range firmed to $480-$485/st FOB, up $5/st from the previous week. Both Mosaic and CF Industries were listed at the $480/st FOB mark.
MAP continued to sell at a $20/st premium to DAP in Central Florida, about the same difference as from traders. PCS Sales, which produces MAP at its White Springs facility in North Florida, was selling at prices comparable to the market.
U.S. Gulf: The shuttering of Miss Phos’ processing plant last week pushed up prices for NOLA DAP barges, and pressure will continue to build as long as the plant remains down.
OSHA issued the order closing the facility after a second explosion claimed the life of a second employee within a two-week period. Two other workers were hospitalized in the latest incident. A source said the cause of the blasts was not known.
OSHA did not say how long the facility would be closed, but did say the investigation could take up to six months to complete. The output from the processing plant is sold by Transammonia, and that company said there was enough product in Miss Phos’ warehouse to take care of its immediate needs. A delay of a month or more could pose problems in meeting its contractual obligations, however.
Trammo said very little of the output from Miss Phos had been going into the NOLA market, because most was being used for export, mainly to Latin America. The spring season was essentially over last week, or close enough to halt the market on the river system – at least until the Miss Phos event. The reality was that not a lot of phosphate was available, but no one needs it in the immediate future.
After the explosion, bids and offers moved up into the $505-$515/st FOB range, before settling down in the $500-$508/st FOB range. Any actual buying reportedly took place only at the lower end of the range, however.
A source said that if the plant remains down and CF Industries continues to focus on the export market and not the river system, DAP prices could rise by as much as $50/st FOB by the middle of July. Terminal prices were also on the rise last week, moving up into the $520-$535/st FOB range, which reflected higher NOLA DAP barge prices. MAP prices were running about $20/st FOB higher than DAP.
Meanwhile, dry conditions in key corn areas such as Iowa, Nebraska, and Illinois could reduce yields and push up crop prices, which had been down in recent weeks, although still high by historical standards.
Prices for 2012 corn futures were higher last week compared to the previous week, rising from $5.225/bushel to $5.35/bushel for December. The corn price for December 2013 was $5.40/bushel, increasing from $5.2825/bushel the previous reporting period. For November 2012, soybeans moved up to $13.39/bushel from $12.75/bushel the previous week, and soybeans for November 2013 increased to $12.10/bushel from $11.6275/bushel a week earlier. Wheat for July 2012 fell to $6.425/bushel from $6.4825/bushel the week before,