Central Florida: Phosphate producers were said to have zero tons of MAP on offer in the Central Florida market, regardless of price, and resellers claimed they weren’t sure if any DAP was available either.
Irrespective of availability, sources said phosphates were currently a hard sell out of Florida, as rail rates to the Northeast made it difficult or impossible to compete with the price of NOLA material shipped from river terminals.
Truck-loaded DAP continued to command a premium over rail-loaded product.
The Central Florida DAP market continued to be quoted at $435-$440/st FOB, unchanged from recent weeks, with product shipped by truck believed to represent the top of the range. MAP, though essentially unavailable, was quoted $20/st FOB higher than DAP.
U.S. Gulf: Despite a general consensus among both traders and producers that the NOLA barge price was likely to experience a slow, steady climb in the weeks ahead, several sources noted a marked reluctance by a substantial segment of the market to go long.
“We’re still pushing it,” one seller said, “but people seem to be a little afraid of phosphates. Not sure why.” Added another source, “I wish I wasn’t so scared of phosphates, but I still haven’t bought in.”
Despite buyers’ hesitance to take the plunge, prices continued to creep northward in light trading. Overall volume remained down, and nowhere near levels many had hoped following the previous week’s Southwestern Fertilizer Conference. Most sources expected the market to pick up steam in the coming weeks, however.
Industry players almost universally pegged $445/st FOB as the current floor for domestic DAP, although a barge or two were believed to have traded as low as $442/st FOB. At least one barge sold for $448/st FOB by midweek, and many saw the market pushing close to $450/st FOB as of July 31.
Chinese-sourced DAP was believed to have sold at $435/st FOB for the week, but some sources said offers for Chinese product were generally closer to the low $440s/st FOB and that the cheaper transactions were the result of a last-minute order cancellation, with a seller needing to unload the spurned product posthaste.
Quality concerns regarding Chinese phosphates were a non-issue, some believed, claiming the imported material would be dark in color and have good physical characteristics. Chemical analysis could prove to be an issue however. “Nitrogen could be low,” one source said.
Sources continued to keep an eye toward the Latin American markets, where continued price strength was believed to directly support domestic levels.
The Brazilian market in particular is a good barometer for offshore trends in general, sources said, and a dip for the week in CFR prices at that country were briefly taken to portend a potential pullback in NOLA levels. Traders decided, however, that the price blip was more likely a one-off event, possibly representing a hedge trade or a cargo of lesser-quality material.
Terminal and warehouse prices held firm as well, with sales occurring in a range of $475-$490/st FOB in the lower and mid-river markets, while $495/st FOB was reported at St. Paul. MAP was said to command an extra $20-$25/st FOB over DAP.
Sources lamented an unexpected run-up in barge freight rates in recent weeks, claiming tow rates to have doubled or worse to some destinations. Price jumps of $15-$30/st were reported, and barge tightness related to a number of factors was blamed.
Huge quantities of imported salt clogged barge queues and were the primary culprit, several sources said. Businesses and municipalities needing to replenish salt stocks after last year’s harsh winter were responsible for a large chunk of the current tightness.