Central Florida: Business remained slow in Central Florida last week, although a tightening supply climate in the region contributed to increased prices.
Sources roundly pinned the DAP ceiling at $440/st FOB for truck-loaded material. Most believed railcars couldn’t be had below $430/st FOB, and scattered rumors of leftover $425/st FOB offers went unconfirmed.
Complicating matters, a number of industry sources said the region’s largest supplier was “tight” through April, and was unlikely to offer phosphates until the second quarter. The economics were simple, sources said. “Considering a DAP price of $440/st FOB (in Central Florida), there are better netbacks for export business,” said one. The Tampa export price hovered in the mid-to-upper $480s/mt FOB last week.
No appreciable dry phosphate application was currently underway in the Northeast or Midwest, one contact said. Some late-season application was reported in Florida, however, and the Sunshine State’s “big season” for phosphate purchases was just around the corner, with business generally ramping up on or around Feb. 1.
The price of DAP in Central Florida firmed to a range of $430-$440/st FOB, compared with $425-$435/st the previous week, with truck sales comprising the top of the range. MAP was expected to maintain a $20/st FOB premium over DAP in the region.
U.S. Gulf: Sources reported another slow week on the river. Prices narrowed from the already slim $440-$445/st FOB spread of a week earlier, with traders reporting a number of transactions around $442-443/st FOB NOLA. Nearby $440/st FOB offers were mentioned as well, though it was unknown whether business actually concluded at that level.
Most sources expressed the belief that the DAP market was essentially resting on the bottom. It would take a “substantial, unforeseen event” to significantly derail DAP heading into spring, said one contact.
The supply landscape was largely credited for the market’s price stability. “Barges are available if you want them,” one trader said, “but they’re not plentiful enough to bring the market down.”
While DAP supply was diminished, MAP was “plentiful.” The lack of demand, coupled with ample supply, conspired to sink MAP pricing to near-parity with DAP. Most sources reported concluded MAP transactions at no higher than $450/st FOB.
Imports remained a wildcard in the market. A PhosAgro vessel was the most widely discussed foreign cargo expected in the near term, but sources last week added an OCP vessel, expected for discharge in early February, to the conversation.
The 54,000 mt cargo will carry both MAP and DAP, sources reported, but will predominantly consist of the former. The vessel was rumored to be earmarked for distribution to PotashCorp customers and thus unlikely to be offered at NOLA, but the cargo’s ownership could not be confirmed.
Some also believed Chinese producers would increase offers into the U.S. market in 2015, given a new, more forgiving export tax structure from the country, as well as the U.S. dollar’s current strength.
However, the NOLA barge price would have to firm before the NOLA market becomes an attractive target for Chinese sellers, sources maintained, probably to a minimum $450/st FOB.
The DAP barge price tightened to a range of $442-$443/st FOB for the week, compared with $440-$445/st FOB the previous week. MAP was called $445-$450/st FOB.
Eastern Cornbelt: DAP was steady at $470-$480/st FOB regional warehouses, with MAP quoted in the $490-$500/st FOB range in the Eastern Cornbelt.
10-34-0 was firm at $540-$550/st FOB for limited tons in the region.
Agrium’s phos acid postings will