All Posts from September 22, 2014

CHS, Ag Plus form jv for new liquid terminal

Featured, News

CHS Inc., St. Paul, and Ag Plus LP, South Whitley, Ind., have formed a 50-50 joint venture company to construct and operate a liquid fertilizer facility near Columbia City, Ind. The facility will have 3 million gallons of liquid storage and 130,000 gallons of chemical storage. It will primarily serve farmer-owners of Ag Plus LP retail business. CHS will also serve its nearby wholesale customers from this location.

“Farmers are increasingly looking for ways to maximize their time and input costs, and liquid fertilizer application lets them apply nutrients at planting, saving time and trips across the field, getting their crops off to a good start,” said Jeff Mize, Ag Plus CEO. “Our new, larger and more efficient facility will give area growers better overall fertilizer service and options.”

The facility will offer 24-hour load-out of UAN and 10-34-0 fertilizers, and will allow Ag Plus to more than double its load out capacity.

“CHS is focused on expanding its crop nutrients business to continue to provide its retail customers with an assured, timely supply of crop nutrients vital to profitable crop production,” said Cheryl Schmura, CHS Crop Nutrients, vice president, marketing and sales. “Our partnership with Ag Plus adds critical storage capacity in a key geography.”

PotashCorp eyes increased 2015 production

News, News Briefs

Saskatoon — Potash Corp. of Saskatchewan Inc. CFO Wayne Brownlee, speaking at the Credit Suisse Basic Materials Conference Sept. 17, said the company is looking at producing 10.5-11 million mt of potash in 2015, up from 2014’s operational capability of 9.2 million mt. Brownlee cited better-than-expected demand and supply constraints at competitors. As previously reported, he noted that PotashCorp is in the process of recalling workers. “It doesn’t cost a lot to do it, but the cost of losing 500,000 mt of sales is substantial, relative to the cost possibility.” Brownlee said the Rocanville mine expansion is expected to come up in 2015, and the company expects to run that mine full-out as it will have the lowest cost in the PotashCorp profile, close to $70/mt. Globally, PotashCorp projects potash shipments at 58-59 million in 2014, which it thinks is also likely again in 2015. It expects offshore shipments to be up, but that U.S. market might be off slightly, in sympathy with crop prices.

The Week in Fertilizer Stocks

Fertilizer Stocks

The Week in Fertilizer Stocks


Producer Symbol Price Week Ago Year Ago
Agrium AGU 93.49 90.99 91.97
CF Industries CF 259.71 250.77 207.00
CVR Partners UAN 14.76 15.21 18.66
Intrepid Potash IPI 16.57 15.34 17.00
Mosaic MOS 46.73 46.16 45.13
PotashCorp POT 35.38 33.69 32.43
Rentech Nitrogen RNF 13.41 14.14 25.70
Terra Nitrogen TNH 142.49 144.90 203.80
Distribution/Retail
Andersons Inc. ANDE 65.71 67.15 70.12
Deere & Co. DE 84.15 82.08 84.51
Scotts SMG 56.12 56.33 55.66

Ammonia

Ammonia, Black Sea, Eastern Cornbelt, Great Lakes, India, Market Watch, Middle East, Northern Plains, Tampa, U.S. Gulf, Western Cornbelt

U.S. Gulf/Tampa: The Tampa price for October closed late in the week at $640/mt CFR, up $70/mt from September’s $570/mt. Sources had already noted that higher international prices would likely mean a boost for Tampa.

U.S. July ammonia imports were 521,949 st, almost level with the year-ago 523,957 st, according to the U.S. Department of Commerce.

October NYMEX natural gas settled Sept. 18 at $3.910/mmBtu, up from Sept. 11’s $3.823/mmBtu.

Eastern Cornbelt: The ammonia market had reportedly inched up to $655-$670/st FOB in the Eastern Cornbelt, depending on location. Sources pegged the common market out of Illinois terminals at $665-$670/st FOB last week.

Sources remained concerned about available fertilizer supply for the region’s fall application season. “I don’t think the system has been tested yet, although I fully expect problems,” said one contact.

Western Cornbelt: Anhydrous ammonia was quoted at $630-$660/st FOB regional terminals in the Western Cornbelt, with the low in Nebraska and the upper end FOB Palmyra, Mo. Delivered ammonia remained in the $670-$690/st range in Missouri, depending on point of origin.

Northern Plains: Sources pegged the anhydrous ammonia market at $630-$635/st FOB regional terminals in the Northern Plains, with the upper end reported out of the Velva, N.D., market for fall prepay. Delivered ammonia in the North Dakota market was pegged at the $630/st level for fall prepay or fill tons. Agrium’s anhydrous ammonia posting FOB Mankato, Minn., firmed on Aug. 28 to $655/st.

Expected harvest delays in the region, coupled with slow crop maturation, had some sources tempering their expectations for the fall fertilizer season. “Fall looks to be somewhat small depending on how the row crops come off,” said one North Dakota contact. “We could see some fertilizer application, but at this point there’s not too much talk.”

Great Lakes: Anhydrous ammonia pricing in the Great Lakes region had reportedly firmed to $655-$675/st FOB regional terminals, with the low quoted by Michigan sources FOB Huntington, Ind., and the upper end FOB Courtright, Ont. Wisconsin sources pegged the dealer market at the $665/st FOB mark.

Black Sea: Prices are on the move. Sources now say the price is approaching $530/mt FOB and trending upward.

Even as the price moves up, however, sources say overall the area market is quiet. The price increase appears to be related to limited supply rather than additional demand.

Middle East: September has been a month of rapid movement on prices.

The month started off with a deal reported around $550/mt FOB. By the middle of the month, $580/mt FOB was reported. Additional deals at the $580/mt FOB level were reported as Green Markets went to press, with one source even relaying rumors that $600/mt FOB might have been done.

One trader noted that the current Asian price does not support these higher prices. In the past, Mitsui has been willing to pay higher-than-usual prices to ensure its contracts are fulfilled. At first, some in Asia wrote off the initial purchase as a one-off arrangement just to satisfy a contract. The subsequent deals, however, may indicate a longer-term trend for higher prices.

India: FACT called a tender for 120,000 mt of ammonia to be delivered over a six-month period. The tender closes Sept. 22.

Delivery of the material is to be to the FACT Cochin facility. Each cargo cannot be more than 7,500 mt per month because of the limited storage capabilities at the port. The fact that FACT wants about 20,000 mt each month indicates that it may be able to

Urea

China, Eastern Cornbelt, Great Lakes, India, Indonesia, Market Watch, Middle East, Northeast, Northern Plains, U.S. Gulf, Urea, Western Cornbelt

U.S. Gulf: Granular barges were reported to have started the week as high as $355/st FOB, but fell off to as low as $327/st FOB for prompt. Both ends were the extremes, with most players putting the market in the $330s/st FOB. Chinese product was reported to have traded in the $317-$325/st FOB range.

Prills saw some erosion, and were now called $340-$345/st FOB.

Urea imports were up 91 percent in July, to 276,977 st from the year-ago 144,767 st.

Eastern Cornbelt: Sources pegged the granular urea market at $385-$410/st FOB in the Eastern Cornbelt, down another $10-$20/st from last report, with the low reported out of spot Illinoi River terminals. The Cincinnati, Ohio, market was quoted at the $395/st FOB level.

Reference prices reportedly remained as high as $455/st FOB at some inland locations in Ohio, but sources reported no new sales at that level.

Western Cornbelt: Granular urea had reportedly slipped to $390-$400/st FOB most regional terminals in the Western Cornbelt.

Northern Plains: The granular urea market remained at $380-$390/st FOB the Twin Cities, with delivered tons pegged at the $425-$430/st mark in North Dakota.

Effective Sept. 2, Agrium’s granular urea postings moved to $425/st FOB North Dakota terminals at Alton, Colfax, Scranton, and Carrington; $425/st FOB Marion, S.D.; and $430/st DEL in Minnesota and the Dakotas. Those levels were up $15/st from Agrium’s July 1 postings in those locations.

Great Lakes: Granular urea was pegged at $405-$425/st FOB in the Great Lakes region, with the low quoted by regional sources out of the Burns Harbor, Ind., market. Agrium’s granular urea posting in Wisconsin moved to $430/st DEL on Sept. 2, up $15/st from the July 1 reference price.

Dealers were struggling to secure shipments of replacement tons, while regional growers were seeding alfalfa and planting winter wheat. “The bins are still not full, but we’re working on it,” said one source. “Supply is very thin,” added another. “Some terminals are just starting to get some DAP and urea in. Potash is nonexistent, unless you get it off the Illinois and Ohio rivers.”

Northeast: Granular urea was pegged at $415-$425/st FOB Fairless, Penn., up $5/st from last report, with the low end also quoted out of the East Liverpool, Ohio, market. Delivered urea was quoted at the $445/st level to points in southern Pennsylvania.

India: The MMTC tender closed with close to 2.3 million mt offered. Prices reflect higher netbacks for producers than the July IPL tender, but still not as much as producers had hoped for. Sources peg the netback for the bulk of the offers back to China at $288-$295/mt FOB. Producers had been arguing for $300/mt FOB for the past few weeks.

The fly in the ointment for MMTC is the Berrychem offer. The company offered 68,000 mt at $302.77/mt CFR into Krishnapatnam or Gangavaram, about $6/mt lower than the main body of offers.

At first traders were concerned that MMTC would be locked into requiring the other offering firms to match the Berrychem offer or walk away. However, a more careful reading of the tender documents, including the four addenda, showed that MMTC could make other arrangements for pricing based on individual ports. It also could ignore the Berrychem offer if it desired.

Rejecting a low price would be politically difficult, said one trader. As the industry was still digesting what all the numbers meant, a consensus was growing that MMTC would have to set prices for each port and ask the traders to match those prices.

In the end, coming up with a series of prices for each discharge port is what MMTC did. Below are the c

Nitrogen Solutions

Eastern Cornbelt, Great Lakes, Market Watch, Northeast, Northern Plains, U.S. Gulf, UAN, Western Cornbelt

U.S. Gulf: The market remains hard to peg, with most sources noting that very little product is actually sold in a prompt window. While some report prompt business at $237/st ($7.41/unit) FOB, others say trades for product that can ship anytime between now and the end of the year have gone at higher numbers in the $240-$250/st ($7.50-$7.81/unit) FOB range.

UAN imports were up 62 percent in July, to 184,377 st from the year-ago 113,555 st.

Eastern Cornbelt: UAN-28 was unchanged at $255-$265/st ($9.11-$9.46/unit) FOB terminals in Ohio and Indiana, with the low reported in Cincinnati. Illinois sources quoted the UAN-32 market steady at $290-$300/st ($9.06-$9.38/unit) FOB.

Western Cornbelt: The UAN-32 market remained at $285-$300/st ($8.91-$9.38/unit) FOB terminals in the Western Cornbelt. An Iowa source pegged the common dealer market at the $295/st ($9.22/unit) FOB level in his trade area last week.

Northern Plains: The UAN-28 market was steady at $273/st ($9.75/unit) FOB the Twin Cities and $290-$295/st ($10.36-$10.54/unit) DEL in North Dakota, depending on location.

Great Lakes: Michigan sources quoted the UAN-28 market at $265-$270/st ($9.46-$9.64/unit) FOB, with the low out of Burns Harbor and the upper end FOB Webberville, Mich. Wisconsin sources pegged UAN-32 at $300-$312/st ($9.38-$9.75/unit) FOB, depending on location.

Northeast: UAN-32 pricing had reportedly inched up due to firming import vessel costs. Sources pegged the Baltimore, Md., market at $255-$260/st ($7.97-$8.13/unit) FOB for nearby shipment, up $5/st from last report, with November/December shipments likely to be another $5/st higher.

UAN-32 pricing out of terminals in upstate New York remained at $304/st ($9.50/unit) FOB for the last business.

Ammonium Sulfate

Ammonium Sulfate, Eastern Cornbelt, Great Lakes, Market Watch, Northeast, Northern Plains, Western Cornbelt

Eastern Cornbelt: The granular ammonium sulfate market had reportedly firmed to $290-$305/st FOB in the Eastern Cornbelt, with the low quoted in the Illinois market on a spot basis and the upper end in Ohio and Indiana. The dealer market FOB Maumee, Ohio, was pegged solidly at the $300/st level at mid-month.

Honeywell’s Sept. 12 postings in Illinois included granular at $300/st FOB and $310/st rail-DEL, and mid-grade at $265/st FOB and $275/st rail-DEL.

Ammonium thiosulfate was pegged at $350/st FOB in the region.

Western Cornbelt: Granular ammonium sulfate was quoted at $290-$300/st FOB in the Western Cornbelt, with rail-DEL tons referenced at the $310/st level in the region.

The ammonium thiosulfate market was unchanged at $320-$345/st FOB.

Northern Plains: The granular ammonium sulfate market had reportedly firmed to $290/st FOB in Minnesota, up $10/st from last report. In North Dakota, delivered ammonium sulfate was pegged at $285-$295/st, with the low for prompt ship and the upper end for fall prepay.

Effective Sept. 12, Honeywell’s granular ammonium sulfate posting firmed to $300/st FOB Roseport, Minn., and $310/st rail-DEL in Minnesota, with mid-grade moving to $265/st FOB Roseport and $275/st rail-DEL in Minnesota. Those levels reflect a $20/st increase for granular from Honeywell’s Aug. 11 postings, and a $15/st increase for mid-grade.

Ammonium thiosulfate remained at a nominal $330-$340/st FOB in the Northern Plains for prompt pull, although North Dakota contacts reported that delivered fill tons could still be had on a spot basis for as low as $295/st from Canadian shipping points.

Great Lakes: Granular ammonium sulfate was $290-$305/st FOB in the Great Lakes region, up $20-$25/st from last report, with the low in Wisconsin and the upper end FOB Webberville and Burns Harbor.

Effective Sept. 12, Honeywell’s granular ammonium sulfate postings firmed to $300/st FOB Wisconsin terminals at Amherst Junction and Prairie du Chien, and $310/st rail-DEL in Wisconsin, with mid-grade referenced at $275/st rail-DEL in Wisconsin. Those levels reflect a $20/st increase for granular from Honeywell’s Aug. 11 postings, and a $15/st increase for mid-grade.

The ammonium thiosulfate market was pegged at a solid $350/st FOB in the region.

Northeast: Granular ammonium sulfate was quoted at $290-$305/st DEL in the Northeast, up $15-$20/st from last report, depending on location. The upper end of the range was also quoted on an FOB basis out of East Liverpool.

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