All Posts from July 28, 2008

Market Watch

AMMONIA

U.S. Gulf/Tampa: Ammonia prices at Tampa are up some $160/mt for August. PCS Sales was reported to have gotten the ball rolling by selling a 16,500 mt cargo to Yara for $745/mt DEL. The cargo is to arrive during the first half of the month on the Elversele. Later in the week, Tampa end users have come forward at that level as well.

In the meantime, across the Gulf, Koch was reported to have sold a NOLA barge cargo to PCS for delivery to Geismar at $700/st FOB.

Eastern Cornbelt: The anhydrous ammonia spot market was reported at $1,040-$1,050/st FOB Illinois terminals on the low end, with the upper end of the regional range reported at roughly $1,080-$1,100/st FOB shipping points in Indiana and Ohio. Reference levels were well above those figures, however.

Western Cornbelt: Spot anhydrous ammonia pricing remained at $1,000-$1,020/st FOB on the low end last week, with the $1,020/st figure also reported in Missouri for delivered ammonia from southern production points. Reference levels were up considerably from those numbers, but sources reported no sales to test the higher postings.

Effective July 25, Agrium’s anhydrous ammonia postings in the Leal, N.D., sales area firmed yet again to $1,360/st FOB and $1,380/st DEL. Those levels reflect a $45/st increase from July 16 postings, a $116/st increase from July 10 postings, $179/st higher than July 4 reference levels, and up a total of $241/st from Agrium’s July 1 ammonia postings in that sales area.

Southern Plains: Anhydrous ammonia was pegged at $940-$975/st FOB for cash market tons in the region, with the low out of production points and the upper end FOB pipeline terminals. Agrium’s July 7 ammonia postings included $940/st FOB Borger, Texas; $960/st FOB Mocane, Okla.; $965/st FOB Conway, Kan.; and $970/st FOB Clay Center, Kan.

South Central: The anhydrous ammonia market was quoted at $850-$920/st FOB regional terminals for cash market tons, with the low FOB Memphis, Tenn.

California: Effective July 25, Agrium’s anhydrous ammonia postings firmed to 1,000/st truck-DEL in central California and $1,005/st truck-DEL in northern California. The company had previously released an updated price list showing a move to $980/st truck-DEL in central California and $985/st truck-DEL in northern California on July 25, but followed that shortly thereafter with the higher reference levels.

Pacific Northwest: Agrium announced yet another pricing increase for anhydrous ammonia. Effective July 25, anhydrous postings from the company firmed to $1,433/st rail-DEL in Oregon, Washington, Idaho, and Utah; $1,453/st truck-DEL in northern Idaho and in Oregon and Washington east of the Cascades; and $1,458/st truck-DEL in Montana and northern Wyoming. Those levels reflect a $54/st increase from the company’s July 16 postings, a $125/st increase from July 10 reference levels, a $187/st increase from July 4 postings, and a $250/st increase from Agrium’s July 1 ammonia postings in the region.

Agrium also announced another aqua ammonia pricing increase on July 25. Postings moved on that date to $363/st FOB Central Ferry and Finley, Wash., up $13/st from the company’s July 15 postings, $31/st higher than the July 10 reference levels, $46/st higher than July 4 postings, and up $77/st from Agrium’s July 1 aqua ammonia postings in the region.

Black Sea: Problems with at least one production facility continue to plague the supply train in Yuzhnyy. Sources report the storage tanks, which can hold about 120,000 mt of ammonia, are still dry – or nearly so. The continued shortage of tons in the area is pushing prices ever higher.

Sources report that after successfully securing a deal at $650/mt FOB a couple of weeks ago, the producers are now telling potential buyers that any August or September tons will cost almost $800/mt FOB.

Asian observers quickly point out that no deals have been done past the current level of $660/mt FOB as of late last week. That said, one trader commented that the end of July should see prices come closer to $700/mt FOB. September quantities just might make it to $800/mt FOB if the current demand stabilizes and if shortfalls in production keep popping up around the globe.

Sources say the current price is $640-$660/mt FOB.

Middle East: Indian buyers are said to be taking all the tons their contracts require, and this seems to make them happy. It seems that a tight situation in Southeast and Eastern Asian have buyers knocking on a number of doors in the Arab Gulf looking for whatever tons are available.

The Indian contracts keep netting back to the mid-$500s/mt FOB. This is significantly lower than the last done bit of spot business at $650/mt FOB.

While producers are talking about $700/mt FOB, end users, traders, and producers agree that there have been no spot deals in the past couple of weeks to establish a solid indicator of prices from the region.

One trader was adamant that the producers can ask all they want, but until a solid deal is concluded the indicated price will remain at $650/mt FOB. One producer did not dispute that line of thinking, but added eventually the price will come up because Yuzhnyy is up and global demand remains strong.

UREA

U.S. Gulf: Granular barges lost their steam last week after a big run-up during the Southwestern Fertilizer Conference. Sources said that buyers were scarce at $825/st FOB. In addition, others explained that profit taking was a major factor; that those that bought on the way up could now stand back and sell at a significant profit, and not endure any future risk. While some said the week started off at $825/st FOB, others said it soon started to sputter. Sources reported deals as low as $805/st FOB, with some expecting prices to fall below $800/st FOB.

Some sellers argued that any weakness was only temporary, and that once the profit taking works its way out of the market, that prices would firm. They also noted that NOLA’s status as a premium market to the world was also temporary, and that the huge demand for product overseas has quickly moved up international benchmarks. As a result, NOLA may be back once again to only expecting regular milk run cargoes from importers, with all the extra cargoes reserved for higher priced markets.

Eastern Cornbelt: Granular urea was tagged at $850-$880/st FOB regional terminals to the dealer, reflecting another increase from the prior week.

Western Cornbelt: The granular urea market was quoted at $840-$860/st FOB regional terminals to the dealer, with the low end reported early in the week and the higher number reported at numerous locations as the week advanced.

Agrium’s granular urea postings firmed on July 25 to $875/st FOB North Dakota warehouses at Alton, Carrington, Colfax, Marion, and Scranton, and $880/st rail-DEL in Minnesota, Wisconsin, and the Dakotas. Those levels reflect a $30/st increase from Agrium’s July 16 reference levels, a $70/st increase from July 10 postings, a $105/st increase from July 4 reference levels, and a $140/st increase from the company’s July 1 urea postings in those locations.

Southern Plains: Sources quoted the granular urea market at $835-$860/st FOB regional terminals to the dealer, with the low end reflecting Koch’s July 17 reference price at Enid, Okla. Several said they expected pricing to firm to the upper end of that range in the near term to reflect continually higher replacement costs.

South Central: Granular urea was quoted at $800-$850/st FOB regional warehouses, with the low at Vicksburg, Miss., but sources said additional increases are imminent as the terminal price catches up to current replacement costs.

Southeast: Urea prices were moving up quickly in the region. Sources tagged the market at $840-$850/st FOB port terminals last week, with the upper end reported as a firm dealer price FOB Wilmington, N.C. There were also reports of some suppliers referencing urea as high as $895/st FOB in the region, though no new business was confirmed at that level.

California: Effective July 25, Agrium’s urea pricing was slated to firm again to $895/st FOB West Sacramento, $920/st truck-DEL in central California, and $925/st truck-DEL in northern California. Those levels reflected a $30/st increase from Agrium’s July 16 urea postings in the state, a $70/st increase from July 10 reference levels, a $105/st increase from July 4 postings, and a $140/st increase from Agrium’s July 1 urea postings in California.

Pacific Northwest: Effective July 25, Agrium’s urea postings firmed for the fifth time in July, moving to $875-$890/st DEL in Montana and Wyoming; $900/st FOB Washington warehouses at Glade, Kennewick, Warden, and Wilson; $905/st DEL in Washington, Oregon, Idaho, and northern Nevada; $915/st DEL in northern and central Utah; and $920/st DEL in southern Utah. Those levels were up $30/st from Agrium’s July 16 postings, $70/st higher than July 10 reference prices, $105/st higher than July 4 postings, and $140/st higher than Agrium’s July 1 urea postings in the region.

India: It was almost anti-climatic. The IPL tender closed July 19, and before any of the validity dates could be reached, deals were sealed.

For a bulk of the tender, the deals were predetermined. A number of companies settled deals with IPL before the tender was called. All it took was for the tender to be called to validate the prices negotiated.

The pre-tender talks reportedly involved nothing but Black Sea material. Transammonia, Keytrade, and Helm had settled deals earlier. Reportedly, Ameropa was also part of that initial crowd.

When the final numbers came in for the tender, these four companies, plus Liven and three Middle East suppliers, were named winners.

IPL initial tender offers July 2008 are as follows.

Source: Industry sources

The Liven material from Indonesia was recently won in the PIM selling tender. Sources expected Liven to use those tons for this tender.

PIC/Kuwait sent its regrets.

According to sources, late last week the Middle East suppliers agreed to lower their prices to $815/mt FOB. The other sellers remained firm in their prices.

The high prices offered by Gavilon and EFC were put off by observers as signs that the companies wanted to remain in the India selling game, but that they are currently comfortable enough with booked business that they did not have to chase after the IPL tender.

One trader commented that if the current trend continues, the two sets of offers may look pretty good in another couple of weeks.

The big question for IPL is how many of the companies will exercise their options to sell additional tons to the Indians. Sabic has already indicated it will not.

Without the options, IPL is slated to take 325,000 mt in the next 10 weeks.

The big question now is: Will this be enough?

Some in the industry think the tonnage will be enough to hold off complaints from farmers until the fourth quarter. By then, some think, the export duty on Chinese urea will be lowered, which will make the product competitive once again in the global market.

Still to come are purchases by MMTC. Industry watchers are convinced by the resulting jump in global prices because of the IPL tender that MMTC will have to pay significantly more.

And therein lies the problem. As the price of imported urea goes up, so does the amount the central government will have to pay in subsidies. Already, sources say, the government is paying significantly more than anticipated for this year’s purchases. Additional buying at even higher prices could cause further financial woes for the treasury.

Black Sea: The estimated netback for the Yuzhnyy material used in the IPL tender is pegged at $735-$795/mt FOB. Sources say the wide range of prices is largely due to when the tons were contracted by the trading houses. As the year progressed, the cost of urea kept going up.

Sources reported last month that when the pre-tender deals were being finalized, the price was in the upper $600s/mt FOB.

Reportedly, producers were trying to get out of the arrangements with the traders as the price kept moving up. In some cases, sources say, new prices had to be negotiated.

Romania is now reportedly asking $830/mt FOB for its exports. Observers noted the freight difference between Romania and Yuzhnyy could easily mean $800/mt FOB product in the northernmost port.

The wide gap in offers made in the IPL tender makes using the tender as a guideline for current market pricing chancy at best, said one source. Few believe there are any tons left under $790/mt FOB, with many now saying the market has firmly moved into the $820s/mt FOB.

As of the end of last week, the only deals that could be confirmed were those related to the IPL tender. As a result, sources are not yet ready to call the Yuzhnyy market over $800/mt FOB. This week may be a whole other story.

Middle East: Producers showed their aggressive nature in the IPL tender by calling for $830/mt FOB for prills or granular. They then showed their desire to remain a major supplier to India by dropping their price to $815/mt FOB across the board.

The move will accomplish several objectives, say sources. It ensured solid bookings for July and August. It anchored the price at a high level. It made clear that some producers are fully committed without Indian business. And it secured a steady place in the vital Indian market.

PIC/Kuwait did not participate in the tender. Sources say their granular exports are fully booked and the company has no need to chase after other deals.

Even as IPL was making awards, sources report a deal – probably by PIC – at $870/mt FOB. Industry observers figure the cargo was headed for the Americas. Whether it is North or South is unclear.

Asian traders report that PIC is not alone in thinking $870/mt FOB is the new market level. Sources say any discussion with a Mideast producer starts with an Arab Gulf equivalent price of $870/mt FOB.

Sources said that the high offer by EFC also showed that their order books are full enough to not need the Indian business. Sales to Europe and the Americas are brisk and plentiful.

The IPL tender set a new floor for prices, agree sources. What is the ceiling is up for debate.

The reports of $870/mt FOB material at the end of the week, argue some, show that is the new price. Others argue that deal
is a fluke – for now – and should not be counted. The Indian business, they say, set the high and low for the week.

One trader suggested that the $815/mt FOB is clearly the floor. Any higher price already on the record should be included. This observer is not sure the $870/mt FOB constitutes a new level just yet.

No matter the dispute on the ceiling, sources say it will not be long before $870/mt FOB for prills and granular looks pretty good.

Asia: Material drifting out of Vietnam is distorting the Asian market, say sources.

Chinese tons brought over by land and river into Vietnam are being offered in 3-6,000 mt lots to nearby buyers at levels almost $100/mt below the Chinese export price.

Sources say the offers can be this low because the material was not taxed as it left China, nor as it entered Vietnam.

Larger trading houses looked at trying to secure enough of the material to offer into India, say sources. However, the logistics of lining up several small cargoes and then de-bagging the material proved too much for many.

The urea is now being sold to Thailand, the Philippines, and other nearby countries in small, bagged lots. The buyers just wait until they need the tons and then seek out a seller. One trader equated the process to going to the grocery store for coffee and eggs.

Because the tons are sold at levels below international rates, the buyers are hostile to any offers made by traders or suppliers working with the going global rate. So sales are not being made into these smaller markets.

Sri Lanka reportedly has purchased more than enough for its needs.

Sources say the buyers stepped up just as the market was rising. Additional tons are most likely not needed at this time. One trader commented that even if more were needed, he doubted the Sri Lankan treasury could afford the price.

Bangladesh: BCIC plans to import 100,000 and has issued two tenders for 50,000 mt each for prilled and granular. Offers are due Aug. 11.

NITROGEN SOLUTIONS

U.S. Gulf: Unlike urea, there did not appear to be erosion in the UAN barge price last week. Sources called the market firm-to-stronger.

Eastern Cornbelt: UAN was quoted in a broad range at $15.63-$17.20/unit FOB regional terminals last week. The low end was reported at the $500/st level for UAN-32 out of spot river locations in Illinois, and the upper level reflected recent reference prices to the dealer.

Western Cornbelt: The UAN-32 market was reported in a broad range at $485-$500/st ($15.16-$15.63/unit) FOB terminals on the low end, with reports of postings from some regional suppliers now as high as $550/st ($17.19/unit) FOB to the dealer. No sales were confirmed at the higher levels, however.

Southern Plains: The UAN-32 market was quoted in a broad range at $495-$520/st ($15.47-$16.25/unit) FOB regional terminals to the dealer, also up dramatically from last report. The lower end of the range was reported out of production points in Oklahoma.

South Central: UAN-32 pricing was also up dramatically from last report, with the regional market quoted in a wide range at $495-$530/st ($15.47-$16.56/unit) FOB terminals to the dealer. The low end of the range was again reported at Vicksburg.

Southeast: The UAN market was up dramatically from last report. Sources quoted the terminal market at $14.66-$15.00/unit FOB. The dealer market for UAN-32 FOB Norfolk, Va., was tagged at the $475/st ($14.84/unit) level at midweek. Reference levels were quoted as high as $500/st ($15.63/unit) FOB from some regional suppliers last week, though no actual business was reported at the higher numbers.

As of July 9, Agrium was referenced at $14.70/unit FOB Bainbridge, Ga., $14.90/unit FOB Chesapeake, Va., and $14.95/unit FOB Wilmington, N.C. Agrium’s July 9 UAN S postings included 24 percent solution at $382/st FOB Bainbridge, Wilmington, and Chesapeake; 25 percent at $396/st FOB Chesapeake; and 28 percent at $441/st FOB Bainbridge.

AMMONIUM NITRATE

U.S. Gulf: With fall demand not that far off, sources said the market was firm-to-strong. Importers were reported to have posted much higher numbers for the fall – $550-$600/st FOB.

Western Cornbelt: Ammonium nitrate pricing was up dramatically due to much higher replacement costs, with sources quoting the regional market at $550-$600/st FOB to the dealer last week. As the week advanced, the higher end of that range was the more likely price out of regional shipping points.

Southern Plains: Ammonium nitrate pricing had reportedly firmed to $525/st FOB Catoosa, Okla., up significantly from last report.

South Central: Ammonium nitrate was pegged in a very broad range at $415-$480/st FOB in the region, although some were adamant that current prices would fall in the $460/st FOB or higher category as the week progressed.

Southeast: Ammonium nitrate pricing was up significantly, with sources tagging the Tampa market at a firm $515/st FOB last week. That level was up roughly $100/st from last report.

AMMONIUM SULFATE

Eastern Cornbelt: Granular ammonium sulfate was quoted at $455-$475/st FOB in the region.

Western Cornbelt: Granular ammonium sulfate was steady at $435-$475/st FOB in the region, with the low reported in Missouri on a spot basis. Effective July 25, Agrium’s granular ammonium sulfate postings firmed to $475/st DEL in Minnesota, Wisconsin, and North Dakota, up $15/st from the company’s July 16 posting and $35/st higher than the July 11 reference price in that location.

Southern Plains: Ammonium sulfate pricing was also on the march. Effective July 21, American Plant Food Corp.’s granular ammonium sulfate postings in Texas firmed to $410/st FOB Freeport, $420/st FOB Galena Park, $440/st FOB Fort Worth, and $450/st FOB Littlefield; coarse grade postings moved to $385/st FOB Freeport, $395/st FOB Galena Park, $415/st FOB Fort Worth, and $425/st FOB Littlefield; standard grade moved to $375/st FOB Freeport and $415/st FOB Littlefield; and N-Pac Compacted moved to $425/st FOB Galena Park. Those levels were up $35/st from APF’s July 7 postings.

Martin Resources also hiked its ammonium sulfate postings on July 21. Reference prices FOB Plainview, Texas, moved on that date to $450/st for granular, $440/st for coarse, and $415/st for standard. Those levels were up some $35/st from the company’s July 2 postings.

South Central: Granular ammonium sulfate pricing was up to $410-$450/st FOB regional warehouses. An Arkansas source pegged the dealer price firmly at the $425/st FOB level in his trade area last week. Effective July 21, American Plant Food Corp.’s ammonium sulfate postings firmed another $35/st to $440/st FOB Mermentau, La.

Southeast: Ammonium sulfate pricing was moving up. On July 21, DSM Chemicals moved its reference prices FOB Augusta, Ga., up to $450/st for granular and $390/st for standard grade sulfate, with delivered pricing in Florida firming to $470/st for granular and $410/st for standard. Effective July 14, Honeywell’s list prices moved to $475/st FOB warehouse or rail-DEL for granular ammonium sulfate, and $460/st FOB or rail-DEL for mid-grade sulfate.

Pacific Northwest: Agrium’s granular ammonium sulfate postings firmed again on July 25 to $470/st FOB the warehouse in Idaho, Washington, Oregon, Utah, and Nevada, and $475/st DEL in those states plus Montana and Wyoming. Those levels reflect a $15/st increase from the company’s July 16 postings, a $35/st increase from the company’s July 11 postings, and a $55/st increase from July 1 reference levels.

PHOSPHATES

Central Florida: After the Southwestern Fertilizer Conference saw a big bump in trades, business settled back into the summer doldrums last week. Both buys and the market were stagnant, sources said.

Producers remained busy shipping earlier orders and doing export business, primarily to India.

Some in the industry were concerned the price of corn, which has dropped more than $2/bushel in the past few weeks, might cause farmers to back off putting down phosphates, especially DAP, when spring rolls around.

The Central Florida DAP price range last week was unchanged from the previous week’s range of $1,025-$1,080/st FOB. PCS Sales’s Central Florida reference price remained unchanged at $1,070/st FOB for DAP and a $25/st FOB premium for MAP. Mosaic’s asking price increased to $1,090/st FOB for DAP and $1,115/st FOB for MAP. CF Industries was asking $1.070/st FOB for DAP and $1,145/st FOB for MAP. In Texas, Agrifos’ DAP price was $1,100/st FOB for trucks and $1,095/st FOB for rail shipments.

U.S.Gulf: Optimism generated at the Southwestern Conference was tempered last week by the declining price of corn, which slipped from about $8/bushel to around $5.70/bushel late last week. If that trend continues, some feared application of phosphates for corn crops would be reduced and prices could be negatively impacted. A source said it currently cost farmers around $1,100/acre to fertilize their fields for corn, and if the price dropped below $5/bushel, farmers could fall below the break-even point. However, another disagreed and said yields were expected to be much better than normal this year and farmers could still make money even if corn fell to $4/bushel. Still, declining corn prices would put pressure on the market to drop prices. Phosphates would be affected more than any other fertilizer.

Several said hedge funds, which had been responsible for driving up the price of corn, were pulling back from the market, but some said that was probably a temporary situation. Another said people were “spooked” about ethanol, which has had a psychological impact probably not grounded in reality.

With the market in a state of stagnation last week, many potential buyers took a wait-and-see attitude. Most dealers and warehouses have already filled their phosphate bins and saw no reason to act in the very near future, if prices were unlikely to rise and a fall was possible.

Some crops were already being priced out of the phosphate market, primarily vegetables and pastureland. The wheat crop was said to be extremely good and was in the process of being harvested in Oklahoma, so those farmers should have money to spend for the next season.

A collision of a barge hauling No. 6 fuel oil and another vessel in the Mississippi River near Mile Marker 97 forced the closing of the river all the way to the Gulf on July 23 while a cleanup effort was launched. The river could remain closed for hours or days and vessels were backing up, although there were no reports of fertilizer cargos being delayed.

NOLA DAP barge sales amounted to only a trickle of the number and volume the previous week. The price range last week declined slightly from $1,070-$1,095/st FOB the previous week to $1,070-$1,080/st FOB. MAP barges were available at prices $25-$75/st FOB more than DAP. Mosaic’s asking price for NOLA DAP barges was $1,100/st FOB and $1,125/st FOB for MAP, and its prices for October and November will increase $10/st FOB. CF was seeking $1,070/st FOB for DAP and $1,145/st FOB for MAP for prompt deliveries, if available.

Eastern Cornbelt: DAP out of regional warehouses remained at $1,080-$1,120/st FOB for DAP and $1,110-$1,150/st FOB for MAP. 10-34-0 remained in very tight supply, with no current prices reported last week.

Western Cornbelt: DAP remained at $1,080-$1,105/st FOB regional warehouses, with most sources quoting the upper end as the common dealer price in late July. MAP was pegged at $1,110-$1,145/st FOB. 10-34-0, where available, was reported at or above the $1,100/st FOB level last week, but spot tons were very limited.

Southern Plains: DAP was quoted at $1,075-$1,100/st FOB the Tulsa market, with MAP tagged at $1,135-$1,140/st FOB. No firm prices were reported for 10-34-0, with product remaining in very tight supply in the region.

South Central: DAP pricing out of regional warehouses was generally quoted at $1,100-$1,110/st FOB last week, with MAP in a broad range at $1,125-$1,175/st FOB to the dealer. TSP was up as well to $1,075-$1,100/st FOB the warehouse.

U.S. Export: PhosChem sold 12,000 mt into South America at $1,212/mt FOB, and an outside source said the customer was located in Peru. Transammonia was said to be using about 33 DAP barges to load a panamax-sized vessel for delivery to India last week. PhosChem was also said to be loading a vessel for India for shipment before the end of this month.

Brazil was said to be seeking lower prices for phosphates than the current market, wanting to pay between $1,250/mt and $1,260/mt delivered.

Price differences between the domestic and export markets were nearing parity, as the export market’s rise has slowed while the domestic market has been increasing in recent weeks.

The export DAP price range last week was $1,205-$1,212/mt FOB, up slightly from the previous week’s range of $1,202-$1,205/mt FOB.

India: Phos acid negotiations are reportedly occurring on a $2,200-$2,500 mt DEL basis. Sources said that one deal at the lower number may have been achieved, but added that it has certain stipulations tying it to the escalating price of sulfur.

In the meantime, OCP is reportedly offering phos rock into India at $430-$500/mt, based on grade.

Bangladesh: BCIC has issued a tender for 30,000 mt of phos rock (BPL 65.5 percent minimum). Bids are due in Aug. 11.

POTASH

U.S. Gulf: Barges of Russian product have reportedly been sold into the Midwest for third-quarter shipment at $950/st DEL.

Eastern Cornbelt: Potash pricing continued to firm as replacement costs ratcheted up. Sources quoted the warehouse market last week in a broad range at $850-$930/st FOB, reflecting a sizable increase from the previous week. Reports were confirmed of a 60 percent potash barge sale at $950/st DEL to the Midwest for third-quarter shipment.

Western Cornbelt: Potash prices continued to move up quickly. Sources tagged the market in a broad range at $850-$925/st FOB regional warehouses to the dealer, with most suppliers at or above the $900/st FOB level as the week advanced.

Southern Plains: Potash pricing continued to climb as well. Sources tagged the warehouse market at $850-$860/st FOB Catoosa early in the week, with some claiming a $900/st or higher dealer price as the week advanced. The Carlsbad, N.M., mine price was reported at $705-$710/st FOB for allocated tons, depending on grade.

Intrepid Potash announced higher potash postings as well. Effective Aug. 1, Intrepid Potash’s postings for 60 percent granular muriate will move to $782/st FOB Carlsbad, N.M., and Moab, Utah, and $800/st FOB Wendover, Utah; 60 percent standard will move to $776/st FOB Carlsbad and Moab, and $794/st FOB Wendover; 62 percent standard will move to $794/st FOB Carlsbad; 62 percent fine standard will move to $797/st FOB Carlsbad; and 62 percent granular will move to $800/st FOB Carlsbad.

South Central: Potash pricing continued to firm. Sources tagged the warehouse market in a broad range of $850-$930/st FOB, though sources were unsure if any actual spot sales had been made at the upper end of that range yet.

Southeast: The potash market was firming as well. Sources tagged the market at $750/st FOB based on recent producer postings, with allocated delivered tons reported at the $840/st level for the September forward period. Effective July 10, Agrium’s 60 percent coarse potash postings firmed to $750/st FOB Bainbridge, Wilmington, and Tifton, Ga.

Sulfate of Potash: K+S North America said July 18 that due to the continued unprecedented global potash market supply and demand pressures, effective with shipments on Aug. 1, the company will be raising sulfate of potash prices by $150/st on all grades.

China: Hanfeng Evergreen Inc. said last week that it has entered into a contract with Suifenhe Wanshida Chemical Fertilizer Co. Ltd. (Wanshida) to secure a three-year supply of potash. The contract allows for an initial purchase of 100,000 mt in the first year, with an annual increase of 50,000 mt each year through July 2011. Wanshida is a direct distributor in China for JSC Silvinit, one of the two largest potassium fertilizer producers in Russia, as well as one of twenty-five domestic enterprises that have been granted a potash import license by the Ministry of Commerce in China. Given its proximity to the Russian border, Hanfeng says Wanshida is able to enjoy a significant cost advantage by shipping potash directly from Russia to China by rail.

“This agreement marks the beginning of what we anticipate will be a successful relationship with Hanfeng,” stated Xiaoguang Wang, Wanshida president. “We expect to begin shipments to their Heilongjiang facility within the next 30 days. In the long term, we see a significant opportunity to utilize both their rail spur and their proposed distribution network, once both are operational, as a conduit for further potash imports.”

“Currently 83 percent of Hanfeng’s production is slow release NPK products. A stable and controllable cost based potash supply plays a significant role in our current requirements as well as our future growth,” stated Xinduo Yu, President and CEO of Hanfeng. “Potash is one of the more scarce nutrients for farmers in China, and our technologies are recognized as the most efficient and effective in increasing crop yields. We expect to continue to expand our product offering to include additional potash related products in the future.”

SULFUR

Tampa: Phosphate producers and sulfur suppliers appeared to be on the road to settling prices for third-quarter contracts late last week at $165/lt up from the previous quarter. If that price holds and all contracts are signed, the new Tampa price range for sulfur would become $615.50-$618.50 for product delivered by oceangoing vessels. Other Tampa prices would be adjusted accordingly. The $165/lt increase would be roughly halfway between what phosphate offered and sulfur producers said they would accept at the beginning of negotiations three weeks ago.

The new price would also put Tampa sulfur more in line with the world market, or within about $100/t, which would be far closer to parity than it has been in several years.

However, there were signs the sharp increase in sulfur prices in the world market may be coming to an end. Recent spot sales out of Vancouver to China were said to be in the range of about $770/mt FOB, which would be down about $60-$70/mt FOB from previous sales.

Two sulfur prill vessels, each loaded with around 27,000 mt, were scheduled to leave Beaumont in July. Although the destinations could not be confirmed, they were believed to be headed for Brazil.

West Coast: Negotiations for new quarterly contract prices will likely begin late this week or early next week. Contracts on the West Coast typically begin one month later than Tampa’s.

Vancouver: China was said to be taking a very hard line on prices for the current quarter and negotiations were not progressing, according to sources. Recent spot sales to China were done $60-$70/mt FOB below the level of previous spot sales, about $770/mt FOB.