All Posts from March 29, 2012

Emmsons awarded 500,000 mt in tender

India bought its first new tons of urea this week when IPL awarded 500,000 mt to Emmsons at AED1417.25 (US$385.83/mt). Due to a transmission error, this originally came through to Green Markets as 50,000 mt. The price indicator UAE Dirhams and Emmsons’ history made it clear to industry watchers that the tons – while identified as “open” in the tender – will come from Iran. In the week leading up to tender closing March 23, industry sources were sure awards would go to traders offering Iranian tons.

All told only 1.5 million mt were offered in this tender. The December 2011 IPL tender – the most recent Indian tender before the current one — had more than 2.5 million mt offered.

The award price also provided evidence that the market is in a bearish state. Earlier talk was that prices would be near $400/mt CFR. The lowest price in the last tender was $444.40/mt CFR.

Arab producers hoped to prevent a slide in prices with offers at $440-$442/mt FOB. In the last tender they offered $512-$518/mt FOB.

The last bit of public business between tenders came in at $450-$460/mt FOB. Since then the talk has been of prices closer to $410-$420/mt FOB but that was only talk. Producers talked of $450/mt FOB and buyers of $420/mt FOB.

While the Arab producers’ offers showed they are willing to take less than the prices they were talking about last week, their pricing ideas are still too high when compared to the Iranian tons being offered just across the Gulf.

Mosaic 3Q earnings off by 50 percent

The Mosaic Co. reported a 50 percent drop in net earnings for the third quarter ending Feb. 29, 2012, to $273.3 million ($.64 per diluted share) from the year-ago $542.1 million ($1.21 per share). Net sales were off only slightly to $2.19 billion from the year-ago $2.2 billion. Mosaic said growth in phosphate sales were offset by declines in potash sales.

“We are continuing to make significant strategic progress for long-term success even as we work through seasonal and cyclical market factors, and we feel very good about our business momentum,” said Jim Prokopanko, Mosaic president and CEO.

For more details, see the Green Markets Web-Edition March 30.

Tampa ammonia trades up

New Tampa anhydrous ammonia business has been concluded by major players at $470/mt DEL for April, up some $70/mt from March. Sources say the $70/mt increase indicates that a $359/mt spot cargo to Tampa reported earlier was a distressed cargo by a heretofore unknown seller and not reflective of the true market.