U.S. Gulf/River: Shipping operators announced the closure of upper Mississippi River Lock and Dam 5A for the duration of the navigation season beginning on Dec. 8. The lock is scheduled to reopen on March 15, 2015, weather permitting.
Lock and Dam 22 on the upper Mississippi will close Sept. 29-30 for four hours daily to complete repairs and maintenance. Lock and Dam 20 will also see four-hour shutdowns on Oct. 1-2 while repairs are completed.
Massive delays were reported on the upper Ohio River between Mile OR 13.3 and OR 31.7. Wait times at Dashields Lock were pinned at 48-60 hours for the week while main chamber repairs, expected through Sept. 19, were conducted. Similarly, 48-60 hour delays were reported at Montgomery Lock, where main chamber maintenance was scheduled to conclude Sept. 5.
Lock 52 on the lower Ohio was also engaged in main chamber repairs, and saw average queue lengths of 14 boats with accompanying delays of 24-36 hours. Work on the main chamber is set to wrap up Sept. 12, but the lock’s auxiliary chamber will close Sept. 22 through Oct. 19.
The lower Ohio’s R.C. Byrd Lock was subject to 1-2 hour delays for the week, and comparable waits were reported at J.T. Meyers Lock. Tow limits for southbound transit through the Olmstead Locks and Dam Project will remain in effect until elevated river flows subside.
On the Arkansas River, ongoing miter gate repairs at W.D. Mayo Lock No. 18 shut down all lock transit through Sept. 14. Vessels are free to move above and below the lock during the closure.
In the Gulf, Industrial Lock was closed Sep. 4 from 7 a.m. to 1 p.m., exacerbating delays of 12-18 hours reported for the week. Other notable waits in the area included Bayou Sorrel Lock (2-3 hours), Port Allen Lock (4-6 hours), and Algiers Lock (1-2 hours).
CHS Inc. announced on Sept. 5 that it will proceed with construction of a fertilizer manufacturing plant at Spiritwood, N.D. The CHS board of directors approved final plans for the approximately $3 billion project at its September meeting. Groundbreaking will take place following completion of additional details, with the plant intended to be fully operational in the first half of calendar 2018. When complete, the plant will employ 160-180 people.
“With this decision, CHS is taking an important, strategic step on behalf of its member-owners by ensuring them a reliable, domestic supply of nitrogen fertilizers essential to help farmers raise healthy, profitable crops to feed a growing global population,” said Carl Casale, CHS president and CEO.
The fertilizer plant at Spiritwood will be the single largest investment in CHS history, as well as the single largest private investment project ever undertaken in North Dakota. “CHS is proceeding today as the plant’s sole investor,” said Casale. “However, because our owners’ interests are at the heart of what we do, we will always pursue ownership of strategic assets and partnerships that will help us continually add value to their businesses.”
The CHS fertilizer plant will produce more than 2,400 tons of ammonia daily, which will be further converted to urea, UAN, and Diesel Exhaust Fuel (DEF). The majority of the nitrogen products from the plant will serve farmer-owned cooperatives and independent farm supply retailers within a 200-mile radius of the plant in the Dakotas, parts of Minnesota, Montana, and Canada.
The facility will be located 10 miles northeast of Jamestown, N.D., on a 640-acre site near the Spiritwood Energy Park. When fully operational, it is expected to use an estimated 88,000 mmBtu/day of natural gas, 40 megawatts/day of electricity, and 2,400-2,700 gallons/minute of water.
CHS first announced its interest in building a fertilizer manufacturing plant in September 2012 (GM Sept. 17, 2012). In April 2014, the company postponed a final decision when construction and labor costs exceeded initial estimates (GM April 7, p. 1).
“Because of the size and scale of this investment, we needed to take the additional time to review costs and reassess areas where we could make modifications,” Casale said. “We are now fully prepared to proceed with an investment that will add tremendous value to our member-owners, and further expand our global crop nutrients business platform.”
Brian Schouvieller, CHS senior vice president, Ag Business, said CHS has plans for a fully-trained, onsite emergency response team for fire and EMT services during the plant’s construction and when it is operational. He said CHS will also develop an emergency response plan with community responders, and the plant will employ safety systems for fail-safe shutdown.
“CHS is a financially strong company with the balance sheet strength to undertake this significant investment,” said Tim Skidmore, CHS executive vice president and CFO. “We believe this fertilizer plant will deliver solid returns on our owners’ investment in addition to providing them with an essential crop input.”
U.S. Gulf/Tampa: While nothing new was reported in the Tampa and NOLA markets last week, sources did note concerns in Trinidad. Sources said methanol and nitrogen producers are seeing less gas than expected in the third quarter. Cutbacks were expected in the first half, but the industries were expecting a reprieve in the second half.
Major producers contacted by Green Markets last week all confirmed this assessment, with one saying it was due to the tie-ins of new gas platforms. One predicted that September might be off as much as 30 percent, but there was hope that once work was completed, production would ramp back up in the fourth quarter.
In other news, OCI Partners on Aug. 29 reported that its Beaumont ammonia plant was offline for 2 days, with methanol down 9 days. OCI expects to shut down the ammonia and methanol production lines for 28 days and 48 days, respectively, on Oct. 1 in order to complete its current upgrade project.
October NYMEX natural gas settled Sept. 4 at $3.819/mmBtu, down from the Aug. 28 close of $4.044/mmBtu.
Eastern Cornbelt: Sources pegged the anhydrous ammonia market at $645-$650/st FOB in the Eastern Cornbelt, with the low in Illinois and the upper end in Indiana for fall prepay. “Summer fill is over,” said one regional contact. “We don’t expect to see any significant movement now until the second half of October.”
Western Cornbelt: Anhydrous ammonia remained in tight supply in the Western Cornbelt. The market was quoted at $630-$655/st FOB, with the low in Nebraska and the upper end in Iowa and Missouri.
Sources described fertilizer activity as slow in the region. “Growers are focused on harvest, with very little interest in fall fertilizer, especially with the price of corn today,” said one contact. “It’s difficult for me to say prices are rising, but they are firm and inching up ever so slowly.”
Southern Plains: Sources continued to report tight ammonia supplies in the Southern Plains, although movement was described as light. “Supply has loosened up, but overall I think it is very thin if we have heavy movement,” said one contact.
The ammonia market in the Southern Plains continued to be quoted at $600-$620/st FOB regional production points, with the pipeline terminal market pegged at $630-$635/st FOB in Kansas. Effective Sept. 28, Agrium’s anhydrous ammonia postings firmed to $620/st FOB Borger, Texas, $625/st FOB Mocane, Okla., $630/st FOB Conway, Kan., and $635/st FOB Clay Center, Kan.
South Central: Anhydrous ammonia pricing had reportedly firmed to $600-$620/st FOB in the South Central region, up some $20/st from last report, with the low FOB Memphis, Tenn. Sources reported no new ammonia sales out of the Henderson, Ky., market, noting that this location is “predominantly a spring terminal.”
Middle East: Industry sources are now saying that rumors of a Koch-Fertil deal at $550/mt FOB are an exaggeration. Even with that denial – from buyer and seller – sources still say $550/mt FOB is not out of reach for October business.
Efforts to duplicate a previous sale from PIC at $525/mt FOB are now seen as no longer viable. Sources say the price has moved into the $530s/mt FOB, with regular talk of pushing for that $550/mt FOB level.
The limited amount of natural gas being sent to Egyptian plants has pretty much eliminated Egypt from the international market. The government shif
U.S. Gulf: Prompt granular barges were fairly quiet last week, with one source calling them “stagnant.” Prices have fluctuated week-to-week for some time, but this week they remained at approximately $347-$360/st FOB. Sources said the range reflects varied freight considerations.
The last done on the prill market was called $345-$350/st FOB, though sources said those numbers may be hard to repeat for the next round of business.
Eastern Cornbelt: The urea market in the Eastern Cornbelt was pegged at $415-$435/st FOB regional terminals for limited tons.
Western Cornbelt: The granular urea market remained in a broad range at $395-$425/st FOB regional terminals in the Western Cornbelt, depending on location, with the St. Louis, Mo., market pegged at $415-$420/st FOB last week.
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, Wisconsin, and the Dakotas. Those levels were up $15/st from Agrium’s July 1 postings in those locations.
Southern Plains: The granular urea market was pegged at $425-$430/st FOB Catoosa, Okla., down some $15-$20/st from pricing levels three weeks earlier.
South Central: Sources reported minimal movement in the South Central region as growers focus on harvest, but concerns remained about logistics. “I’m guessing that this huge crop will put even more stress on our transportation system going forward,” said one regional contact. “That being said, today’s farmer can certainly hold a lot more of his crop on the farm.”
The granular urea market had reportedly narrowed to a range of $410-$420/st FOB in the South Central region, with the low reported in Memphis.
Southeast: Granular urea pricing had reportedly firmed to $425-$430/st FOB port terminals in the Southeast, with no tons available at Savannah, Ga., last week.
Sources reported some nitrogen movement on hay and pastures in early September, but activity was otherwise quiet. “There is no enthusiasm with low crop prices right now,” said one regional contact.
India: Sources report that Indian buyers visited China last week. One industry watcher noted that this move replicated trips in the past when Indian buying representatives visited Russia, Ukraine, and Arab Gulf producers.
The industry is waiting for the next Indian tender. Sources speculate that the announcement from MMTC could come as industry leaders travel to San Francisco for the TFI World Fertilizer Conference. Others say the announcement will come after the conference. Either way, industry watchers are agreed that MMTC will have to call its tender before Sept. 15.
The mid-September deadline for calling the tender is dictated, say sources, by the Chinese export window. Beginning Nov. 1, Chinese urea will be automatically more expensive because of additional export tariffs imposed on the product. Tender award winners will have to move quickly to secure the tons from a producer, make sure it is shipped to the bonded warehouses, and secure a vessel in time to avoid the extra taxes.
How many tons MMTC will take in its tender will not only depend on the price of the product, but also on how many tons the country needs. Sources report that not all the awards issued in the IPL tender may be completed in time.
Reportedly, some traders are still having a hard time fulfilling their awards. The shortfall is up for debate. Some have argued that IPL will be short by 300,000 mt, while others say the deficit will be closer to 600,000 mt.
What does appear to be clear, however, is that trade
U.S. Gulf: The market continues to fall into the $235-$245/st ($7.34-$7.66/unit) FOB range. While some argue that prices are at the higher end of the range, others stand by the $235/st FOB. Last week, there were unconfirmed reports of $231-$233/st ($7.22-$7.28/unit) FOB.
As with ammonia, gas curtailments in Trinidad are expected to have some impact on UAN supplies available from that country.
Eastern Cornbelt: UAN-32 continued to be quoted at $290-$295/st ($9.06-$9.21/unit) FOB Illinois terminals, with the UAN-28 market tagged at $255-$265/st ($9.11-$9.46/unit) FOB in Ohio and Indiana.
Western Cornbelt: The UAN-32 market was steady at $285-$300/st ($8.91-$9.38/unit) FOB terminals in the Western Cornbelt, with the low end reported at spot river locations in both Missouri and Iowa.
Southern Plains: UAN-32 pricing had slipped slightly. Sources tagged the market at $275-$300/st ($8.59-$9.38/unit) FOB in the Southern Plains, with the low out of Gulf Coast terminals in Texas and the upper end out of Oklahoma production points.
South Central: The UAN-32 market remained at $285-$290/st ($8.91-$9.06/unit) FOB most terminals in the South Central region, depending on location.
Southeast: The UAN-32 market remained at $255/st ($7.97/unit) FOB Savannah and $260/st ($8.13/unit) Norfolk, Va., and Wilmington, N.C.
U.S. Gulf: The market remained quiet at $300-$310/st FOB.
Western Cornbelt: Ammonium nitrate was quoted at $360-$380/st FOB in the Western Cornbelt, with the low reported in Missouri and the upper end in the Iowa market.
Southern Plains: The Tulsa ammonium nitrate market was quoted at $360-$370/st FOB, down $10/st from last report.
South Central: Ammonium nitrate was quoted at $350-$355/st FOB Memphis and Yazoo City, Miss., down $5-$25/st from last report, depending on location.
Southeast: The Tampa ammonium nitrate market was pegged at $380/st FOB in early September.
Eastern Cornbelt: Granular ammonium sulfate was quoted at $275-$285/st FOB in the Eastern Cornbelt, with rail-delivered tons quoted in the $285-$290/st range.
Ammonium thiosulfate was unchanged at $345-$350/st FOB in the region.
Western Cornbelt: Granular ammonium sulfate was quoted at $275-$285/st FOB in the Western Cornbelt, up $5/st from last report. The ammonium thiosulfate market remained at $320-$345/st FOB in the region.
Southern Plains: Sources reported steady movement of ammonium sulfate on wheat ground in the Southern Plains. American Plant Food (APF) Corp.’s granular ammonium sulfate postings in Texas dropped $30/st on Aug. 4, falling to $230/st FOB Freeport, $240/st FOB Galena Park, $255/st FOB Fort Worth, and $265/st FOB Littlefield.
APF’s coarse ammonium sulfate postings fell as well on Aug. 4, to $220/st FOB Freeport, $230/st FOB Galena Park, $245/st FOB Fort Worth, and $255/st FOB Littlefield, with standard referenced at $210/st FOB Freeport and $245/st FOB Littlefield, and N-Pac Compacted posted at $245/st FOB Galena Park.
South Central: Granular ammonium sulfate pricing in the South Central region was down from last report. Sources quoted the Memphis market at the $250/st FOB mark on the low end, with the upper end of the regional range pegged at $275/st FOB in Arkansas on a spot basis.
APF’s granular ammonium sulfate postings dropped $30/st on Aug. 4, falling to $255/st FOB Mermentau, La.
Ammonium thiosulfate remained at $310-$315/st FOB regional terminals.
Southeast: Sources said orders for ammonium sulfate fill tons in the Southeast were no longer being accepted at the low levels reported in August. Prices were up $10/st as a result, with the granular ammonium sulfate market quoted at $255/st FOB Hopewell, Va., and Augusta, Ga., and $260-$270/st DEL in the region.
Central Florida: Central Florida phosphate traders reported market conditions essentially unchanged from recent weeks. How long they stay that way was ripe for debate, however, as industry players kept a close eye on perceived instability in the NOLA barge market as a potential indicator of things to come.
“If prices on the river are dropping lower than Central Florida, who knows how long they can stay (at current levels)?” one trader questioned.
DAP transactions on the Central Florida phosphate market were unchanged at $435-$440/st FOB. Traders continued to describe MAP as unobtainable in the present market, with the price pegged at $455-$460/st FOB based on producer postings.
Rail congestion, reportedly still problematic throughout much of North America, was said to ease considerably for product shipped out of Florida, removing one potential barrier to market participation. “Florida rail is almost back to where it was before it got in real trouble,” said one source.
U.S. Gulf: Sources described a standoff in the NOLA DAP market last week, as buyers and sellers held vastly differing views of exactly what constituted fair market value.
Most buyers were reportedly willing to pay around $425-$430/st FOB NOLA equivalent for September-loading DAP, though sources put the bulk of offers closer to $445-$455/st FOB.
The $15/st FOB gap proved a significant obstacle for the week, though a small number of confirmed transactions were reported in a range of $435-$443/st FOB. MAP continued to enjoy strong price support on limited volume, with sales occurring in a range of $475-$480/st FOB.
The justification for low-priced DAP bids was attributed to a handful of recent barge sales at levels in the mid $420s/st FOB. The barges’ real dollar values were much less clear, however, thanks both to the continued foggy freight climate as well as some sellers’ rumored propensities for artificially inflating barge freight to pump up their netbacks.
A closer look at the sub-market trades suggested actual seller netbacks closer to the mid-$430s/st FOB, an amount suggested by many to be the actual baseline for the current market. Some potential buyers were reluctant to pull the trigger at those levels, however, for fear they could end up on the wrong side of a newly adjusted market should sellers unexpectedly accept the lower bids.
The uncertainty led potential buyers to adopt a “wait and see” approach to new purchases, and the market was expected to remain low-key at least through the end of the TFI World Fertilizer Conference, which wraps up on Sept. 9.
Anxiety regarding September 2014 corn prices, which hit a four-year low in intraday trading last week on reports of a likely record harvest, also contributed to the lack of activity in the market. Sources described “big concerns” that fertilizer application rates could follow grain prices south and depress end-user purchasing ahead of the river closing.
Phosphate inventories were said to remain strained throughout the country, though supply tightness at upriver terminals had eased somewhat from recent weeks.
Prices on the NOLA barge market softened to $435-$443/st FOB based on limited transactions, down from $435-$447/st FOB at last report. MAP was quoted in a range of $475-$480/st FOB on high demand.
Eastern Cornbelt: The DAP market remained at $480-$490/st FOB regional warehouses in the Eastern Cornbelt. MAP was reported in the $510-$530/st FOB range, depending on location, and in tight supply.
10-34-0 was steady as well at $460-$480/st FOB in the Eastern Cornbelt.
Western Cornbelt: DAP remained at $480-$490/st FOB most terminals in the Western Cornbelt, with MAP pegged in the $510-$530
U.S. Gulf: The potash range broadened last week to $367-$378/st FOB. Sources were divided, with some saying product was still available sub-$370/st, and others saying no.
Eastern Cornbelt: The potash market had firmed to the $410-$417/st range FOB regional warehouses in the Eastern Cornbelt, depending on grade, with inventories continuing to be described as tight.
Western Cornbelt: Sources quoted the potash market solidly in the $410-$417/st FOB range out of warehouses in the Western Cornbelt, with the low for red and the upper end for white granular tons. “Potash supplies are still snug in my opinion,” said one regional contact. “I don’t know of anyone that has all they want to start fall, but it is slowly arriving.”
Southern Plains: Potash pricing out of regional warehouses in the Southern Plains was quoted at a firm $400-$405/st FOB, up $10/st from last report. Reference prices FOB Carlsbad, N.M., included $385/st for 60 percent standard, $390/st for 60 percent granular and 62 percent standard, and $397/st for 62 percent granular and 62 percent Super Sol.
Sulfate of potash magnesia remained at $365-$380/st FOB Carlsbad, depending on grade.
South Central: Potash pricing had reportedly firmed to $400-$410/st FOB warehouses in the South Central region, with the low at Memphis. Sources reported little demand, but acknowledged tight potash supplies in the region. “I hope we don’t see another winter/spring like last year, as we will have shortages,” said one contact.
Southeast: The potash market had reportedly firmed to $410/st rail-DEL in the Southeast for new sales, but tons were limited.
Bangladesh: Belarusian Potash Co. (BPC) has signed a $40 million contract to supply potash to Bangladeshi state-run BADC, according to Belta, the Belarusian News Agency. BPC said it plans to start by sending two in October, with the possible delivery of about 120,000 mt. BPC officials said it already has another contract to ship 120,000 mt to the private sector.
Sri Lanka: The Agriculture Ministry closed a tender last week for 24,000 mt of MOP.
Offers were presented with a variety of financial options. Sources speculate that the most likely acceptable price will be the one with 80 days credit. If that is the case, the most likely winner in the tender will be Agricultural Resources at $344.35/mt CFR 180 days.
Only four companies participated in the tender. The tally follows.
Sri Lanka Ministry of Agriculture Tender – Prilled Urea
Offering Company
Quantity (mt)
US$/mt FOB
Freight (US$/mt)
US$/CFR
Origin
Validity
Sight
180 Days
270 Days
Agricultural Resources
24,000
Disclaimer of Warranty
All information has been obtained by Green Markets from sources believed to be reliable. However, because of the possibility of human or mechanical error by our sources, Green Markets or others, Green Markets does not guarantee the accuracy, adequacy, or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information.
