Calgary-Agrium Inc. on June 4 pleaded guilty to one charge of failing to provide a safe workplace, and has been fined $180,000 for a 2006 accident at its Vanscoy potash mine that left one employee paralyzed. The Saskatoon provincial court stayed nine other charges under the Occupational Health and Safety Act, and in a joint submission to the court, Agrium and the Crown agreed to one guilty plea and the fine. The 2006 accident occurred when 29-year-old employee Paul Goddard was crushed by 900 kilograms of rock while working underground. Goddard suffered a broken spinal cord and severely broken arms, and spent nearly five months in the hospital. Kelly Reynolds, president of the United Steelworkers Local 7552, was quoted in the local press as saying the company had been warned by the union about failing to provide proper training to young miners, and called the accident “foreseeable, predictable and preventable.” Tom Diment, general manager of the Vanscoy mine, said the company concluded in its own investigation that it could have done more, and said additional safety training and technology has been added since the accident. Diment also said Goddard has a job at Agrium if he chooses to come back to the company. “It was in our interest all along to bring a timely and satisfying resolution to this,” Diment was quoted as saying. “It has been very hard on our organization and on Paul and we weren’t interested in dragging this out any longer.”<
U.S. Gulf/Tampa:With the Tampa price for June settled at $510/mt, there was not a lot of news last week. However, it appeared prices may be going up in July, based on recent prices obtained at the Black Sea. Prices there had been lingering around $420-$425/mt, but moved up to $430-$440/mt for recent sales as a result of reduced availability due to turnarounds at several plants. The Tampa and Gulf markets tend to follow trends at the Black Sea.
Meanwhile, CF Industries was said to have purchased 35,000 mt from Sabic at $500/mt, and the material will be transported on the vessel Steven N. It was expected to arrive at Donaldsonville in late June. In addition, 37,000 mt were loaded onto the vessel Clipper Posh around June 1 for Koch in a buy from Qafco at Katar at $520/mt. That product was expected to arrive in early July.
Eastern Cornbelt:Growers were not catching much of a break in early June, as another round of powerful storms tracked through the Midwest. In areas where weather and field conditions allowed it, sources continued to report a little bit of fertilizer movement for preplant and sidedress applications. Because of the late date, several sources said leftover spring prepay tons of anhydrous ammonia were being actively bartered between dealers in the $740-$760/st FOB range, while pricing from wholesalers was generally reported in the $780-$800/st FOB range for spot market tons.
Sources also reported lots of continued inquiries for fall ammonia tons. Some suppliers continued to reference very bullish forward contract numbers in the $1,020-$1,030/st range FOB regional terminals for July through December.
Western Cornbelt:Dealers reported some sidedress activity in the region as weather and field conditions permitted. Several sources confirmed dealer-to-dealer trades taking place on spring prepay ammonia as the season winds down. There were reports of spot deals taking place in the $700-$740/st FOB range on these tons, with one source reporting a $720/st DEL price in Missouri.
Ammonia pricing from producers, however, remained high, with reports of dealer postings at the $720/st FOB level out of production points in Kansas and Oklahoma, and up to $760/st FOB pipeline terminals in Kansas. One supplier was referencing forward contract ammonia for July through December at $1,010/st FOB in Nebraska and $1,015/st FOB in Iowa.
Northern Plains:There was minimal activity last week to test the spot ammonia market, but several sources said cash prices had firmed significantly. A Minnesota source pegged the spot market in a broad range at $950-$1,005/st FOB terminals to the dealer, with the lower numbers coming from resellers for limited tons.
Delivered ammonia in North Dakota was quoted at the $1,050/st mark. Agrium’s anhydrous ammonia postings in the Leal, Velva, Grand Forks, and Beulah sales area in North Dakota firmed on May 28 to $1,065/st FOB and $1,085/st DEL.
One supplier was referencing forward contract ammonia for July through December at $1,015/st FOB Minnesota terminals and $1,035/st FOB in North Dakota.
Eastern Canada: Anhydrous ammonia was moving for sidedress applications on corn in the region. Sources tagged the ammonia market at $875-$905/mt FOB in Ontario for cash market tons only, with the upper end reflecting reference pricing to the dealer. Those levels were up considerably from last report, and sources reported no fall prepay offers on the table.
Several dealers said they saw no rate cutbacks this spring due to high fertilizer prices, but many are concerned that fall application rates will suffer because of drastically higher replacement costs. Growers were already offering some “pushback,” according to one source, and federal legislators were starting to take a look as well at retail fertilizer prices and fertilizer producer profit margins.
Black Sea: Asian sources said the price has not only reached its nadir, but is on its way back up. Prices had been hovering near the KIP of $420/mt FOB for a while. Now, however, sources said the price has moved up. There are solid reports of a deal at $440/mt FOB.
With that sale, producers are now asking $460/mt FOB. As of late last week, however, the $460/mt FOB was not done. Industry observers are torn as to what will happen. One Asian trader said it is unlikely $460/mt FOB will be hit, adding that it was too unusual for dramatic price increases to occur in June. Another trader, however, was comfortable in predicting that $460/mt FOB will be achieved this week.
One observer noted that the shutting down of several production lines for routine maintenance this month is a prime motivator in the increased prices. At least three producers will be taking down parts of their operations for 30-45 days.
Adding to the upward pressure on prices are reports that the Middle East is sold out and that a natural gas explosion in northwest Australia could severely reduce ammonia output.
Middle East: Mitsubishi concluded deals with Sabic and Qafco to send ammonia to the U.S. and South Korea. The reported price of the material, according to industry gossip, was $400-$410/mt FOB. The actual value of the cargoes – 35,000 mt and 20,000 mt – is a matter of debate among industry watchers.
One source noted that for a cargo to be competitive in the U.S., the netback had to be in the low-$400s/mt FOB. At the same time, a higher netback might be achieved selling to South Korea.
Producers argue the price is irrelevant because both deals represented a small portion of the ammonia shipped from the area. Buyers, however, argue that because these are the only spot tons that have been seen in a while, the price is indicative of where the area market is heading.
To bolster their argument, buyers are saying the contract price into India is dropping as well. Still, producers maintain supplies are short in a time of strong demand. Part of the shortage comes from routine turnarounds in the area. They also say that both cargoes are being shipped on vessels either chartered or owned by the trading house. Nailing down accurate shipping costs under such an arrangement is iffy and allows both sides to claim FOB levels to their favor.
In the past, one or two producers have offered tons far below the market rate to ensure empty storage tanks. Once they sold the cargoes, the producers would then tell prospective buyers looking for a similarly low price that no tons were available, and would demand a significantly higher price for a deal.
Both sides do agree, however, that material in the upper $400s/mt FOB is not around, indicating a softening of the price. Producers argue that an average of the lower-priced spot tons and higher-priced existing contracts should be the way to peg the market. Others, mostly buyers, say the lower-cost spot deals should set the price in the low $400s. And a third group says both are right.
To accommodate the contracts and spot business, sources put the market at $410-$450/mt FOB.
Asia: Demand remains strong. Local buyers may soon have to start looking beyond their usual suppliers because of a natural gas explosion in Australia.
Asian sources were not able to expand on how severe the damage will be to the ammonia market, but some buyers are looking to snap up whatever spot tons they can find. One source noted that a deal by Mitsubishi with a Middle East supplier for a Korean buyer might have occurred because of the explosion.
Indonesian plants continue to operate at full capacity. Reports are circulating of some minor hiccups in Malaysia, but not enough to cause a drastic shortage of product.
Australia: Local media reported a natural gas explosion last Tuesday off the northwest coast. The project operator, Apache Energy, told reporters it could not estimate how long it would be before it could resume supplying natural gas. The loss of gas is forcing Burrup Holdings to move up its scheduled maintenance turnaround. The turnaround was scheduled for July, but is now apparently being pushed forward.
The unexpected loss of ammonia from the facility, which is partly owned by Yara, is affecting Asian buyers who have come to depend on the ammonia from the plant. The loss of the gas is also drastically affecting other industrial and residential clients.
UREA
U.S. Gulf: Sales of urea picked up a bit last week as rice farmers began hitting the warehouses, but some were considering switching to using lower-priced ammonium nitrate, which was considerably under the $658-$670/st FOB price of granular urea. A source noted it was unusual for rice farmers to make that switch.
Rain was still a problem in some areas, and water levels were higher than normal on the Mississippi River last week. The Arkansas River was still difficult to navigate last week, but sales of urea were said to be up, along with prices at terminals there. With drier weather, farmers in Oklahoma were beginning to come in to purchase urea for topdress applications.
Eastern Cornbelt: The granular urea market covered a wide range of $635-$700/st FOB last week, with the low reported by Illinois sources out of spot river locations and the upper numbers reflecting reference levels in Ohio. Agrium reposted granular urea on June 4 at $700/st FOB Marseilles, Ill., Mt. Vernon, Ind., and Cincinnati/Finney, Ohio; $710/st FOB E. Liverpool, Ohio; and $720/st FOB Saginaw, Mich.
Western Cornbelt: The granular urea market was pegged at $635-$685/st FOB, with the upper end reflecting dealer reference levels in Iowa. A Missouri source pegged the common dealer price last week at the $670/st FOB mark, but movement had virtually stopped. Agrium reposted granular urea on June 4 at $700/st FOB St. Louis, Mo., and $705/st FOB Hoag, Neb.
Northern Plains: Granular urea was quoted at $650-$685/st FOB the Twin Cities, and roughly $710/st DEL in North Dakota. On a forward contract basis for July, urea was being offered at $720/st FOB Pine Bend, Minn., and $750/st DEL in North Dakota and northern Minnesota.
Agrium’s granular urea postings firmed on May 28 to $705/st FOB Shakopee, Minn., and North Dakota terminals at Alton, Carrington, Colfax, Marion, and Scranton; and $710/st rail-DEL in Minnesota, Wisconsin, and the Dakotas. Those levels reflect a $35/st increase from the company’s May 8 postings, and a $110/st increase from May 1 reference levels in the region. Agrium announced another pricing change on June 4, putting the urea reference price FOB Marion, S.D., at the $705/st level as well.
Northeast: Granular urea was pegged in a broad range at $642-$685/st FOB, with the low reported at Philadelphia, Pa., and E. Liverpool, Ohio, and the upper end reflecting dealer reference pricing FOB Baltimore, Md. Prilled urea was quoted at the $632/st level FOB E. Liverpool. On June 4, Agrium’s granular urea postings firmed to $710/st FOB E. Liverpool and Bainbridge, Ga.
Eastern Canada: Granular urea pricing was up from last report at $780-$787/mt FOB in the region.
India: Major buyers are still sitting on the sidelines. Asian sources say buyers such as MMTC and IPL may even wait until July before deciding to step in.
Reports circulated that Transammonia did a deal with one buyer using Black Sea urea. The impact of that deal, however, was dismissed by Asian sources.
Other sources are convinced STC will call for another formula-based tender this week. The last time STC did this, the price was moving up. The buying company decided the price was too high. After some private talks with the offering companies, STC saw there was no hope for lower prices. They let the validity period pass without action.
This time, say sources, Yuzhnyy pricing is under pressure, and some Chinese tons are making their way out of the country. Just how low prices might go is up in the air. Few think the price will be low enough to make STC – or any other Indian buyer – jump at the chance to buy.
Reportedly, Indian buyers are looking to pay no more than $630/mt CFR. At that level, sources say, the Yuzhnyy price will have to come off another $70-$80/mt. So far, said one source, Indian buyers seem to be pushing the price down with their absence from the market. How long they can stay away, however, is the big question.
Sources say the government is in a difficult position. If it allows imports at current levels, the purchases could bankrupt the treasury because of the subsidy payments that would be required to make sure farmers get their urea at promised set prices. If they do not import urea soon, said one trader, the farmers will complain of urea shortages and provide the opposition party with a handy campaign issue in the upcoming national elections.
Black Sea: The price has been steadily falling. Sources in Asia last week report that $640/mt FOB is the high end of the market now. Reports are circulating that Transammonia did a deal to an Indian buyer at $600/mt FOB. Some of the Asian traders dismiss the deal as small and to an industrial buyer.
Everyone seems to be waiting for the big end-user buyers from India to step in, but so far they are holding off. At the same time, buyers from Latin America are also holding back on their purchases. The combination seems to be working as the Yuzhnyy price softens.
Even discounting the Transammonia deal, sources say quotes below $600/mt FOB are being heard around the industry. For now, however, sources say the price is closer to $620/mt FOB even as the producers argue for more.
If Yuzhnyy producers want to participate in any future Indian tender, sources say the price has to come down even more. Indian buyers are said to have it in their head they won’t pay more than $630/mt CFR. With freight rates around $90/mt for a panamax from Yuzhnyy to India, that means the selling price needs to be around $540/mt FOB.
Indonesia: PIM closed its selling tender last week for 20,000 mt. The deal was for two cargoes of 10,000 mt each. Bids in the tender follow.
PIM Tender
Bidding Company
US$/mt FOB
1. Youngwoo
738
2. Liven
718
3. Profeta
705
4. Summit
703
5. Trada
690
6. BBSC
687
7. Indevco
685
8. Diva
680
9. Parna
675
10. Ameropa
672
11. Toepfer
620
Source: Green Markets
Sources report the seller refused to sell the second 10,000 mt to Liven when the trading house refused to match the Youngwoo price. Industry sources are split on what finally happened. Some say Youngwoo was given an award for the first 10,000 mt and a follow-up tender will be called this week to sell the remaining tons. Others say the whole 20,000 mt were held back to be re-offered next month.
Sources say the $738/mt FOB is not a bad price for regional deals.
The most likely end user of the cargoes will be industrial buyers in Thailand or Malaysia. If the tons go to Thailand, the urea would not face the usual 5 percent import duty. That would mean a landed price of about $770/mt CFR. Urea from the Middle East might come in a bit lower, but producers there are claiming empty cupboards. Any other source would be much more expensive.
PIM is slated to call another 2×10,000 mt selling tender late next month.
Middle East: Granular urea is pushing ahead of prills, sources said, but only because all the prill production is down for maintenance. Granular business has been concluded at $710/mt FOB. Sources report some deals might also have been done just under $700/mt FOB.
Prills are being pegged at $670-$680/mt FOB. But, say sources, this is more talk than actual business. With the production lines down, no one can point to actual business to back up their pricing claims.
At these levels, sources say Indian buyers are expected to stay away from the area. Producers are reportedly not too bothered by this line of thinking. Sources say existing contracts more than cover the current production.
Vietnam: Local media accounts confirm the government is ready to impose an export duty on urea. The move is a compromise among government agencies. The Ministry of Agriculture and Rural Development wanted an outright ban on all urea exports. Eventually the government agreed on the export duty.
Vietnam joins China, its northern neighbor, in using export duties to limit exports of urea and other commodities the governments consider important to their development.
Much of the urea that has been exported from Vietnam has been Chinese product that arrived by land or small boat. Industry watchers in the area have long said the porous border between China and Vietnam provided opportunities for Chinese urea producers to move their product offshore without dealing with the Chinese customs bureau.
The Vietnamese action comes as rising food costs and some shortages are prompting governments to hold on to as much fertilizer and food for its own people as possible.
A final announcement is expected later this month.
NITROGEN SOLUTIONS
U.S. Gulf: Prices for nitrogen solutions were holding steady last week as activity tended to fall. Rice farmers were the most active buyers from warehouses; but, as was the case with urea, some were considering making a switch to ammonium nitrate, which was unusual, according to a source. As has been the case for much of the spring season, rain was a problem in some areas and had a dampening effect on sales.
Prices for the Gulf were running in the range of $405-$420/st, and warehouse prices began to move into the $400/st range on the Arkansas River. Urea will most likely be affected from any desertions to ammonium nitrate, due to the price difference.
A UAN barge was sold for delivery in August at $416/st FOB for 32 percent, which could be a sign of things to come.
Eastern Cornbelt: UAN pricing remained in a broad range, with Illinois sources quoting the low end at $13.50/unit FOB spot river locations and Ohio sources reporting the dealer market for UAN-28 in the $383-$397/st ($13.68-$14.18/unit) FOB range out of river and inland terminals. One supplier was referencing UAN at the $14.50/unit FOB level out of Wisconsin terminals last week.
Western Cornbelt: UAN-32 was pegged in a wide range at $420-$445/st ($13.13-$13.91/unit) FOB regional terminals, with the low reported in Missouri to the dealer.
Northern Plains: The UAN market continued to be quoted at $13.75-$14.50/unit FOB Minnesota terminals to the dealer, with the upper level reflecting dealer postings FOB Winona, Minn., as of May 21. North Dakota sources pegged delivered UAN-28 in a broad range at $430-$450/st ($15.36-$16.07/unit), depending on location and source. One regional supplier was offering forward contract UAN-32 for July through December at the $507.40/st ($15.86/unit) level FOB Pine Bend.
Northeast: The UAN-30 dealer market was pegged at $375-$385/st ($12.50-$12.83/unit) FOB Baltimore, with discounted sales to resellers reported for as low as $368/st ($12.27/unit) FOB. Dealer reference levels were reported at the $394/st ($13.13/unit) level FOB Philadelphia. Out of terminals in upstate New York, the UAN-32 market was quoted at $440-$445/st ($13.75-$13.91/unit) FOB in early June.
Agrium’s UAN postings firmed on June 4 to $13.65/unit FOB Chesapeake, Va., $13.70/unit FOB Bainbridge and Wilmington, N.C., and $13.80/unit FOB Baltimore. The company’s UAN S Solution postings also firmed on that date, with 28 percent moving to $424/st FOB Bainbridge, 25 percent to $373/st FOB Chesapeake, and 24 percent to $360/st FOB Bainbridge, Wilmington, and Chesapeake.
Sources described UAN replacement vessel tons as “through the roof,” with indications of the next round of business in the $480-$485/mt C&F range. As for actual sales last week, however, sources confirmed vessel business in the $430s/mt C&F.
Eastern Canada: The UAN spot market had firmed significantly in the region. Sources tagged the dealer market at $16.69-$17.00/unit FOB Ontario terminals, with most dealer quotes for UAN-28 reported in the $470-$473/mt ($16.76-$16.89/unit) FOB range for new sales. One source reported booking tons in May at $400-$440/mt ($14.29-$15.71/unit) FOB, but those numbers were no longer available.
AMMONIUM NITRATE
U.S. Gulf: Ammonium nitrate barges and warehouse prices were hovering at the $380/st FOB level, except for terminals at Tulsa and Catoosa, Okla., where the price rose from $380/st to $400/st FOB. Because of heavy rains earlier this summer season, farmers in Oklahoma were hitting warehouses in those areas. In general, however, ammonium nitrate trading was light.
In an unusual development, a source said some rice farmers were beginning to consider switching from urea to ammonium nitrate due to the wide spread in the prices of the two products.
Western Cornbelt: Ammonium nitrate remained at $395-$410/st FOB in the region, with continued reports from some sources of growers switching to nitrate instead of UAN or urea due to the price difference.
Eastern Canada: Several sources reported a greater interest in ammonium nitrate this spring due to high urea prices, but others said smaller quantities of nitrate were brought into the region due to cropping changes. Whatever the reason, ammonium nitrate was sold out in most locations and in very short supply in others. The only pricing quote offered last week came from an Ontario source at a firm $582/mt FOB, up significantly from last report.
CAN-27 was also said to be virtually sold out in the region, with the only pricing quote reported at $495/mt FOB on a spot basis in Ontario.
AMMONIUM SULFATE
Eastern Cornbelt: Granular ammonium sulfate was quoted at $365-$375/st FOB in the region.
Western Cornbelt: Granular ammonium sulfate was tagged at $350-$375/st FOB regional terminals, with the upper end reflecting new dealer postings. One Iowa source pegged the dealer market in his location at $365/st FOB last week.
Northern Plains: Granular ammonium sulfate pricing was up in the region. Minnesota sources tagged the dealer market at $375/st FOB, while delivered product in North Dakota covered a wide range at $350-$400/st, depending on supplier. Agrium moved its ammonium sulfate postings on June 2 to $400/st DEL in North Dakota, Minnesota, and Wisconsin. Ammonium thiosulfate was reported at $295/st FOB Winona for straight loads.
Northeast: Granular ammonium sulfate was quoted in a broad range at $330-$367/st FOB, with the upper end FOB Philadelphia to the dealer.
Eastern Canada: Granular ammonium sulfate pricing had reportedly firmed to $440-$455/mt FOB in Ontario, with the upper level reflecting updated dealer postings that went into effect in late May. One source pegged the fine grade sulfate market last week at $275/mt FOB in Ontario.
PHOSPHATES
Central Florida: The Central Florida phosphate market slipped into the summer doldrums last week, and no new prompt sales were made. Railcars were being loaded with product ordered earlier in the season, however. A source said some railcars might be available at around $1,000/st FOB by traders who ordered earlier at prices around $800/st FOB. That price would be considerably lower than what producers were currently asking. The problem was that the spring planting season was virtually over. “By the time railcars from Florida could be delivered, it will be too late” to be used this season, a trader said.
Most of the corn crop was already in the ground last week, although pockets remained throughout the Midwest, where progress was well behind normal due to wet conditions. Those areas will have to be planted very soon, if at all, but more rain was expected late last week.
Adding to the problem of slow sales, dealers apparently were not restocking their empty bins with phosphates – or anything else – due to the high cost of capital. That may be a wise strategy, because prices were likely to stagnate until shortly before the fall season kicks off. That could pose transportation problems in a couple of months, however, if everyone orders at the same time.
The Central Florida DAP price range last week was unchanged from the previous week’s range of $1,025-$1,070/st FOB, based on actual sales at that time. PCS Sales’s Central Florida reference price remained at $1,050/st FOB for DAP. Mosaic’s asking price was still $1,070/st FOB for DAP and $1,095/st FOB for MAP. CF’s price was $1,050/st FOB for DAP and $1,125/st FOB for MAP, which continued to be scarce. In Texas, Agrifos’s prices remained at $1,050/st FOB for trucks and $1,045/st FOB for rail shipments.
U.S. Gulf: Cheaper NOLA DAP barges on the river system appeared to have been eaten by the end of last week, and late week sales were done at higher prices. Many of those less expensive barges became available while the Arkansas River was too difficult to navigate and the vessels became stranded at Rosedale. That river was open, although it was still slow going last week, but terminals fed by the Arkansas had sufficient supplies and few were taking new loads.
Overall, activity was significantly lower last week, and sellers were taking stock of dealers and farmers in their areas. In pastureland areas, phosphate sales were virtually nonexistent this season and even urea was taking a hit. Livestock will not be getting sufficient protein from the grass they eat to get fat enough to be profitable, according to some sources. Ultimately, the price of beef will go up as supplies go down, and then ranchers will have enough money to buy fertilizers again. That will not happen soon, but should eventually.
Margins for traders who flip DAP barges were way down from the profits they enjoyed a couple of months ago. Rather than making $200-$400/st, margins were closer to the old $3-$5/st. Some of the lower-priced barges were the result of traders wanting to get their money back so they would not be damaged by the high cost of interest. Considering it cost around $1.5 million for a DAP barge, it hardly seemed worthwhile.
Based on new prompt NOLA DAP barge sales last week, the price range rose slightly to $987-$1,005/st FOB from the previous week’s $980-$987/st. MAP barges were available at prices $25-$75/st FOB higher than DAP. Mosaic’s asking price for forward sales through August was $1,090/st FOB for DAP and $1,105/st FOB for MAP. CF was seeking $1,070/st FOB for DAP and $1,145/st FOB for MAP for prompt deliveries.
Eastern Cornbelt: The DAP market was pegged at $1,050-$1,107/st FOB regional warehouses to the dealer, with the upper end reported in Ohio and the low in Illinois. MAP was $1,075-$1,113/st FOB, with one Illinois source quoting the common dealer market at the $1,095/st FOB level last week. Both ranges were up slightly from the previous week The 10-34-0 market was quoted in a very broad range at $870-$950/st FOB in the region, where available.
Western Cornbelt: The DAP market was quoted at $1,025-$1,050/st FOB regional warehouses to the dealer. One source tagged the dealer market FOB Missouri River terminals at the $1,035/st FOB level in early June. A regional supplier was referencing DAP at $1,057/st FOB in Iowa for shipment in October through November, and another was referencing forward contract DAP tons at $1,104/st FOB St. Louis, Mo., for July through September.
MAP was reported in a broad range at $1,025-$1,095/st FOB in the region, with pricing out of spot Missouri River warehouses at the $1,065/st FOB level.
10-34-0 remained at $900-$950/st FOB for very limited tons. Simplot announced new phosphoric acid prices effective June 1, with both super phosphoric acid (SPA) and merchant grade acid (MGA) moving up dramatically to $22.50/unit DEL in the company’s Midwest sales area. A $0.50/unit increase is scheduled for July and again in August.
Northern Plains: DAP pricing remained in a broad range at $1,050-$1,100/st FOB Minnesota warehouses to the dealer, with the MAP market quoted at $1,100-$1,125/st FOB the Twin Cities. Forward contract tons FOB Pine Bend were being offered for the July through September shipping period at $1,110/st for DAP and $1,185/st for MAP.
Green 10-34-0 was in very limited supply, with the market quoted at $970-$1,000/st FOB in the region. Black 10-34-0 was pegged at the $850/st FOB level in Minnesota and $880-$890/st DEL in North Dakota, but sources said available tonnage was close to being cleaned up in early June.
Northeast: The regional DAP market was pegged at $1,027-$1,060/st FOB warehouses to the dealer, with MAP quoted at a firm $1,052/st FOB Philadelphia on the low end. The 10-34-0 market was quoted at the $850/st FOB level for limited sales in New York, up significantly from last report.
Eastern Canada: MAP was pegged at $1,325-$1,350/mt FOB Ontario warehouses last week, up again from last report. DAP was quoted at $1,290-$1,315/mt FOB and in short supply, and the TSP market was reported at a firm $1,270/mt FOB in Ontario on a spot basis.
One source said the rapid price increases had prompted some growers in his trade area to inquire about buying phosphate and potash supplies now for the fall, and then using on-farm storage sites to hold the product until it is needed. Such measures were a reflection of the grower concerns about just how high replacement costs might be by the time the fall application season is underway.
Western U.S.: Simplot announced new phosphoric acid prices, effective June 1, with both SPA and MGA moving up dramatically to $23/unit rail-DEL in the company’s western sales area. In addition, the company reposted MGA at $22.50/unit FOB Pocatello, Idaho, for truckloads only. A $0.50/unit increase is scheduled for July and again in August. Simplot also moved up its 10-34-0 price to $935/st FOB Pocatello, with 0-45-0 TSP firming to the $1,000/st mark FOB Pocatello.
In addition, Simplot changed its dry phosphate postings, bringing DAP and MAP to the same level instead of posting DAP at a $15/st premium. As a result, the company’s reference levels for both products are now at $1,145/st DEL in central Montana, $1,150/st DEL in parts of Idaho and Utah, $1,155/st DEL in Washington, Oregon, parts of Idaho, and Nevada, and $1,160/st DEL in California and Arizona.
Agrium also announced new SPA and MGA postings on June 1. Prices for both products moved to $2,300/st rail-DEL in the continental U.S. for the month of June, $2,350/st railDEL in July, and $2,400/st rail-DEL in August. Agrium’s ammonium sulfate postings firmed on June 2 to $400/st DEL in Montana, Wyoming, Idaho, Washington, Oregon, Utah, and Nevada, and $395/st FOB warehouses in Idaho, Washington, Oregon, Utah, and Nevada.
U.S.Export: No new phosphate sales from North America were made last week, as PhosChem appeared to continue holding out of the market in hopes prices will rebound.
India was said to have purchased one vessel, about 35,000 mt of Russian MAP, and was still in the market for additional supplies. Rumor held that Latin America was making buys in the $1,300/mt range delivered. If so, that would put the FOB price around $1,200/mt or slightly higher – not enough to motivate PhosChem or others to get back into the market. Instead, sellers in this country will likely wait until the cheaper Chinese product has been disposed of before getting back to business.
With no new sales, the export DAP price range last week remained at $1,160-$1,205 mt.
POTASH
Eastern Cornbelt: The potash market was tagged at $750-$850/st FOB regional warehouses, depending on grade and supplier. Agrium’s 60 percent coarse potash postings firmed on June 4 to $850/st FOB Mt Vernon, E. Liverpool, and Washington Court House, Ohio.
Western Cornbelt: The potash market was pegged at $750-$830/st FOB for brokered or reseller tons, reflecting yet another increase on the secondary market. The low was reported in Missouri, with the upper end reflecting reference levels for prompt tons out of some Iowa shipping points.
Northern Plains: Potash was quoted at $522-$530/st FOB Saskatchewan mines, depending on grade, with the warehouse market for granular potash pegged at the $800/st mark in Minnesota to the dealer. Agrium’s postings for 60 percent red premium potash for the July 1 forward shipping period include $623/st FOB Shakopee, $616/st rail-DEL in northern Minnesota and North Dakota, and $618/st rail-DEL in southern Minnesota and South Dakota. The company’s potash postings FOB Vade, Saskatchewan, include $585/st for standard grade and $590/st for red premium for July 1 forward.
Northeast: Potash pricing had firmed to $625-$642/st DEL in the region, depending on grade and location, but availability remained the key issue. Several sources said spot tons were simply unavailable last week.
Agrium’s 60 percent coarse potash postings firmed on June 4 to $635/st FOB Wilmington, $650/st FOB Bainbridge and Tifton, Ga., and $850/st FOB E. Liverpool.
Eastern Canada: The potash price at the mine FOB Sussex, N.B., had firmed to $623/mt for the June 1 to Aug. 31 shipping period. Potash pricing out of regional warehouses had also reportedly firmed to $640-$665/mt FOB to the dealer, depending on grade and location, with the upper end for white granular product. Sources also talked of some rail-delivered product coming into Ontario in the $650/mt range. Potash remained in very tight supply.
The K-Mag market was quoted at $435-$457/mt FOB, and sulfate of potash (SOP) was tagged at the $738/mt FOB level in Ontario. Pricing for both products was up significantly from last report.
SULFUR
Tampa: With the summer driving season on the horizon, refineries were said to have increased production to meet the demand, which meant more sulfur was being produced. Don’t get overly excited, though, because sulfur remained in short supply and anything extra generally was already committed under contracts. However, the 90 percent capacity by refiners was significantly better than the normally-hoped-for 80 percent. BP’s Texas City plant was still far from being fully operational last week, and was said to be producing only about 100 lt a day of sulfur.
Railroads will be increasing their fuel surcharges again for July by an average of about $0.07 per mile. CSX was said to be increasing its surcharge by $0.08 per mile from $0.53 to $0.61, which was about 15 percent in a single month. Like all other industries, railroads have been hit hard by rising fuel prices.
The price of sulfur in the Middle East went up another $70/mt FOB for June, up to about $790-$800/mt FOB. Apparently, sulfur has not yet reached its peak. That will have an impact on third quarter prices in this country, which may go up between $150/lt and $250/lt, although no talks – formal or informal – had begun.
The big unknown was what will happen this summer during the hurricane season. If a big one hits Central Florida and its phosphate industry, consumption of sulfur could fall sharply for a period. If any hurricane moves into the Gulf, sulfur transportation to Tampa will be affected, and the shortage would be exacerbated.
Vancouver: Spot sales were said to have been made at $720/mt FOB out of Vancouver. However, spot sales could take a break as maintenance work gets underway on the docks and storage facilities there.
The Fertilizer Institute announced some staff changes last week. Estelle Grasset has been promoted to TFI director of communications, and Sarah Monke has joined TFI as its new public affairs specialist. Grasset will assume the responsibilities previously held by Harriet Wegmeyer prior to her move to the executive director position at the Nutrients for Life Foundation. Grasset will continue to lend communications expertise to TFI’s public affairs team and will take the lead in developing brochures and messaging materials, creating and distributing TFI’s monthly newsletter, and handling media relations. Monke will contribute to the public affairs department’s internal and external communications efforts by producing and distributing TFI’s weekly newsletter and providing support on strategic initiatives. Monke, who joined TFI April 7, previously served in the communications department at CropLife America.
The Agricultural Retailers Association recently announced several staff additions, including Kelly Jones, office administrator/associate director of membership; Jon Samson, deputy director of public policy; and Carmen Haworth, associate director of public policy and counsel. Jones is responsible for day-to-day office administration, database management, and membership support. Samson is responsible for managing legislative policy, the ARA Political Action Committee (ARAPAC) and membership recruitment. Haworth is responsible for managing regulatory policy, and will assist with membership and other association projects.
Jones is a 2007 magna cum laude graduate from the Indiana Institute of Technology with a bachelor’s degree in business administration, specializing in marketing and human resources. Samson previously served as manager of government affairs for the Automotive Recyclers Association, and as a legislative correspondent for Senator Max Baucus (D-Mont.). He also served as assistant to the staff director on Baucus’s Senate Finance Committee staff. Haworth previously served as congressional intern coordinator in the Office of the President at Texas Tech University. She is a law graduate from Texas Tech University, specializing in trade and environmental policy, and holds a master’s degree in agricultural economics from Purdue University.
T.J. (Tim) Hearn has joined Viterra Inc.’s board of directors. He will serve on the board’s audit committee. Hearn served as chairman, president, and CEO of Imperial Oil Ltd. from the time of his appointment in 2002 to his retirement earlier this year. Prior to this, he spent ten years as an executive with Exxon Corp. and Exxon Mobil. A graduate of the University of Manitoba, Hearn began his career with Imperial Oil in 1967.
Brampton, Ontario-The first witness took the stand last week in the trial of a 20-year-old man charged under Canada’s 2001 Anti-terrorism Act for allegedly belonging to a homegrown terrorist cell that tried to purchase three tons of ammonium nitrate in 2006 for use in bombs intended for the Toronto Stock Exchange and offices of the Canadian Security Intelligence Service (GM June 12, 2006). The man, who was a youth at the time of the arrest, is one of 18 individuals who have come to be known as the “Toronto 18,” which prosecutors are describing as an Al Qaeda-inspired terrorist group that was brought down after law enforcement officials conducted a sting operation to facilitate the sale of the AN in June 2006. According to documents filed as an exhibit in court last week, in March, 2006, one of the adults accused in the case ordered three electronic devices that investigators believe could be used to remotely trigger a bomb. A short video was played in court and showed one of the adults charged in the alleged plot triggering a remote control detonator from his cell phone. Prosecutors are also charging that one of the accused visited the Meadowvale Public Library in Mississauga, Ont., and used its computers to search topics such as, “ammonium nitrate turf fertilizer” and “ways of getting ammonium nitrate.” Court documents filed last week also allege that the 20-year-old attended two military-style camps in Ontario in December 2005 and in May 2006, where he wore camouflage, participated in military exercises and was present for what the Crown described as “terrorist indoctrination.” The defense attorney representing the man says his client had nothing to do with the alleged bomb plot.
Beltsville, Md.-A USDA scientist is debunking newspaper reports that biosolid fertilizer used to inactivate lead in lawns put poor neighborhoods in Baltimore at risk without their knowledge. “The reporter has joined with a group of anti-biosolids zealots to stir up trouble,” responded Dr. Rufus Chaney, a research agronomist at Beltsville Agricultural Research Center. “I think any careful examination of the facts will show that we made all needed disclosures to the cooperating families, and the treatments of their lawns significantly reduced soil lead risk to the community.” But Chaney’s rebuttal apparently isn’t changing the mind of Sen. Barbara Boxer, who is determined to hold hearings before the Senate Environmental and Public Works Committee, which she heads as chairman. A spokesman for the committee, who asked not to be identified, told Green Markets that Boxer, D-Calif., is going ahead with the hearings “later this spring or at least by summer” into government funding of the studies that put biosolids on the lawns of East Baltimore rowhouses and a vacant lot near a school in East St. Louis, Ill. The study, by researchers with the Johns Hopkins Bloomberg School of Public Health, apparently was aimed at reducing or eliminating the threat of lead poisoning for neighborhood youngsters. There also were reports that the Maryland NAACP is pressing for a federal or state criminal investigation. Chaney, who is renowned worldwide for developing safe, environmentally friendly techniques to remove trace elements of heavy metals from contaminated soils so that they can’t move into food crops, asserted, “I am concerned that such deliberate anti-biosolids reporting which ignores the science that is being criticized needs to be challenged. We applied Class A biosolids compost from Baltimore, a high-quality soil conditioner product available for sale for all home and garden uses in the region. And the soil treatments did substantially reduce the risk to children from lead in those soils.” He said the yards were chosen because of the high concentration of lead found in poor, African-American neighborhoods where families couldn’t afford the cost of cleaning up the soils. The families all volunteered to be part of the study and were fully informed of every aspect of the research, according to Chaney.
North Sydney-The Supreme Court of Victoria on May 30, 2008, approved Incitec Pivot Holdings Pty Ltd.’s plans to acquire Dyno Nobel Ltd. As a result, the deal will proceed and Dyno Nobel’s shares on the Australian Stock Exchange were expected to stop trading at the close of the day June 2. Dyno Nobel shareholders overwhelmingly approved the deal May 22.
Boise, Idaho-An estimated 2,000 Idahoans paid tribute to J.R. Simplot, the state’s wealthiest resident and the nation’s oldest billionaire, at a special multimedia memorial at the Qwest Arena in Boise on Sunday, June 1. Simplot was 99 when he died at his condominium the previous Sunday, seven months shy of turning 100. The Simplot family paid for all the parking garage spaces that day in downtown Boise to enable the public to attend the memorial. After accidentally discovering the benefits of using fertilizer to grow potatoes during the Great Depression and shipping potatoes and onions to U.S. troops during World War II, Simplot built an agribusiness conglomerate based on phosphate fertilizer mining and production, cattle feedlots, and food processing, whose annual revenues approach $4 billion. He also invested more than $20 million to start and maintain Micron Technology, a Boise-based computer memory chip manufacturer that is Idaho’s largest private employer and taxpayer. Scott Simplot, a son who was named chairman of the J.R. Simplot Company on June 2, said his father’s estate will be divided among heirs, the Internal Revenue Service, and the J.R. Simplot Foundation, which has assets of $135 million, making it Idaho’s second largest charitable institution. Scott Simplot is only the second chairman of the company. J.R. Simplot stepped down as chairman in 1994, when three of his children and a grandchild shared the chairmanship. The Simplot family may develop a few blocks in downtown Boise into a Simplot Agriculture Museum to display J.R. Simplot’s multi-million-dollar collection of antique farm equipment as a tribute to Idaho’s agricultural roots. Twenty-seven McDonald’s fast food outlets in the Treasure Valley gave away free french fries on Monday, June 2, in honor of Simplot, who pioneered frozen french fries and provided McDonald’s with most of its fries. The Simplot family said it does not know what happened to J.R. Simplot’s signature cowboy hat that was included in a floral centerpiece on stage at the memorial. It disappeared after the service. He is survived by his wife, four children, 18 grandchildren, 25 great grandchildren, and one great-great grandchild, born a few weeks before his death.
Lawrence, Kan.-The general manager of a small fertilizer blending plant that has operated in Lawrence, Kan., for nearly 20 years is determined to fight federal water pollution control charges that could mean a $750,000 fine for both himself and the business and up to three years in prison. “When it’s all said and done I am confident that we will land on our feet,” said Raymond Sawyer, the head of MagnaGro International Inc., who has been indicted in federal court with unlawfully discharging waste from a fertilizer manufacturing operation into the Lawrence sewer system. According to press reports, the charges stem from an incident in which water from a waste pit surrounding a fertilizer mixing vat was pumped into a toilet stool. But Sawyer insists that his operations, which mainly involve blending water soluble fertilizers and organic products, never discharged bulk material into the city system. “We have always discharged our wash water or cleanup water but we have never blatantly discharged any mass amount or other material,” Sawyer said. “The city has taken water samples consistently and we have never been out of compliance. Anything that was problematical we saved and used it in another product.” In September 2007, EPA criminal investigation agents showed up with a search warrant. “Now I’m trying to sell each of the pieces and parts of the business,” Sawyer told Green Markets. “We’re winding down operations and won’t exist as of July.” Over the years, Sawyer has developed 56 different liquid blends, some of which he compares with Scott’s MiracleGro, and organic fertilizers along with specialty products including humic acid, calcium, and fermented molasses. He also used to buy urea for a starter fertilizer, which he supplied to crop producers. In the final analysis, he believes the city has bigger plans for the area where he’s been operating since 1990. “An operation like ours doesn’t fit into their plans,” he reasoned. “The city of Lawrence wants us out of there.” Since the federal charges were filed, Sawyer reported, the city “without any due process turned off our water and sewer, forcing us to haul in water.” For a time he hauled in water to fill a storage tank, but realized that he was now in a position where it would be a safety risk to continue operating. “I don’t believe we’re guilty of anything,” Sawyer maintains. His advice to others operating a “ma and pa” business is to “get expert help and stay out of trouble.”
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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.
