U.S. Gulf: Prompt potash barges that were ready to move were called $223-$225/st FOB for the week. However, players willing to wait a week or two could get a better deal, with $218/st FOB reported.
Buyers were reportedly bidding $205/st FOB for late April/early May barges.
Eastern Cornbelt: Potash was unchanged at $245-$265/st FOB in the Eastern Cornbelt, with the low reported out of spot river locations and the upper end at inland warehouses. Several sources put the common warehouse pricing level at $250-$255/st FOB at mid-month, with reports of steady potash movement taking place in the region.
Western Cornbelt: Potash was steady at $245-$265/st FOB in the Western Cornbelt, depending on location. Although sources continued to quote the low end of the market out of St. Louis, some contacts said $250/st FOB was a more common pricing level out of that location at mid-month. Brisk potash movement was reported in the region, thanks to more favorable weather conditions.
California: The California potash market was pegged at $390-$400/st FOB and $395-$405/st rail-DEL for Canadian tons, with the low for red and the upper end quoted for 62 percent white granular potash. There were reports earlier in the month of imported tons available for as low as $350/st FOB on a spot basis, but several sources described this as low-quality product that was attracting little business, and therefore not a true reflection of the market.
Sulfate of potash (SOP) had reportedly firmed to $580-$610/st FOB in the state, depending on grade, with reports of tight supplies in early April.
SOP Magnesia was quoted at $308-$310/st FOB in California.
Crystalline potassium nitrate remained at $830/st FOB for bulk tons and $920/st FOB for 50-pound bags.
Pacific Northwest: Potash was steady at $338-$350/st FOB warehouses in the Pacific Northwest, with rail-DEL tons quoted in the $348-$358/st range. Potash postings FOB mine locations at Moab and Wendover, Utah, remained at $290/st for 60 percent granular and $285/st FOB for 60 percent standard.
The sulfate of potash (SOP) market was quoted at $565-$570/st FOB in the Pacific Northwest, with delivered tons pegged at the $580/st level in parts of Washington. Sources said supplies remained tight.
SOP Magnesia was quoted at $305-$325/st FOB in the region, depending on location, with delivered tons reported in the $330-$340/st range.
Western Canada: Potash was quoted at $325-$335/mt FOB Saskatchewan mines, down some $5/mt from last report, depending on grade. Warehouse pricing in Western Canada remained in the $345-$365/mt FOB range, depending on location.
India: Imports of potash for direct application in fiscal 2016/17 (April 1-March 31) reached 3.74 million mt, some 15 percent more than the 3.24 million mt imported in the previous year. Deliveries from both Canada (Canpotex) and Israel (ICL) in particular were sharply up year-on-year at the close of the fiscal year.
Indian potash1 imports by loading port country
| ‘000 mt | Fiscal 2016/17 | Fiscal 2015/16 | % change |
| Canada | 758 | 499 | +52 |
| Israel | 706 | 400 | +77 |
| Russia | 678 | 912 | -26 |
| Lithuania | 489 | 491 | -0.4 |
| CIS (excluding Russia & Uzbekistan) | 541 | 427 | +27 |
| Jordan | 485 | 378 | +28 |
| Germany | 55 | 106 | -48 |
| Uzbekistan | 24 | 30 | -20 |
| TOTAL | 3,736 | 3,243 | +15 |
1 Potash for direct application and includes contract volumes and tons bought under tender
Data Source: Department of Fertilizers
Indian potash1 imports by offtaker
| ‘000 mt | Fiscal 2016/17 | Fiscal 2015/16 | % change |
| IPL | 1,876 | 1,420 | +32 |
| IFFCO | 620 | 567 | +9 |
| ZIL | 404 | 365 | +11 |
| Chambal | 169 | 128 | +32 |
| CIL | 120 | 65 | +85 |
| PPL | 115 | 111 | +4 |
| MCF | 74 | 97 | -24 |
| TCL | 72 | 67 | +7 |
| RCF | 71 | 251 | -72 |
| Mosaic | 71 | 27 | +163 |
| MCFL | 59 | 0 | – |
| Deepak | 33 | 32 | +3 |
| MFL | 28 | 20 | +40 |
| FACT | 24 | 0 | – |
| Shriram | 0 | 63 | – |
| Kribhco | 0 | 30 | – |
| TOTAL | 3,736 | 3,243 | +15 |
1 Potash for direct application and includes contract volumes and tons bought under tender
Data Source: Department of Fertilizers
The 20 percent reduction in the potash subsidy to Rs12.395/kg ($191.61/mt) for fiscal 2017/18, which was announced on March 31 (GM April 7, p. 17), could well impact demand if Indian fertilizer companies raise retail prices to farmers to offset the subsidy reduction.
Much depends on at what level the new annual contract price is settled at with international suppliers, although IFFCO, India’s largest producer of fertilizer, said last week that it would not raise any prices for DAP and NPK phosphate fertilizers to farmers even after the new revised and reduced subsidy rates. Some Indian industry officials had previously said they doubted that potash imports would exceed 4 million mt in fiscal 2017/18 if the subsidy cut went through. At the time, a subsidy cut of 17 percent was widely anticipated.
Certainly, the subsidy reduction will give weight to Indian potash import buyers’ push for a lower price in their contract negotiations with international suppliers.
No awards are reported to have been made under RCF’s March 31 tender for 75,000 mt of potash or National Fertilizer Ltd.’s (NFL) outstanding tender for 35,000 mt. Sources said RCF received two offers under its tender, both from MMTC, with one backed by BPC and the other by Uralkali, but price offers have still to be opened. MMTC separately tendered for the supply of 75,000 mt.
Offers under RCF’s tender are requested to remain valid for 30 days from the tender closing date, and the delivery window for the shipments of 30,000 mt of pink material to Krishnapatnam and 45,000 mt of white potash to Mundra was extended from the original first-half April request.
China: Suppliers were hopeful of a new round of contract negotiations getting under way with the Consortium of Chinese buyers (Sinochem, CNAMPGC, and CNOOC).
Supplier-side sentiment remains supportive of securing price increases. Canpotex CEO Ken Seitz said this week that the Canadian potash export organization is not interested in “some kind of ratcheting down,” and is looking for Chinese buyers to pay a “material price increase” in their annual supply contract, according to a Reuters report. Seitz cited a much-improved global market from a year ago, with spot price gains and supply cuts by some producers. He did not, however, specify the actual price increase Canpotex was seeking in China.
The Mosaic Co., speaking at its 2017 Analyst Day on April 12, said it also believes there is room for further potash price appreciation. Although the comment wasn’t specifically directed at the Chinese market, Mosaic said it does see “upside potential” in the country’s potash use.
Certainly, some analysts appear less bullish. BMO analyst Joel Jackson in an April 4 client note factored in a $5/mt price increase in China and a similar increase in India, which would take the annual contract price to $224/ mt CFR.
It has been past practice for the first contract to set the benchmark price for other suppliers to follow. For the past two years, Belarusian Potash Co. (BPC) has surprised its competitors by reaching a deal with China first.