U.S. Gulf:
NOLA granular urea barge prices rebounded to $465-$515/st FOB, up from last week’s $410-$470/st FOB range. Sources said much business was done at the week-ago numbers, including barges reportedly loaded for a ship to India. The business significantly cleared out near-term inventories.
The $465-$515/st FOB was done for June and July business. September was reported at $535-$540/st FOB.
Eastern Cornbelt:
Urea pricing was reported at $540-$560/st FOB in the Eastern Cornbelt, up slightly from the previous week as NOLA barge values continued to creep higher.
Western Cornbelt:
Fueled by stronger NOLA barge pricing and topdress demand on rice, urea prices increased to $535-$550/st FOB in the region, up from the prior week’s $480-$540/st range. Prompt offers in St. Louis, Mo., were confirmed at $535-$550/st FOB, while pricing at Catoosa/Inola, Okla., reportedly rose to $550-$590/st FOB, up from $485-$505/st FOB the week before.
Northern Plains:
The urea market was pegged at $550-$570/st FOB St. Paul, Minn., while pricing at Carrington, N.D., reportedly fell to $550/st FOB, down $80/st from levels confirmed in early June. Delivered urea pricing in the Northern Plains was quoted at $545-$610/st, down from $700-$720/st earlier in June.
Northeast:
Urea terminal prices remained under pressure in the Northeast. New offers at Fairless Hills, Pa., were reported at $600/st FOB, down from $725/st FOB in early June.
Eastern Canada:
Urea prices in Eastern Canada were reported in a broad range at C$1,240-$1,465/mt FOB during the week, down some C$135/mt at the low end of the range.
India:
The industry is looking to the next tender to signal how far prices will move. Already, prices in Egypt and Brazil are showing strength.
The next tender is expected sometime in early July. Sources said the buying houses want to make sure all the tons awarded in the last tender have vessels nominated with specific loading dates before calling a new tender. One trader said this is to prevent a producer from backing off on supplying tons in the hopes of getting a better netback in the next tender.
Sources said India will need to buy at least 1.5 million mt to keep up with demand. Anything less, said one trader, could lead to spot shortages during the critical application season.
Black Sea:
There are steady reports of Russian urea being shipped out. However, the deals are being quietly handled, and usually on a delivered basis. As a result, it is not possible to confirm sales or prices out of the region.
Traders and industry analysts give their best estimates, said one trader, but there is nothing to fact-check against.Estimates put the price out of the Black Sea for Russian product around $450/mt FOB.
There are more reports of material coming out of the eastern portion of the Black Sea. Sources said tonnage from Turkmenistan and Georgia is coming out of Poti to the rest of the world. Vessels moving to and from this port hug the southern edge of the Black Sea, along the Turkish coast, to avoid the Russia-Ukraine war zone in the north.
Indonesia:
Sources said producers are anxious to move out tons. The last price of $547/mt FOB is now seen as too high for buyers. Producers are said to be willing to discuss prices in the $520s/mt FOB in an effort to clear out the warehouses.While a lot of talks have taken place, sources said nothing firm was concluded this week.
Middle East:
The talk of new prices from the Arab Gulf continued to focus around $500/mt FOB. However, the lack of any new business leaves the public price at levels settled under the last Indian tender of $685-$690/mt FOB.
There is some pushback against softer prices. This past week saw a steady climb in the Egyptian sales price. The deals were reportedly done through different traders for European end users. The week opened with MOPCO selling 10,000 mt at $665/mt FOB for July shipment. By the end of the week, August deals of 10,000 mt were concluded at $740/mt FOB.
Discussion of prices out of Egypt went silent in late May, when the price hit $720/mt FOB. Reportedly, some quiet deals were done in early June at levels closer to $650/mt FOB. Sources said producers were anxious to keep the drop in pricing quiet and buyers were willing to go along, at least for a while.
However, as June comes to a close, more information was leaking through, prompting buyers and sellers to confirm the prices. For producers, the move in pricing was especially welcome because it showed a swift and firm bounce back.
China:
Sources said they expect to see at least 300,000 mt of Chinese product offered in the upcoming Indian tender. However, they also report mixed signals from the Chinese government that could limit how much of a role Chinese urea will play in that tender.
Domestic prices remain soft, a goal of the government restrictions on exports. Any producer looking to back an offshore deal is required to file a request to export with local customs officials. The company must prove that its sale will not adversely affect supplies of urea for the domestic market, nor cause prices to rise unreasonably.
For its part, the Chinese bureaucracy has been slow processing many of the applications, causing delays in portside loadings.
There are now reports that the government has been quietly telling producers to stop applying for export exemptions. International traders said they have not been able to directly confirm the request, but added that they have been getting reports from their agents in China that the government is not happy with the current rate of exports.
Exports for January-May 2022 were reported at 538,000 mt by Trade Data Monitor. This amount shows the impact of the export restrictions imposed by the central government. Exports for the same period in 2021 were 1.9 million mt. The average monthly amount of urea exported for January-May in 2021 was 389,000 mt, but this year the average was 108,000 mt.
The main buyers for the first five months were South Korea with 138,000 mt, Pakistan with 100,0000 mt in a government-to-government deal, and India with 87,000 mt.
May 2022 exports were reported at 86,000 mt, down from the 601,000 mt exported in May 2021. South Korea took about one-third of the total exports with 29,000 mt.
Brazil:
Prices appeared to have found their floor and are rebounding. Sources now quote the price at $600-$650/mt CFR. Even before the week closed, sources were saying that the new price was closer to $700/mt CFR. However, no deals were confirmed at that level as Green Markets went to press.
The move up in prices came on the heels of reports of higher prices out of Egypt and an increase in U.S. NOLA prices. Anticipation of India buying at least 1.5 million mt, at the same time that Brazilian buyers will be looking for urea, seemed to add to the push for higher prices.
Inland distributors reportedly pulled their price reference sheets as prices moved beyond earlier expectations. The move also came as sources reported limited business out of Rondonópolis. The price, based on the limited business, was reported at $800/mt FOB e-warehouse.