US Gulf:
NOLA urea barge prices rebounded to $470-$495/st FOB, up from the week-ago $451-$485/st FOB. Sources attributed the uptick to the lack of seller activity; if you needed a barge, you had to pay up.
Eastern Cornbelt:
Urea terminal prices remained under pressure. Offers in the Eastern Cornbelt ranged from $540-$580/st FOB at midweek, depending on location, down from the previous week’s $570-$590/st FOB range. The same broad range was reported for new offers at Cincinnati, Ohio, during the week.
Western Cornbelt:
Urea prices continued to decline in the Western Cornbelt, falling to $540-$580/st FOB, with the low confirmed at St. Louis, Mo., and the high in Iowa.
Northern Plains:
Urea prices in the Northern Plains dropped to $570-$590/st FOB, with the low at St. Paul, Minn., and the high reported at Carrington, N.D. The last delivered offers in the North Dakota market were confirmed in the $670-$690/st range.
Northeast:
The latest urea prices in the Northeast were confirmed at $590/st FOB Fairless Hills, Pa., while new offers in the South Central region slipped to $550/st FOB Convent, La. Delivered urea was pegged at the $650/st level in central Pennsylvania, down from $675/st DEL in mid-November.
Eastern Canada:
Urea pricing in Eastern Canada remained at C$1,060-$1,120/mt FOB in early December, although some sources said there is “lots of speculation” about cheaper tons out of NOLA “affecting our market.”
India:
Expectations of a mid-December urea tender have been pushed back. Sources now speculate the tender will most likely be called closer to the last week of the month. Prices for the next tender are expected to move down from the $573-$579/mt CFR secured in the last tender, with some sources speculating that the price could settle in the $540s/mt CFR.
Some have argued the tender will be called in January because it will take that long to line up the financing for the purchase. One international trader said while finances are always a determining factor in the timing of a tender, politics also enters into the discussion. The results of state elections that took place during week could make calling a tender more important to the national ruling party, sources said.
Media reports showed the BJP, the national ruling party of Narendra Modi, maintained its control of Gujarat, but lost control of Himachal Pradesh to the Congress Party. Sources speculated that a poor showing by the BJP could push the national government to curry favor with farmers by calling a tender sooner than needed.
Sources expect the next tender to seek between 700,000 mt and 1 million mt. The urea purchased under the new tender will move Indian reserves back to normal levels for the start of the next application season.
The vessel lineup for December showed 908,000 mt slated for unloading through Dec. 18. The tonnage is most likely tied to the IPL October tender, which had a shipping deadline of Dec. 5. Urea from the RCF tender that closed in November is expected to begin arriving in late December due to its Dec. 22 shipping deadline. The RCF tender secured 1.47 million mt of urea.
Middle East:
Sources reported growing talk of prices in the $490s/mt FOB, but with no sales to back up that talk.
Earlier in the week Pakistan awarded 33,000 mt to Swiss Singapore at $551/mt CFR, which was calculated to net back in the low $520s/mt FOB to the Arab Gulf. This would drop the price from the $550s/mt FOB earned from the RCF/India tender in late November.
Producers have no need to talk with traders about spot tons. Sources said they are sold out into January because of the Indian tenders and their long-term contracts, and Arab Gulf producers also expect to be the prime suppliers in the upcoming Indian tender. Sources noted that China and Russia will have limited tons available for the tender, leaving the Arab Gulf as the only large-scale suppliers available.
Sources reported more inquiries into Egypt for European purchases. The European market still reportedly lacks about 25% of its supply for the upcoming season. At the same time, sources said Egyptian buyers are still looking for buyers for late December and early January loadings. Buyers are looking for bargains just as the Egyptian producers are looking to at least hold the line from their last set of sales in the $560s/mt FOB, and even pushing for the $570s/mt FOB for January.
Pakistan:
Swiss Singapore received an award for 33,000 mt at $551/mt CFR under the TCP tender that closed in late November. Sources said the urea will most likely come from an Arab Gulf supplier with an estimated netback in the low-$520s/mt FOB.
The deal lifts recent purchases to 193,000 mt, out of the 300,000 mt authorized by the government. After an earlier failed tender, TCP secured 125,000 mt from China and 35,000 mt from Azerbaijan, both under government-to-government deals.
Sources are now waiting to see if TCP will continue to find ways to secure the remaining tonnage it was ordered to buy, or if new estimates by the government will forestall any future purchases.
China:
Small deals with South Korea buyers showed a netback of $505-$510/mt FOB. The deals came after the awards were issued in the last Indian tender, when the netback was put in the $550s/mt FOB. Sources were not surprised by the lower price, noting that talks with every urea producer were at levels well below the last bit of business done with India.
Sources expect limited tonnage available from China for the next Indian tender, under which shipment will most likely be for January. Chinese producers typically withhold product from the international market in the first quarter to help build up domestic reserves. This tradition, along with the existing restrictions on exports, has led international traders to speculate China will not be a player in the urea market for a while.
Turkey:
Urea imports for January-October were reported at 1.98 million mt by Trade Data Monitor, down 7% from 2.1 million mt noted for the same period of 2021. The main suppliers were Oman with 1.2 million mt, and Turkmenistan with 219,000 mt.
October 2022 imports totaled 343,000 mt, a dramatic increase from 130,000 mt imported in October 2021. Oman topped the import list with 293,000 mt, representing 85% of imports.
Indonesia:
Exports of urea for January-October 2022 were reported at 1.6 million mt by Trade Data Monitor, off 10% from the year-ago 1.8 million mt. Sales of 338,000 to Australia and 336,000 mt to India dominated the market.
October 2022 exports were reported at 165,000 mt, up from the 113,000 mt exported in October 2021. India accounted for 34% of the market with 56,000 mt, while Mozambique’s 43,500 mt total represented 26% of exports.
Brazil:
Buyers keep pushing for lower prices – and keep getting their wish. Sources in Brazil reported the latest price at $510-$530/mt CFR, while a trader outside Brazil called the steady drop in prices “crazy,” noting that even sanctioned material from Iran should reflect a higher price.
A general lack of buyer interest was said to be the main reason for the price drop. This attitude is showing up in limited imports and sporadic buying inland. The Rondonopolis price came off about $10/mt to $710-$725/mt FOB ex-warehouse, largely because of this malaise in the market.
Urea imports for January-November were reported at 6.5 million mt by Trade Data Monitor,down9% from the 7.1 million mt imported during the same period in 2021. The market’s top suppliers were Oman with 1.4 million mt; Qatar with 1.3 million mt; Nigeria with 1.1 million mt; and Russia with 1 million mt.
November 2022 imports were reported at 716,000 mt, off from 853,000 mt imported for November 2021. Oman accounted for 27% of the imports with 195,000 mt, while Qatar supplied 185,000 mt for 26% of the imports. Nigeria accounted for 23% of the import market with 162,000 mt.
Ethiopia:
Imports of urea for January-November were reported at 457,000 mt by Trade Data Monitor, off 14% from 531,000 mt sent through the same period of 2021. Egypt was the market’s largest supplier with 355,000 mt, followed by the United Arab Emirates with 100,000 mt.
November 2022 imports totaling just 301 mt were not unusual for this time of year. Most imports to Ethiopia land during the first and second quarters of the year.
Black Sea:
The pricing in the area is mixed. There are reports of bids at $500/mt FOB, with counteroffers at $530/mt FOB. These deals seem to be related to product out of the far eastern part of the Black Sea.
At the same time, Russian product is reported being sold in the $470s/mt FOB. The current range is pegged at $470-$485/mt FOB.