US Gulf:
NOLA urea prices continued to fall during the week, with new trades reported in the $323-$335/st FOB range for November-December barges, down from last week’s $340-$350/st FOB range. There were also reports of brokered tons trading for as low as $313/st FOB for January.
US Imports:
Urea imports for September moved 6.3% higher year-over-year, to 268,347 st from 252,481 st. July-September imports softened 11.1%, however, to 509,322 st from 572,716 st in 2022. July-September imports from Russia totaled 186,090 st, Qatar sent 109,128 st, and Canada shipped 82,925 st.
US Exports:
July-September urea exports totaled 255,831 st, down 58.4% from the year-ago 615,399 st. September exports fell 50.4%, to 105,094 st from the prior-year 212,080 st. Exports to Canada totaled 85,937 st in July-September, followed by 76,956 st to Chile and 69,814 st to Mexico.
Eastern Cornbelt:
Urea slipped to $405-$435/st FOB in the Eastern Cornbelt, with the low confirmed at Ottawa, Ill., and LaSalle, Ill., for November-December tons. The Cincinnati, Ohio, market was quoted at $405-$410/st FOB, while pricing out of Michigan warehouses was reported in the $445-$465/st FOB range.
Western Cornbelt:
Urea remained in a broad range at $395-$440/st FOB in the Western Cornbelt, with the low reported at St. Louis, Mo., and the high in Iowa on a spot basis.
Northern Plains:
Urea prices were under pressure in the Northern Plains. The St. Paul, Minn., market was down to $410/st FOB for the latest offers, below the prior $430/st level. Delivered urea was reported at $430-$470/st in the region, with the low confirmed for unit trains, down from the previous $480-$510/st DEL range in the region.
Northeast:
The latest urea pricing in the Northeast was reported at $432-$440/st FOB for November-December, down from last week’s $440-$450/st FOB and the $460-$470/st FOB range reported in late October.
Eastern Canada:
Urea pricing in Eastern Canada narrowed to C$710-$725/mt FOB in mid-November, down from the previous high of C$745/mt FOB in late October.
Black Sea:
The downward push on urea prices has hit the Black Sea region. Sources now put the price for prilled urea at $330/mt FOB.
India:
Sources in Asia are firm in their expectations that India’s next urea tender will not come until after the Indian Potash Ltd. (IPL) tender’s Dec. 20 shipping deadline has passed, and possibly not until mid-January 2024.
After buying about 1.7 million mt in the IPL tender, India has become more comfortable with its estimated urea supply. The timing of the next tender will depend on how many tons farmers order for their 2024 needs, sources said. Unexpectedly high demand took the government by surprise in 2023, increasing the pressure to buy large quantities in each tender. Barring any major shift in demand, sources believe India will need to purchase 1.0-1.5 million mt in the next tender.
One argument for waiting until mid-January, said one trader, is that the bulk of the purchases might arrive after the April 1 start of the new fiscal year, deferring payment to the 2024/25 budget. At the end of each fiscal year, India’s urea buying houses are often limited on what they can take due to restrictions from the treasury.
Pakistan:
The government previously authorized Trading Corporation of Pakistan Ltd. (TCP) to secure more urea, leading the company to call two tenders for 100,000 mt each. So far, little information has been reported about either tender.
The first tender closed on Oct. 31 with few reported offers. No data regarding tonnage or prices offered have been made available. Sources noted reports of recent freight market inquiries for urea shipments to Pakistan, however, leading traders to think some arrangement has been made.
The second tender closed this week, also with few details revealed. Aditya Birla may have submitted the lowest offer at $389/mt CFR for the full 100,000 mt, reports suggested, translating to a netback of around $360/mt FOB if the tonnage ships from China.
The current limits placed on Chinese exports have led sources to think the tons will come from the Arab Gulf, however, or possibly Vietnam.
Bangladesh:
A Bangladesh Chemical Industries Corp. (BCIC) tender for two lots of 50,000 mt of bagged granular urea closed on Nov. 14. Sources said BCIC received only one offer for one lot.
Aditya Birla reportedly offered two cargoes of 25,000 mt each at $498-$506/mt CFR bagged. When the tender was initially called, sources thought the material would come from China. Now, with Chinese export restrictions in place, sources named Vietnam as the most likely supplier.
Indonesia:
Pupuk closed a tender offering 5,000 mt of prilled urea on Nov. 15. Sources originally said Pupuk received one confirmed bid at $350.80/mt FOB, though a second bid may have been submitted in the $360s/mt FOB, said one trader as Green Markets went to press.
Even if the winning bid lands in the $360s/mt FOB, the price will fall significantly below the last bit of prilled business. The country’s last tender closed at $387/mt FOB in October.
Sources speculated that no more granular urea will be offered until 2024. One trader said the general feeling is that Pupuk has used up all of its granular export allotments for 2023. Even when new allotments are issued for the next year, exports are unlikely to commence until March 2024, after the government ensures a plentiful supply for the domestic market. Indonesia’s first-quarter exports are traditionally the lowest of the year.
Middle East:
The offers into the Ethiopian Agricultural Businesses Corp. (EABC) tender indicated a price of $375/mt FOB for December shipment. The price was up for January, to $382-$383/mt FOB. While no award has been issued in the EABC tender, sources said buyers will most likely accept the Arab Gulf material being offered for December and January.
The December material was offered by Fertiglobe out of the UAE. Other tons offered to Ethiopia include two cargoes from Saudi Arabia for January, March, and April loadings.
Producers are currently focused on fulfilling orders related to the IPL/India tender. Both buyers and sellers are nervous about putting forward a firm price for new business due to the shifting nature of the market. The producers seem more interested in formula-based arrangements rather than entertaining any straightforward spot deals.
Egyptian producers have stepped away from their small deals into Europe and appear to be focused on supplying material for the EABC/Ethiopia tender. Sources said small lots were being offered into Europe at sub-$370/mt FOB levels, but with nothing confirmed at press time.
At the same time, at least five 50,000 mt cargoes of granular urea were offered into Ethiopia for delivery through May 2024. Egyptian product was offered at $387-$397/mt FOB for January shipment, a small slide in prices, but one that sources said fits with the general trend of the market.
Egyptian producers have become a major supplier to Ethiopia. So far this year, Ethiopia has taken 402,000 mt from Egypt, accounting for 66% of its urea imports.
China:
Sources said only small lots of 5,000-10,000 mt are now being approved for export from China. The return to export limitations came as the government sought to keep domestic urea prices down by forcing a buildup of large reserves in local warehouses.
The decision to restrict exports does not seem to have impacted any of the larger lots that were previously approved for export to India. However, tonnage that was not already cleared when the restrictions kicked in last week will not be permitted to ship, said sources.
The price for exported material has not been greatly affected. Prilled urea remains centered at $370/mt FOB, sources said, with deals reported on either side, while granular urea remains in the upper-$370s/mt FOB. Discussions for prilled deals were reported at $360/mt FOB and granular at $365/mt FOB, but so far nothing has been confirmed at those levels.
The export restrictions have reduced the quantities expected to ship to India under the IPL tender. Shortly after the tender closed in October, industry watchers estimated that 300,000 mt or more could be sent. Now, sources said India will be lucky to receive 100,000 mt from China.
India’s loss of Chinese tonnage could be seen as a gain for other producers. Some traders that had their Chinese product blocked from shipping have already approached Vietnamese suppliers, sources said. However, the slower loading process in Vietnam may bring traders uncomfortably close to the tender’s Dec. 20 shipping deadline, one trader noted.
ETG of Dubai has reportedly included three cargoes of Chinese product in its March, April, and May offers in the Ethiopian tender. Sources said the move makes sense, as many expect the export restrictions to be eased by the second quarter of 2024.
Ethiopia:
The EABC tender, for 562,000 mt to be delivered through May 2024, closed on Nov. 14. Seven companies offered tons in 11 lots of 51,000 mt each. The offers were all priced on an FOB basis, with bagging costs included. Shipment will reportedly be handled by EABC.
Fertiglobe offered tons from the UAE at $375/mt FOB into the first lot for December shipment, while Indorama offered material at the same price. Due to the lower freight rates available from the Arab Gulf compared to West Africa, sources expect Fertiglobe to get the award.
The second lot, for January shipment, had offers from Indorama at $375/mt FOB, Saudi Arabian material offered by ETG at $383/mt FOB, and Samsung – backed by an Egyptian producer – at $387/mt FOB. The freight advantage from Saudi Arabia over Nigeria will likely give ETG the award, sources speculated.
The rest of the lots showed low offers from ETG, with sources ranging from China, Egypt, and Saudi Arabia.
| Lot | Shipping Month | Offering Company | US$/mt FOB | Source |
| 1 | December | Fertiglobe | 375.00 | UAE |
| Indorama | 375.00 | Nigeria | ||
| 2 | January | ETG | 382.61 | Saudi Arabia |
| Indorama | 375.00 | Nigeria | ||
| Samsung | 387.17 | Egypt | ||
| 3 | January | ETG | 397.28 | Egypt |
| 4 | February | ETG | 377.75 | Saudi Arabia |
| 5 | February | ETG | 397.28 | Egypt |
| 6 | March | ETG | 387.26 | China |
| 7 | March | ETG | 387.56 | Egypt |
| 8 | March | ETG | 382.60 | Saudi Arabia |
| 9 | March | ETG | 376.77 | Egypt |
| 10 | April | ETG | 376.56 | China |
| 11 | May | ETG | 397.28 | China |
Brazil:
Urea import prices in Brazil fell 5.4%, to $345-$360/mt CFR from last week’s $365-$380/mt CFR. Players are estimating a 15-25% reduction in safrinha demand due to low corn prices and dry weather in the north, and excessive rains in the south.
The Rondonópolis market continued to lose traction due to slow demand. Pricing was noted at $510-$530/mt FOB ex-warehouse, below last week’s $520-$535/mt FOB, with most offers landing toward the bottom of the range.