US Gulf:
NOLA urea firmed to $304-$310/st FOB for reported January business and $310-$320/st FOB for February, above last week’s $300-$312/st FOB range for January-February trades. March indications, while too far out for inclusion in this week’s published range, were quoted at the $320-$325/st FOB level.
Sources said the firming trend was fueled in part by expectations that India might take advantage of lower offers in its latest tender and book higher volumes than expected, potentially tightening global supply.
US Imports:
November urea imports stood at 319,890 st, down 43.3% from the 563,686 st posted last November. July-November volumes softened 4.2%, to 1.28 million st from the year-ago 1.33 million st. July-November imports from Russia were 436,322 st, while Qatar sent 272,947 st. Saudi Arabia shipped 195,037 st, ahead of Algeria’s 140,284 st and Canada’s 138,620 st.
US Exports:
Urea exports fell 19.0% in November, to 54,846 st from 67,750 st in November 2022. July-November totals dropped 52.4% year-over-year, to 366,081 st from 769,233 st. Exports to Canada totaled 189,311 st in July-November, followed by 76,974 st to Chile and 74,966 st to Mexico.
Eastern Cornbelt:
The urea market rebounded to $365-$380/st FOB in the Eastern Cornbelt in the wake of slightly higher NOLA values, up $5-$10/st from last week. Spot pricing included $370-$375/st FOB Cincinnati, Ohio, and Ottawa, Ill.
In the Great Lakes region, Michigan urea prices were reported at $385-$395/st FOB and $400/st DEL for January-February tons.
Western Cornbelt:
Urea was quoted at $360-$385/st FOB in the Western Cornbelt, with the low confirmed at St. Louis, Mo., and the high in Iowa on a spot basis. The St. Paul, Minn., urea market was pegged at $375-$385/st FOB during the week.
Southern Plains:
Urea prices in the Southern Plains were reported in the $365-$385/st FOB range during the week, depending on location and time of shipment, with the low confirmed at Catoosa/Inola, Okla.
South Central:
Urea slipped to $350-$385/st FOB in the South Central region, down slightly from the prior week’s high of $390/st FOB. The low was confirmed at Convent, La., with most river terminals in Tennessee, Arkansas, and Kentucky falling in the $370-$385/st FOB range, depending on location.
Southeast:
Urea prices were down slightly in the Southeast, to $370-$380/st FOB port terminals from the prior $375-$385/st FOB range, with the low reported at Wilmington, N.C.
India:
The prices in the National Fertilizers Ltd. (NFL) tender were released during the weekend with a Jan. 9 deadline for accepting the counterbid. Twenty companies offered a total of 2,722,800 mt. Of that amount, one company, RE Energy and its offer of 50,000 mt, was disqualified. PIC offered its 45,000 mt directly on an FOB basis.
Agri Commodities had the lowest offer for an East Coast delivery, for 35,000 mt at $329.40/mt CFR. Fertcom was the lowest offering firm for the West Coast with 50,000 mt at $316.80/mt CFR. The prices represented a drop of $76-$84/mt from the October 2023 Indian Potash Ltd. (IPL) tender, and were the second lowest prices offered in an Indian tender since 2021.
| Offering Company | Total | West Coast | East Coast | ||
| Quantity (mt) | Quantity (mt) | $/mt CFR | Quantity (mt) | $/mt CFR | |
| Fertcom | 100,000 | 50,000 | 316.80 | 50,000 | 335.00 |
| Agri Commodities | 106,000 | 71,000 | 322.00 | 35,000 | 329.40 |
| Aditya Birla Group | 479,000 | 295,000 | 326.00 | 184,000 | 333.75 |
| Midgulf | 300,000 | 150,000 | 346.11 | 150,000 | 348.11 |
| Samsung | 270,000 | 180,000 | 331.70 | 90,000 | 341.20 |
| FertiStream | 180,000 | 100,000 | 347.00 | 80,000 | 353.00 |
| OQ Trading | 150,000 | 105,000 | 325.00 | 45,000 | 345.00 |
| Continental | 145,000 | 95,000 | 324.50 | 50,000 | 331.85 |
| Dreymoor | 121,500 | 45,000 | 337.00 | 76,500 | 343.00 |
| Aries | 100,000 | 50,000 | 359.25 | 50,000 | 357.52 |
| Keytrade | 100,000 | 100,000 | 343.50 | ||
| MacroSource | 100,000 | 50,000 | 347.47 | 50,000 | 351.47 |
| Sun International | 100,000 | 100,000 | 342.15 | ||
| Koch | 95,000 | 47,500 | 340.40 | 47,500 | 349.80 |
| Ameropa | 94,300 | 47,150 | 349.50 | 47,150 | 355.50 |
| Fertiglobe | 90,000 | 45,000 | 324.00 | 45,000 | 331.00 |
| Medallion | 50,000 | 50,000 | 331.00 | ||
| Indagro | 47,000 | 342.00 | 347.00 |
The final awards in the tender came to 647,000 mt, with 497,000 mt going to East Coast ports and 150,000 mt for West Coast deliveries. The shipping deadline for the awards is Feb. 29.
| West Coast: $316.80/mt CFR Total: 150,000 mt | |
| Offering Company | Quantity (mt) |
| Aditya Birla Group | 50,000 |
| Fertcom | 50,000 |
| Medallion | 50,000 |
| East Coast: $329.40/mt CFR Total: 497,000 mt | |
| Offering Company | Quantity (mt) |
| Aditya Birla Group | 184,000 |
| Samsung | 90,000 |
| FertiStream | 50,000 |
| Continental | 48,000 |
| Fertiglobe | 45,000 |
| OQ Trading | 45,000 |
| Agri Commodities | 35,000 |
The $13/mt difference between the East Coast and West Coast port pricing is well above the usual $5-$8/mt differential, sources said. As a result, Arab Gulf producers can realize a better netback delivering their product to the East Coast. Sources said the 150,000 mt going to West Coast ports now appears to be sourced solely from Russia.
The final awarded amount is not too far off from the market’s expectations leading up to the tender closing. Sources predicted the final take in the 600,000-800,000 mt range, with some suggesting that at the right price, NFL might take 1 million mt.
The lower amount was expected largely because the tender was seen more as an effort to build a buffer stock. Reserves were reported at a near-record 7 million mt leading up to the tender, leaving traders to speculate that few tons would be needed to start the next season.
Black Sea:
Russia reportedly has about 400,000 mt of prilled urea available for export in January and February. Sources said the 150,000 mt awarded for West Coast deliveries into India are all expected to come from Russia.
The estimated netback for Black Sea prills from the Indian tender was put in the $240s/mt FOB, though some sources saw the market in the $250s/mt FOB. However, with freight rates to India’s West Coast seen in the $70s/mt, this higher level seems unlikely. Lower freights could be tied to demand from Turkish buyers looking for granular product to cover shorts, though freight costs from some larger cargoes, possibly destined for Ethiopia, pushed netbacks down again.
The current netback could change, said sources. The growing number of attacks on cargo vessels in the Red Sea by Houthi militants has driven some vessel operators to forego traveling through the Suez Canal and Red Sea in favor of the longer and more expensive trip around the Cape of Good Hope. So far, no fertilizer vessels have been attacked, sources said, but that could change.
If ships from the Black Sea are forced to take the longer route, the freight costs could increase by $10-$15/mt, sources indicated, which would most likely have to come from the producers’ side. Producers are already reluctant to go below $240/mt FOB, players noted, despite growing pressure from European and African buyers.
Indonesia:
Prices from the Pupuk tender that closed last week settled a few dollars above the previous tender. Ameropa secured 12,000 mt of prilled urea and 45,000 mt of granular at $324/mt FOB, sources said. The last tender came in at $321/mt FOB.
Discussions are reportedly still in progress for additional tons at the $324/mt FOB level. Sources noted that with Chinese urea exports on hold for the next several months, regional buyers now seem willing to accept the premium prices that are often associated with Indonesian product. The latest price will also keep Indonesian product out of reach in the Indian tender, ensuring sales to other buyers.
Middle East:
The $320/mt FOB offer from PIC into the Indian tender was seen by some traders as the price floor for Arab Gulf producers. The netback from the East Coast of India was put at $306-$310/mt FOB. At the same time, other deals were reported at $315-$317/mt FOB.
The price differential between India’s East and West Coast offers provided producers an opportunity to eschew the closer and lower prices typically enjoyed by West Coast ports. Normally the gap between the two Indian coasts is $5-$8/mt, providing little difference in netbacks. However, the $12/mt difference in the current tender allowed producers to keep their prices above $300/mt FOB.
While producers were enjoying their good fortune in the Indian tender, sources reported sales from two producers that showed stronger pricing ideas being accepted by buyers. Oman reportedly sold a cargo for February shipment at $315/mt FOB. SUICI, also from Oman, was said to sell a February cargo at $317/mt FOB.
It was also a good week for Egyptian producers, starting with a 6,000 mt sale at $336/mt FOB, slightly below the area’s last-done business. By Thursday, four producers announced small-lot sales totaling 73,000 mt. Pricing laddered higher with each sale, culminating in business concluding at $375/mt FOB.
| Producer | $/mt FOB | Quantity (mt) |
| MOPCO | 336.00 | 6,000 |
| 338.00 | 7,000 | |
| 340.00 | 6,000 | |
| 345.00 | 6,000 | |
| 360.00 | 6,000 | |
| 375.00 | 6,000 | |
| KIMA | 337.00 | 6,000 |
| Abu Qir | 350.00 | 6,000 |
| 352.00 | 6,000 | |
| 358.00 | 10,000 | |
| Helwan | 360.00 | 8,000 |
These small lots were sold in addition to the larger cargoes already booked for shipment to Ethiopia to cover awards from that country’s most recent tender. The week’s demand for the smaller lots appeared to come from buyers for Turkey and Southern Europe looking to cover shorts.
China:
No new urea cargoes were reported leaving the country, sources said. Even tons that were initially cleared by customs officials for export are being held up, according to traders. This mirrors the situation facing phosphate exports in China, one trader noted.
Even with tight export restrictions in place, some providers are still allowed to talk with international traders about small lots of 5,000-8,000 mt to be shipped in containers to regional buyers, although the continued lack of new business leaves nothing available for price discovery. This situation is expected to continue through the first quarter, and possibly into May.
Brazil:
Imported urea prices in Brazil lifted to $325-$340/mt CFR from $320-$335/mt CFR in the prior week. Market sentiment turned optimistic on the results of the Indian tender and increased activity in Europe. There are reports that some sellers have withdrawn offers from the market.
Rondonópolis prices widened to $465-$485/mt FOB ex-warehouse from last week’s $475-$480/mt FOB as more players returned from the holiday season. The market’s high volatility is reportedly impacting negotiations for the second corn crop, which was delayed due to weather constraints.
Rains and improved weather forecasts are leading farmers in some parts of the north-central region of Mato Grosso state to consider an increase in corn acreage. For now, however, suppliers are facing delivery issues due to delays at the port of Santarém.
Urea buyers for Brazil were aggressive in 2023. Trade Data Monitor reported yearly imports at 7.3 million mt, up 3% from the 7.1 million mt purchased in 2022. The increased buying continued even as local vendors reported sufficient supplies.
Oman and Qatar combined for 40% of the year’s imports, with Oman sending 1.6 million mt and Qatar shipping 1.3 million mt. Nigeria remained a steady supplier as well, sending 1.2 million mt to Brazil, down slightly from 1.17 million mt in 2022.
December imports were pegged at 949,000 mt, the market’s largest monthly import total in the previous four years and a 37% increase from the 693,000 mt received in December 2022.