US Gulf:
The NOLA urea barge market firmed to $305-$312/st FOB for July and $310-$315/st FOB for August trades, up from last week’s $300-$307/st FOB range for limited July business.
Eastern Cornbelt:
Urea was unchanged at $365-$375/st FOB in the Eastern Cornbelt, with the low confirmed at Cincinnati, Ohio, and the high out of inland warehouses.
Western Cornbelt:
Urea pricing remained at $345-$365/st FOB in the Western Cornbelt, with the low reported at St. Louis, Mo.
California:
Urea was steady at $490-$540/st FOB in California, with the low reported for granular bulk tons at Stockton and the high for prilled urea at San Diego. Bagged granular urea remained at $560/st FOB Stockton during the week. No current DEL prices were confirmed in late July.
Pacific Northwest:
The urea market was quoted at $415-$420/st FOB in the Pacific Northwest, with the low confirmed at Riverview, Ore. Delivered tons were reported at $400-$410/st in the region.
Western Canada:
Urea was quoted at C$615/mt FOB and C$640/mt DEL in Western Canada.
India:
India’s urea stockpile remains high at an estimated 10 million mt, sources said. Demand is expected to pick up in the third quarter, however, leading sources to speculate that another tender could be called as early as mid-August. Rashtriya Chemicals and Fertilizers Ltd. (RCF) could run the next tender, players said.
For now, traders are busy fulfilling the awards issued in the recent Indian Potash Ltd. (IPL) tender. Several vessels have reportedly been booked to pick up tonnage in the Arab Gulf ahead of the tender’s late-September shipping deadline
The Indian government announced its final FY2024-25 budget. The amount allotted for fertilizer subsidies was dramatically slashed from the previous year.
The subsidy allocation for the current fiscal year is Rs164,000 crore ($19.6 billion), down significantly from the Rs251,369 crore ($30 billion) that was ultimately approved for the 2023-24 fiscal year. The bulk of the subsidy payments will go toward maintaining a set price of about $64/mt for urea. Phosphates and potash subsidies fluctuate, as they are based on market prices and nutrient content.
Mediterranean:
Buyers in France and Italy are reportedly beginning to resist offers of $400/mt CFR, with last week’s short-lived outage in Egypt failing to stir interest for fresh tons in the Mediterranean. Demand in nearby Turkey and Romania is also reportedly muted. As a result, granular urea in the Mediterranean was stable at $385-$400/mt CFR.
Southeast Asia:
There were no reports of fresh spot granular urea business in Southeast Asia. Still, traders active in the region reported improved availability, despite producers indicating that they are well committed for August. Granular urea pricing was unchanged at $350-$366/mt FOB.
Indonesia:
Early-week rumors that Indonesia’s recent granular selling tender was being scrapped – even after an award was made at $366/mt FOB – were discounted by traders as the week wore on. By the end of the week, Pupuk confirmed the sale of 30,000 mt to Universal Harvester, of the Philippines, with the tons scheduled to ship in early August.
Pupuk had offered up to 45,000 mt in the tender and hoped it could sell even more following the award. Buyers were reluctant to step up to the $366/mt FOB level, however.
There were reports this week that Pupuk entered into talks that would move the deal from a flat fee to a formula basis. According to one trader, Pupuk offered tons at a rate to be determined by the published average of the export price, plus a premium. The premium would be used to cover transportation and other handling costs. So far, the trader noted, no one has taken Pupuk up on the offer.
Pupuk closed a prilled urea tender of just 5,000 mt this week at $378/mt FOB. Sources reported that Universal Harvester was also involved in the deal. This tender closed significantly higher than the last prilled sale of $323/mt, and places prills in the unusual position of being priced at a premium to granular. Sources said the absence of Chinese urea in the global market has made securing prilled urea more difficult.
Middle East:
Producers are spending time covering IPL/Indian tender awards and long-term contract sales in lieu of chasing spot deals. At least three ships are slated for imminent arrival to the Arab Gulf to begin loading tons for India. In the end, IPL only took about 433,000 mt in its tender, with most of the product expected to come from the Arab Gulf.
Regional shortages of natural gas in Egypt forced some facilities to close last week, and sources said these plants are still down. Plants located in areas where gas is still available are continuing to run, however. Egyptian producers with plants that remain in operation reported production at approximately 80% of rated capacity, with some indicating slightly higher output.
Prices moved up on a sale of two 5,000 mt lots by NCIC late last week at $362-$367/mt FOB, in line with expectations. Before the deal was closed, producers had been pushing for deals in the low-$370/mt FOB for August and September loading. Producer price ideas have now moved into the mid- to upper-$370s/mt FOB, with some even calling for $380/mt FOB.
China:
Restrictions on urea exports remain in effect. An increasing number of traders are beginning to fear that rumors indicating the restrictions could be kept in place for the rest of the year may be true.
Prices ex-factory dropped significantly this week. The price dipped to RMB2,050/mt ex-plant early in the week, sources said, before bouncing to RMB2,070/mt by July 25, translating to an estimated export price in the $307-$310/mt FOB range. The lack of spot business from China has left domestic prices as the only way to indicate where export prices might stand at any given time.
While the lower price should make export inspectors happy, the country’s urea reserves seem insufficient to placate the inspectors, sources said. There are reports that more plants are stepping up production. Until prices move even lower than current levels and reserves grow much larger, sources said there is little hope for any urea exports.
January-June urea exports totaled 140,000 mt, according to Trade Data Monitor, down86% from the year-ago 1 million mt, when exports were partially restricted.
The tonnage reflected small-quantity sales, mostly shipped to buyers in the Southeast Asian market in containers. South Korea topped the buyer list with 53,000 mt. Sources said shipments were permitted to that country due to the need for urea as part of its anti-pollution program. Japan accounted for 12% of exports with 17,000 mt, while 15 countries bought a total of 51,000 mt in 1,000-9,000 mt lots. Another 33 countries received material in 1 mt-900 mt lots.
June exports were reported at 74,000 mt, down 67% from the 224,000 mt shipped in June 2023. Second-quarter sales to six countries totaled 114,000 mt, compared to the 483,000 mt spread between 50 countries in April-June 2023.
Brazil:
The urea market remained firm in Brazil, supported by the uptrend kicked off by India’s latest tender. Granular urea imports were steady at $360-$370/mt CFR, with bidding reported at $350-$358/mt CFR failing to attract a seller.
Rondonópolis prices were stable in the $480-$500/mt FOB range. Many growers have been cautious about taking positions due to the tight planting window, similar to what occurred in 2023.
While farmers have continued to request prices in an effort to keep tabs on the barter ratio for nitrogens, actual sales have slowed with growers focused on the corn harvest. As summer planting approaches, however, the nitrogen market is expected to heat up.
Argentina:
January-June urea imports in Argentina totaled 411,000 mt, Trade Data Monitor reported, a 138% increase from the year-ago 172,000 mt. Algeria sent 136,000 mt, Nigeria shipped 110,000 mt, and Egypt added 67,000 mt. Bolivia and Turkmenistan accounted for another 50,000 mt each.
June imports were noted at 131,000 mt, up 70% from the 77,000 mt received one year earlier. Second-quarter imports were 210,000 mt, rising from the 144,000 mt purchased in April-June 2023.