U.S. Gulf: Pent-up demand surfaced last week, according to most sources, who said they were busy handling orders – or at least inquiries. As a result, granular urea barge prices ran up.
While some argued old prices from the previous week held over, others said they were gone by Monday. Still others said early week trades began at $408/st FOB and worked their way up to $420-$425/st FOB, and then on to $430/st FOB. At that point, offers of $435/st FOB met resistance and the market sank back to $425/st FOB.
July-December imports were off 5 percent, to 3 million st from the year-ago 3.15 million st. December imports were off 51 percent, to 452,564 st from the year-ago 921,192 st.
Eastern Cornbelt: The granular urea market was quoted at $440-$455/st FOB in the Eastern Cornbelt, with the low reported in Illinois and the upper end in the Ohio market. The Cincinnati urea market was tagged at the $450/st FOB level at midweek.
Western Cornbelt: The granular urea market in the Western Cornbelt had reportedly inched up to $440-$460/st FOB, with the upper end quoted in the Missouri market as the week advanced. Effective Feb. 15, Koch’s urea posting FOB Enid firmed to $465/st FOB, up $25/st from the Jan. 18 reference level.
Northern Plains: Granular urea pricing had firmed to $450/st FOB the Twin Cities, while delivered urea in North Dakota was pegged in the $502-$518/st range last week.
Great Lakes: Wisconsin sources pegged the low end of the granular urea market at the $440/st FOB mark last week. Michigan sources quoted the dealer market in the $450-$470/st FOB range, with the low out of terminals in northern Ohio and the upper end out of inland Michigan shipping points.
Northeast: Granular urea pricing continued to firm in the region. Sources said pricing levels at the $440/st FOB level in January had moved up to $450-$455/st FOB by last week, with the low in Philadelphia and the upper end quoted out of E. Liverpool, Ohio. There were rumors of rail-delivered tons pegged as high as $486/st into the region at mid-month, but sales at those levels were not confirmed.
India: Sources report that the current state of urea reserves is sufficient to allow Indian buyers to wait before jumping into the market.
The strength of the Indian reserves is disappointing to those in the market looking for a strong buyer to step in and set a bullish tone in the marketplace.
Usually about this time Indian buyers are beginning to kick a few tires to see how the urea market would react to a tender issued in early-to-mid-March. Unfortunately for people looking for a market trend or something to get the market moving, the Indian buyers are staying home.
One trader noted that last year the Indians wanted to secure large orders quickly and early. That action led to a jump in the price, something the Indian government wanted to avoid.
Sources point out that nothing can seriously begin to happen until mid-March. By then, the subsidy and import rules for the next fiscal year will be known. At that time, Indian buyers can begin to look for material to be delivered in April.
Part of the delay in moving on urea inquiries could also be related to the ongoing discussions about the urea subsidies and possible deregulation of the product. A committee representing various government ministries has been working to hammer out a deal that would ease the subsidy burden on the treasury, while at the same time protect the farmers from wild price swings.
In January it looked as if a deal was ready to be sent to the full cabinet. However, in the past week or so the Finance Ministry objected to any plan that included the freeing of urea prices. According to press reports, the ministry w