U.S. Gulf: Some observers last week continued to shake their heads over the volatile NOLA granular market, with prices stable one day and $40/st higher the next.
And that is exactly what happened last week. On Thursday morning, most were calling the NOLA granular prompt market at $500-$515/st FOB. However, by late in the day, new trades were reported within the $530-$540/st FOB range.
Why such an increase, so fast? Sources attributed it to a few things, with one being spot outages. Sources argued over the availability of tons, with some saying there simply is not that much product available, and when demand hits, prices go up.
Sources also argued over the availability of imports. Some said imports will be plentiful in the months to come, but others are saying the quantity is nothing special and that the U.S. may very well run short of urea in a year when the USDA is projecting 94 million acres of corn.
Sources also debated the degree of the volatility itself, with some saying it had been abnormal since September 2011, and others saying NOLA granular has always been a volatile product.
Until this week, players had been significantly discounting April product, putting a much higher premium on prompt or March product. Now, sources say there is not that much left for March and that April is getting much more attention, with those prices starting to shoot up as well. One player said quotes of $470/st for April had now moved to $490/st.
Eastern Cornbelt: Granular urea prices were pegged in the $540-$560/st FOB range in the Eastern Cornbelt region last week. Ohio sources quoted the market at $545/st FOB Cincinnati, while dealer reference levels were pegged as high at $580/st FOB northern Ohio terminals.
Western Cornbelt: Granular urea pricing in the Western Cornbelt covered a broad range as the week progressed. The low end of the range was reported early in the week at $535-$540/st FOB terminals in southern Missouri, but another run-up in NOLA barge prices fueled some strengthening terminal prices later in the week. In Iowa, the urea market was quoted in the $560-$585/st FOB range as the week advanced, with the upper end quoted in the western part of the state on March 8.
Retail urea pricing also covered a broad range due to the rapid increase in replacement costs. Iowa dealers said retail pricing varied from $520-$600/st FOB last week, “depending if you have inventory.”
Effective March 6, Koch’s urea postings in Oklahoma firmed to $560/st FOB Enid and Inola/Catoosa, up $10/st from the Feb. 28 list price. On March 7, however, Koch announced another increase, to $575/st FOB Enid and Inola/Catoosa.
Northern Plains: Granular urea was pegged at $550-$560/st FOB, with the low at the Twin Cities and the upper end FOB Sioux City, Iowa. In the North Dakota market, urea pricing had firmed to $570-$588/st FOB or DEL.
Sources reported lots of inquiries coming from growers and dealers as the urea price ratchets up, but actual movement remained on the backburner in the region. One South Dakota source said his area received some rains early in the week, but remained behind on moisture overall.
Northeast: Granular urea pricing in the Northeast had firmed to $535-$550/st FOB, with the low reported out of Pennsylvania shipping points on a spot basis. The dealer market FOB E. Liverpool, Ohio, was pegged in the $540-$550/st FOB range last week.
Eastern Canada: Granular urea pricing in Eastern Canada had firmed to $630-$645/mt FOB by early March, up some $55-$80/mt from last report, depending on location.
Ontario sources reported some fertilizer movement to the field in early March, with most activities limited to topdress applications of nitrogen on wint