U.S. Gulf: Bearish numbers continued to be reported last week, with sources reporting that new physical prompt trades for granular were done as low as $350/st FOB. However, some argued that these were not necessarily available to everyone and were one-time deals.
Conceivably, the low-priced barges could be for product still to come in and be loaded. Sources argued that barges that were ready to move up the river began the week at a premium, as high as $380/st FOB. After the drop to $350/st FOB, sources said price ideas were moving their way back up toward the higher number.
Persistent wet weather was keeping inland warehouses full and barges stationary at NOLA. While lots of urea should conceivably be needed for 97.3 million acres of corn, sources said continued wet weather is having its impact. Sunny skies are needed right away to turn the market around, said sources, assuming it is not already too late.
Eastern Cornbelt: Granular urea was quoted in the $435-$445/st FOB range in the Eastern Cornbelt region.
Western Cornbelt: Granular urea was quoted at $435-$445/st FOB in the Western Cornbelt region. Sources quoted the Tulsa, Okla., market in the $420-$425/st FOB range last week, and urea pricing as low as $425/st FOB was also reported in the Twin Cities market in Minnesota.
California: The granular urea market was unchanged at $485-$500/st FOB for truck tons in California, depending on location, with reports of brisk “hand-to-mouth” movement in the state.
Rail-delivered urea was down from last report, however. “Few people want to commit to large rail volumes for future arrival since prices seem to be falling,” said one source. The rail-delivered urea market was quoted at the $500/st level at the upper end, but sources also talked of railed tons that were “definitely cheaper.”
Pacific Northwest: Sources reported softer urea prices in the Pacific Northwest last week. The FOB market was pegged in the $500-$520/st range, depending on location, down $20/st from last report on the low end of the range. Rail-delivered urea was quoted in a broad range at $495-$530/st in the Pacific Northwest, also down significantly from last report.
Western Canada: Sources quoted the granular urea market at $565/mt FOB and $585-$600/mt DEL in Western Canada, while dealer postings remained in the $610-$635/mt DEL range, depending on location.
India: The IPL urea tender that closed April 12 showed softer netbacks to Yuzhnyy and the Arab Gulf than earlier predicted.
At first IPL awarded 500,000 mt, with Iranian sources supplying about 300,000 mt of the take. By the end of the week, however, it looked as if more Iranian tons will be sent to IPL.
Sources report that Oman is in for 100,000 mt, Eurochem through Dreymoor is in for 50,000 mt, 60,000 mt will come from Indonesia, and 50,000 mt from China. The rest of the awards will be coming from Iran.
Unfortunately for the producers from China to the Arab Gulf to Yuzhnyy – and fortunately for India – not enough tons are being taken to stem the slide in pricing.
Working off the lowest offer from Quantum at $379.70/mt CFR, the Yuzhnyy netback comes to about $350/mt FOB, and the Arab Gulf – mostly Iran – netback is $365/mt FOB.
The average price of all the firm offers came to $390.73/mt CFR. This is a substantial savings when compared to the last tender of 2012, when the average in the IPL tender was $414/mt CFR. The low price in December was $404.45/mt CFR.
All told, companies presented 1.49 million mt as firm offers. Another 860,000 mt were offered as optional tons.
Normally, Indian buyers will counter with specific prices for select p