U.S. Gulf: Granular barges remained strong last week, reported between $347-$360/st FOB for prompt material. Prices appeared to start off strong and ended weaker. Freight rates continued to be major factor in price discussions. All of September was called $343-$353/st FOB, though most were nodding toward the lower end of that range at the end of the week.
Recent prill trades continued to be called $345-$348/st FOB.
Eastern Cornbelt: The urea market in the Eastern Cornbelt was pegged at $420-$440/st FOB regional terminals for limited tons.
Western Cornbelt: Many regional terminals were reportedly out of urea in late August. For any tons that were available, the dealer market was reported in a broad range at $390-$430/st FOB, down from last report, with the low reported out of spot river locations in Iowa.
Iowa sources also quoted rail-DEL urea tons at the $415/st level last week, while the market FOB St. Louis, Mo., was reported firmly at the $420/st FOB mark for new sales.
Northern Plains: The granular urea market was pegged in a broad range at $380-$400/st FOB the Twin Cities last week. The Midwest urea market was described by one source as “situational,” depending on supply and demand, with spot pricing much higher in areas of tight supply.
In St. Louis, for example, the urea market last week was quoted at a firm $420/st FOB, even though pricing there would typically be lower than the Twin Cities due to less freight. North Dakota sources reported rail-DEL urea tons at the $420/st level as well, with that same number also quoted on an FOB basis out of Carrington, N.D.
Northeast: The granular urea market remained at $410-$420/st FOB for limited tons in the Northeast.
Eastern Canada: The granular urea market was quoted at $570-$575/mt FOB regional terminals in Eastern Canada, up $45-$50/mt from last report.
China: Prilled prices keep moving up, while granular now seems to be slowing down and even retreating.
Sources report the latest offers from Chinese prilled urea producers at $310/mt FOB. Traders are quick to point out that nothing at that level has yet been done, but it indicates where the producers are heading.
Last week saw a batch of traders stepping up and buying material to cover their IPL/India tender awards, knowing they will take a financial hit.
The surest sign that the traders are grudgingly accepting the Chinese prices is the increase in vessel nominations for India-bound material.
Sources say the vessel lineup was pegged at 650,000-800,000 mt last week. More ships are expected to be named in the next week. Winners of the IPL tender have until the end of September to load their material.
Reportedly, some traders are buying small quantities – 10,000-15,000 mt – to test prices and to hedge against running up the price with large orders. Sources report that many of the deals concluded last week were centered on $295/mt FOB.
Buyers for the Indian market are beginning to face more competition. Sources say some Southeast Asian buyers are now showing interest in Chinese product, with some claiming they secured tons in the low-$290s/mt FOB.
Domestic demand for prilled urea is picking up in spite of existing Indian demand, the expectation of another Indian tender in the first half of September, and the Southeast Asia market heating up. Sources say domestic buyers are looking for tons to get into the domestic pipeline as soon as possible.
Granular urea, however, appears to have stalled. Sources say offers are now at $350-$355/mt FOB, with bids coming in lower than that.
Producers are reportedly working out what kind of demand their product will