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Argus Events










10 years – 3 fertilizers urea/DAP/MOP

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Argus Media Ltd is the source of the data, on which IFDC bases the above calculations



International Monthly Average Prices for selected Fertilizers



Argus Media Ltd is the source of the data, on which IFDC bases the above calculations




Market higlights

NITROGEN

Suppliers achieved small increases in prices for urea in some markets at the end of January, but the overall market appeared to have reached a plateau. Barring a sudden upsurge in US demand, there appeared to be limited upside to prices from current levels for February shipment. Sales took place in the range $275-280/t fob Arabian Gulf and in the high-$280s/t cfr Brazil, both slightly higher than previous business. The buyer was reported to be the same in both instances – Yara. In most other markets, prices have stagnated. Two or three lots of Egyptian granular urea were sold at $285-286/t fob, but a tender for 25,000t on 26 January failed to find a buyer. The main exception was for Baltic prills, where active demand in Latin America saw prices move up from $250/t fob in the third week of January to $256-261/t fob at the end of the month. Chinese granular urea was sold in the mid-$260s/t fob from northern ports. One Iranian cargo was sold in Italy in the fourth week of January for about $15/t below comparable prices for Egyptian urea. French prices also eased as vessels arrived in Atlantic ports with some unsold product. Traders were liquidating long positions taken on January cargoes at below replacement cost for February tonnage. Nola prices remained below $260/st fob, equivalent to $281/t cfr at best and was not encouraging anyone to buy. Opinion was divided on whether US prices would rise enough to show a premium to world markets in time to suck in more imports. February and March arrivals in the US Gulf are forecast to be high. CF’s Port Neal plant is producing urea, although by no means at full capacity, and distributors are content to wait. A new, temporary, competitor emerged for prilled urea suppliers with the approval for export of 300,000t of Pakistani urea. Producers in the country have over 1mn tonnes of inventory and have been pressing to export some of the surplus for several months. The government finally acquiesced and Fauji, Engro and Fatima each had about 100,000t of urea to sell. It was available for shipment up to 28 April and traders were checking possible destinations such as Turkey, East and West Africa and southeast Asia.

EGYPT

Availability of granular urea for export in February was estimated at 210,000t, based on production of 450,000t and domestic market requirements of about 240,000t. Sales to date for February amounted to about 60,000t. Mopco held a sales tender on 26 January for 25,000t of granular urea for February shipment but failed to find a buyer at satisfactory price. Abu Qir held a sales tender on 24 January for 20,000t of prilled urea for February shipment. It sold the cargo at $262/t fob, $13/t up on its previous sale. The buyer was reported to be Global. Helwan Fertilizer sold 10,000t of granular urea to a trader at $286/t fob under a tender that closed on 20 January. The cargo was to be shipped to Romania. OCI sold 5,000t of granular urea on 23 January for February shipment to France at a price netting to $285/t fob.

ALGERIA

AOA reported a sale of granular urea for February shipment at $282/t fob. Sorfert was to load 35,550t of urea in January. It was to negotiate prices for February shipments in the first week of that month.

NIGERIA

Ameropa was reported to have fixed a vessel at $15.50/t to load 30,000t of granular urea in Onne 23-28 January for the Mississippi River. Indorama’s plant was closed for maintenance and will remain down until second half of February. Helm is scheduled to load a cargo when the factory restarts.

PHOSPHATE

The phosphate market strengthened in January. Prices globally continued to firm basis some decent demand in Europe and east Africa plus the continued near-total absence of Chinese DAP from the market (notional offers were reported at $350-360/t fob with some business done higher still, basis interest in Vietnam for small lots above $380/t cfr reflecting the $360s/t to $370/t fob). The firming remained primarily supply-side driven in the east, but it was clear that Indian DAP demand was stirring. Two tenders were announced in the fourth week of January for a total of 200,000t DAP while there was also an invitation to supply a further 200,000t DAP under long-term MoU. Much of this was undoubtedly price checking but Indian importers would be concerned at the rapid and inexorable rise in Chinese DAP prices and the paucity of supply from other sources. This may indeed be behind news that the inter-ministerial group recommended to the Indian cabinet that the subsidy for DAP be raised almost Rs 800/t although currency depreciation would have also played a part. The lack of Chinese supply once again saw Saudi asking prices move up into the higher-$340s/t fob on business in east Africa. There was little action east of Suez. In Indonesia there was a succession of tenders, the latest concluded in the lower-$360s/t cfr while Pusri issued an inquiry for another 15,000t. There was also interest in Vietnam although availability was tight. Pakistan meanwhile put a stop to all further imports of DAP pending resolution of the $45m still owed to importers from September under the subsidy scheme. Residual DAP import demand was limited in any case. But any thought of imports for the sugar cane crop have been banished. West of Suez, Tampa DAP levels rose $5-7/t to $335/t fob on a sale to Latin America whilst the domestic DAP barge price in the US also firmed again. Meanwhile in Europe, north African producers managed to achieve prices in excess of $350/t fob on latest sales. Asking prices in northern Europe rose to $380-385/t fca. Latin America was quiet but Brazilian prices were largely stable. Mosaic's sales were to central America reflecting $350-360/t cfr. OCP notably said it was unlikely to offer in Brazil before March and would target $360/t cfr minimum.
The consistency of Chinese DAP fob offers, the tight supply due to production curtailments and pull from the domestic sector remained fundamental factors behind the price hike. But the effect is being felt globally. This will continue throughout the first quarter. The real test of Chinese resolve will be seen once the domestic sector is completed. This will coincide with the downturn in demand in Europe and the US.

MOROCCO

OCP sold around 35,000t DAP for February shipment to European markets in a $350-356/t fob range. Its remaining sales were NPKs which had again limited supply. The January export line up from Jorf Lasfar currently included the following (there were reports that US vessels have been delayed due to heavy rains):
  • Sabahat Sonay 12,000t DAP/MAP/NPKs Helm/Romania
  • Desert Calin 46,000t DAP Nigeria
  • Karg Shun 50,000t DAP/MAP CHS/US
  • Norma 7,000t DAP/NPKs Indagro/Greece
  • Adalady 7,000t DAP Ameropa/Romania
  • Gulf 4,000t DAP Unifert/France
  • Anzoras 5,000t DAP Koch/France
  • Nord Manzanilo 28,000t MAP Heringer/Brazil
  • Susanne 3,000t Goulding/Ireland
  • Silver Lady 50,000t DAP/MAP Koch/US
  • Karla C 6,000t DAP Koch/France
  • Lady Nurgul 4,000t DAP Koch/France
TOTAL: 222,000t approx (does not include exclusively NPK/NPS shipments)

OCP Morocco January commitments            '000t
US                                          180 DAP/MAP
Ethiopia                                    150 NPS
Nigeria                                     40 DAP/75 NPK
Europe                                      110 DAP
Brazil                                      35 MAP/45 NPS
Domestic                                    60 DAP
TOTAL                                       695
PRODUCTION                                  520-550

TUNISIA

GCT reported a sale of 15,000t DAP to various buyers in Italy in the $350s/t fob for late January/early February shipment. 40,000t DAP have been sold to buyers in France, Spain and UK/Ireland for late January/early February at a minimum $350/t fob. Domestic commitments will be around 7,000t for February with operating rates between 50-60pc.
GCT Tunisia January commitments             '000t
Domestic                                    10-15
Romania                                     10
Italy                                       15-20
Spain, France, UK&Ireland                   30-35
TOTAL                                       65-80
PRODUCTION                                  50-60
BALANCE + CARRYOVER (~20)                   -10-15

KENYA

Awarding of the Kenyan DAP tender remained opaque with some suppliers reportedly receiving notification of orders for NP/NPK and DAP for the tender but not the final contracts. No volume had been specified. It was unclear whether other potential suppliers also received these notifications.

POTASH

MOP prices were steady in Brazil, Europe and southeast Asia again in the fourth week of January, as China prepared for new year celebrations, which started on 27 January and lasted for around two weeks. Much of Asia was expected to be quiet in the meantime and, with northwest Europe still slow to pick up its demand levels in some countries and Brazil in low season for buying, there was little activity across the globe. PotashCorp forecast that global potash shipments will be 61mn-64mn t this year, well up on its forecast of 59mn- 62mn t for 2016. It also crucially said that it anticipates consistent customer engagement "throughout the year", a welcome relief to all suppliers that battled with slow firsthalf demand last year, and a tight end to the year in supply terms as a result of the late signing of the China consortium contracts. PotashCorp identified its expected key growth markets in 2017 as China, India, Latin America, and "other" Asian markets, most likely southeast Asia. It sees flat demand in North America. PotashCorp sold 8.6mn t of potash in 2016, well within the range that it forecast in its fourth-quarter 2015 results, but down from 8.8mn that year. It predicts sales this year of 8.7mn-9.4mn t, potentially an 800,000t increase on the year. And chief executive and President Jochen Tilk said he expects potash price increases to continue in 2017.

AFRICA

BPC sold a vessel of granular MOP to Nitron at around $250/t cfr, according to the supplier, while Nitron reported the deal in the mid-$250s. The 27,827t vessel Ismini loaded at Klaipeda on 2-5 January, destined for Dakar. Nitron sold the quantities to three buyers in Mali and Senegal.

Source: Argus FMB


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