FERTILIZER PRICE COMMENTS FOR AUGUST 2021

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NITROGEN

Algeria
AOA had four 40-45,000t cargoes of granular urea available for export in September but was struggling to find a workable price due to high freight rates. Traders reported offers at $450-455/t fob Arzew but no sales were confirmed at that level. Formula-based cargoes have been offered at Brazil cfr minus $31-32/t freight, whereas rates up to $48/t were quoted in the freight market. AOA reported a sale of granular urea at $445-446/t fob for September loading.

Burkina Faso
Sofitex has issued its fertilizer purchase tender for the 2022-23 agricultural year, closing on 17 September. It was seeking 44,000t of urea plus NPKs and potash. The tender was divided into 20 lots of 1,000-4,000t of urea, for delivery to different regions across the country.

Egypt
Alexfert sold 4,000t of granular urea at $472/t fob for August loading to a European market. This was the highest price achieved by an Egyptian producer in more than eight weeks. Most markets, though, showed substantially lower netbacks. Argentinian prices were equivalent to $440-445/t fob, while Turkey and Black Sea markets were equivalent to $435/t fob Egypt. Producers were reluctant to countenance these levels, but pressure to sell urea mounted as August progressed. Some opted to wait for the next Indian tender before deciding their next move. Keytrade loaded 30,000t of granular urea in Damietta 15-20 August for Argentina. Producers continued their search to find an acceptable price for September cargoes. One lot traded on the paper market at $463/t fob for September, but traders were unwilling to pay anywhere close to $460/t fob for physical tonnage. Producers offered granular urea down to $455/t fob but bids were closer to $440/t fob. Argentina no longer represents an attractive outlet for Egyptian tonnage, rising freight and falling cfr prices mean that netbacks to Egypt were around $430/t fob. Mopco reported selling 2 times 20,000t of granular urea for September shipment at prices in the low/mid- $450s/t fob Damietta. Prices afterwards generally weakened slightly, with offers down to around $450/t fob on Thursday. Abu Qir reported sales of 30,000t of granular urea at $450/t fob and 5,000t of prilled urea at $440/t fob, both for first half September loading. These levels were $20-25/t above prices being paid for urea from competing origins in markets in the Black Sea/eastern Med.

Ethiopia
EABC received two offers in its late-July tender to buy 150,000t of granular urea, but no further developments were reported and it was unclear whether it will purchase urea at high price levels. One cargo booked under its 2020 annual tender was scheduled to load from Saudi Arabia for the past few months, but a vessel was yet to be nominated. Suppliers expected EABC to issue its annual tender during August to close in September. EABC sought around 150,000t of urea for prompt shipment after July’s inquiry failed amid minimal offers.

Mali
CMDT issued its annual tender to buy fertilizers for the 2022 crop, inviting offers on 27 September for 110,000t of urea plus NPKs. Offers should be valid for 90 days.

Morocco
An importer booked around 10,000t of Russian prilled urea close to $490/t cfr for September arrival.

Nigeria
Koch was in the market for a vessel to load 35-44,000t of granular urea in Onne 25 August-3 September for Porto Acu and Paranagua, Brazil. Indorama expected three 40,000t cargoes to load for export in September. Urea production rose as new plants proceeded through their start-up phase and increased exports were expected from September onwards, coinciding with the end of peak season demand in the country. The first urea plant at Dangote’s Lekki complex was reported to be operating at about 60pc of capacity and supplying urea to the domestic market. It has a capacity of 3,500t/day of granular urea. The second urea plant at Indorama’s Port Harcourt complex was also running well. It has a capacity of 4,000t/day of granular urea. Indorama was expected to have three 40,000t cargoes for export in September, most or all of which will move through its regular offtakers to Brazil.

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PHOSPHATE

East Africa
Importers, especially in Tanzania, were interested in purchasing DAP for the upcoming application season, but a delayed onset of rains on the one hand and high international prices on the other prevented concrete demand from manifesting. There was general interest for an October-loading shipment from Saudi Arabia, split between Dar es Salaam and Mombasa, but no prices on this have emerged yet. Local sources expect further developments in mid-September. In Kenya, market participants report reduced domestic demand because of current price levels.

Kenya
Domestic selling prices rose to 3,200 Kenyan Shillings (KShs) per 50kg bag ex-warehouse Mombasa ($584/t), compared with KShs2,650/bag ($484/t) in the beginning of the March planting season. Inland retail prices to farmers rose from KShs2,50/bag ($520/t) to KShs3,400/bag ($621/t) in the same period.

Morocco
LatAm takes two thirds of Moroccan July ferts exports
Brazilian and Argentinian fertilizer importers were the main receivers of Moroccan fertilizer loadings last month, Argus line-up data show. Morocco’s OCP loaded 517,000t out of a total 784,000t of DAP, MAP, NPK, NPS and TSP for Latin America from its Jorf Lasfar production hub on the Atlantic coast, accounting for two thirds of total shipments. OCP was looking to hold its offers flat. OCP targeted DAP levels at up to $715/t fob for European markets. The Stelios B sailed eastwards with 44,000t of DAP for Bangladesh under OCP’s government-to-government agreement. This marked the first Moroccan DAP vessel to Bangladesh since mid-January, Argus line-up data show. OCP was in discussion to sell DAP to India, but no sale was confirmed. DAP prices from Morocco softened by $10/t to $690-700/t fob, reflecting lower prices in Europe and Turkey. OCP has begun turning its focus east, with two DAP vessels underway to Bangladesh under government-to-government agreements. The producer also loaded a 50,000t NPK vessel for India, further highlighting the increasing seasonal importance of the Indian subcontinent. But MAP shipments to Brazil have continued, and line-up data showed over 220,000t of MAP that departed for Brazil.

Mozambique/South Africa
Ma’aden sold 25,000t of MAP 11-52, with 10,000t priced in the mid-$740s/t cfr. The remainder of the cargo is priced on formula. It will load in September

Tanzania
Tanzania has encouraged farmers to switch fertilizer use to NPS and NPS+Z as an alternative to costlier DAP. The country has also suspended its bulk procurement system, the government said, opening the market to imports without purchasing through fertilizer authority TFRA, although imports require a TFRA permit. In a bid to stimulate fertilizer buying, NPS and NPS+Z were available to farmers at 60,000-65,000 Tanzanian shillings/50kg bag ($517-560/t) in Dar es Salaam, the government said. Moroccan producer OCP will supply NPS at these prices, according to the government, although OCP has no shipments to Tanzania from Morocco planned. OCP has only previously exported trial lots of NPS to Tanzania. Most of its NPS exports are destined for Ethiopia under the Ethiopian Agricultural Business Corporation’s (EABC) annual purchase tender. OCP supplied 19-38-0+7S, 18-37-0+7S+2Zn, 19-38-0+7S+0.1B and 18-36-0+7S+0.1B+2Zn to EABC. The announcement comes after months of rising DAP prices eroded import demand in east Africa. DAP prices under a TFRA tender were above $600/t cfr equivalent last month, leading TFRA to cancel the enquiry and encourage importers to buy directly. The most recent DAP imports were at $490/t cfr in February. There was import demand following the government’s opening of the import market and abolishing of the bulk procurement system, but no new sales emerged. Market participants expected that domestic fertilizer demand will prioritise DAP over NPS in the upcoming September-October season. The government had encouraged farmers to purchase NPS instead\ of DAP amid high international DAP prices. But local sources expect that a shift in demand, if any, will take years. There was buying interest for DAP for October and December shipment, but no sales or offers have emerged.

Tunisia
DAP for southern Europe was indicated at $700-710/t fob.

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