CBC: Fertilizer Prices Report

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Fertilizer Prices Report (weekly)

7. Mar. 2010

PRILLED UREA
Again as expected, prices have rallied from last week's lows, bolstered by resugent Latin American demand. FSU prills have sold at $282-285pt fob Ukraine while Baltic prices have also gained to $275-277pt fob from the icefree ports. The outllok for balance March is firm.

Buyers in Mexico and, to a lesser extent, Brazil have stepped into the market to book over 200,000t of urea over the past few days, mostly from the FSU. This demand has mopped up unsold tonnage in the Baltic and Black Sea and, as expected, prices have begun to recover. At presstime Mexican buyers were bidding in the low-$280s pt fob Yuzhnyy equivalent for new cargoes – one sale already nets $283-284pt fob Yuzhnyy. Initially the run of buying did not encourage traders to book new tonnage at $285pt fob Yuzhnyy, but this price has now been achieved in the expectation that further gains will be seen in the weeks ahead. Indeed, it is possible that prices will test the highs witnessed in late January/early February.

GRANULAR UREA
As expected Egyptian granular urea prices have dropped sharply towards $315pt fob. Interest is evident close to this level for Canada and Europe. Thus, Egyptian prices are probably close to the floor. Venezuelan product has been sold to Mexico at $313pt fob, in line with returns possible in the US Gulf.

Egyptian prices have tumbled with the latest sales tender bringing a highest bid $15pt below last done. However, this may be close to the floor as European demand should begin to build as weather improves. Further, US prices for April reflect above $320pt fob and, finally, Egyptian producers have been requested to supply 400,000t to the local market April-July.

In Asia, Chinese export prices remain high at $325pt fob for prills, $10pt extra for granular. Middle East suppliers are comfortable for the month and have rejected approaches for granular sub $315pt fob.

While the urea market has not changed from cool to super-hot, a floor level has now been found for FSU product and perhaps also in Egypt and the US Gulf. However, for the market to really take off beyond Q1, major demand will be needed from the Indian subcontinent to fill in the gaps as Western offtake slows.

UAN
The general outllook for UAN is good in N America and France as this nitrogen source is cheap. However, with tanks full in France traders are competing to secure small business at lower prices. This will continue until spring movement begins later in March.

Source: Argaam, Profercy report, Fertilizeer-Index.

Fertilizer Prices Report (weekly)

28. Feb. 2010

PRILLED UREA

FSU prices have remained under pressure this week but there are now clear signs the fall is almost over. Turkish buyers have entered the market to book product at $275pt fob after battling to obtain lower levels. A price recovery is expected in March.

Despite the recent negativity, at presstime there were clear signs that the prilled market had bottomed out. a sale to Mexico was finally agreed at around $320pt cfr. Further, Ukrainian producers have rejected bids at $275pt fob for March while at least two Russian producers have indicated that they will hold material in March rather than sell at low prices forced by the ice conditions in the Baltic.

The above factors, and particularly the acceptance of prices over $270pt fob in Turkey are expected to result in further firm inquiries emerging for March tonnage over the next few days. Prices could/should recover as buyers recognize no further price downside is possible.

GRANULAR UREA

Middle East granular urea producers have achieved high returns for product for second half March/April shipment over the past week. Around 60,000t have been sold at $330-345pt fob bulk, $30pt above returns in the USA. Indonesian product for April also achieved a stunning price,, selling at $331pt fob. The lack of additional product from this source over the next 3-4 months coupled with the high price of Chinese urea, $320-325pt fob bulk for prills and $335- 340pt fob bulk for granular, prompted traders to book the Pusri product.

In contrast, Western markets were slow again early this week and prices came under pressure.

UAN

The French market is full with movement from tanks blocked by cold weather. Thus, attention is more concentrated on the US. A sale into the east coast at $245pt cfr has been reported, reflecting $210pt fob Baltic. Suppliers are now attempting to move prices on to $250pt cfr.

Source: Argaam, Profercy repott & Fertilizer - index.

Fertilizer Prices Report

22. Feb. 2010

PRILLED UREA

FSU prices have eased to $280-285pt fob Black Sea this week with only Turkey active. The $50pt gap with granular implies that the fall is almost over and there have been efforts to book March tonnage long at sub $280pt. Producers have rejected these approaches.

Prilled urea has been the bad apple in the nitrogen barrel again over the past week. Price weakness has been evident in the FSU as traders have looked to liquidate February positions. Ukrainian producers are offering at $285pt fob while in Central America a major buyer is being offered a prompt cargo at $270pt fob Baltic equivalent and bidding lower.

Returning to the West, the drop in FSU prices does not appear to be anything more than a correction. Lower prices should generate prilled demand in Turkey, Europe and Latin America in late February/March. Indeed, it does appear that some February demand has been pushed back into March as prices were too steamy in late January/early February. If, as expected, this demand solidifies, a new price rebound could occur. Further supporting this view, if urea were to keep falling, parity with AN might be evident. This would be exceptional.

GRANULAR

Egyptian granular prices have eased, but only by $2pt & have held over $330pt fob this week, but only small volumes have sold. With European demand stalled traders are putting high-priced Egyptian granular into store, hoping for a price boost when cold weather eases. Middle East prices are stable with producers heavily committed for March with contract business.

In the US barge prices are put at $315-320ps ton with one or two sellers losing their nerve and opting to discount prompt material.

In the Middle East, spot granular prices have also adjusted slightly. However, a sale at $315pt fob to Thailand compares favourably with other recent deals as those were to nearby destinations. Further, the price obtained for Thailand provides evidence that the Middle East suppliers are comfortable through March at least and that there is no pressure to cut prices to chase spot business.

As regards granular, bad weather has delayed activity in the US and Europe. However, this does not mean spring has been cancelled and, in both cases, major demand is anticipated in March/April. European nitrate prices are high and availability likely to be insufficient to cover nitrogen demand. Healthy buying of granular urea is expected in which could/should underpin Egyptian granular prices at higher levels than those currently reflected by the US Gulf.

UAN

Egypt achieved $222pt fob this week for a relatively prompt cargo. This could head to the US. Baltic tonnage has also been committed to the US east coast, landing around $245-250pt cfr. US prices have yet to reach these heights but are moving up.

Source: Argaam, Profercy report, Fertilizer-Index.

Fertilizer Prices Report

16. February. 2010

PRILLED UREA:

A correction in FSU prices has occurred as traders with limited February positions to sell have been forced to liquidate in Turkey and Brazil. A short sale in Brazil reflects sub $285pt fob Yuzhnyy. The downturn in prices is expected to be short lived.

Urea has taken a knock this week with the US market slow and the lack of positive tender news from India unsettling traders and the short-term price outlook. With liquidity squeezed, Turkish buyers have been able to secure prompt urea ex- Yuzhnyy at $292pt fob equivalent. Those with tonnage still to buy claim offers at $285pt fob. In Brazil meanwhile, a cargo has been sold at $280-285pt fob Yuzhnyy equivalent, sub-$280pt fob Baltic.

The reduction in prices is very much a trader-driven phenomenon. Producers, and particularly those in Ukraine, are sold out into early March and are still maintaining price ideas above $295pt fob for March. However, there is no appetite among traders to consider going long at this stage and at such a price.

GRANULAR UREA:

The market internationally is stable. Cold weather in Europe is making it difficult for traders to turn an immediate profit on Egyptian positions and product will likely move into store. Middle East prices are steady due to contract commitments while a spot cargo has been placed in Thailand around $315pt fob.

Granular prices are also stalled. As yet traders who have booked tonnage at $335pt fob Egypt cannot make these prices work in Europe. Cold weather is delaying activity and buyers feel in no rush while uncertainty over application timing and the Euro/Dollar rate prevails. The USA is also dogged by cold weather and while all agree that the market is not long, there is no rush evident from dealers/farmers to secure product for spring application. Thus, barge prices in Nola are flat with sellers seeking over $320ps ton fob prompt and buyers $3-5ps ton lower. Asia is also slow with the Chinese New Year bringing business to a halt.

Despite the current nervousness pervading the market, it does not appear that a period of continuous decline is about to ensue. Substantial demand has still to be covered in Europe, Turkey and the Americas for March while in Asia there is still the chance of an Indian tender being announced. Thus, while some FSU producers may need to accept lower prices in the short term, the current bout of price weakness may be just a correction from the relative overheating in late January/early February.

UAN:

US prices are picking up but have yet to reach levels that would support Russian and Ukrainian netbacks over $205pt fob. The French market is stable at Euros 165pt FCA Rouen with business slow in part due to the extremely cold weather across northern Europe.

Fertilizer Prices Report

7. February. 2010

Prilled Urea; FSU prices have consolidated in the 290-300$ pt fob range. Good demand is expected over the next 30 days in Latin America, Turkey and Europe (if granular prices appreciate further). There is also the chance of an Indian tender which would be an added bonus for suppliers.

Chinese prilled urea is being offered from bonded store at 315-320$ pt fob, too high to meet buyers’ price ideas in nearby markets.

Granular Urea; Another 50-60,000t of Egyptian granular has sold this week at 335$ pt fob, mostly for shipment to Europe. High nitrate prices in the EU, up Euros 10pt this week, are supportive of this price but the weakening Euro is a concern. In the Middle East granular prices have moved on to 320-325$ pt fob for limited spot availability for February lifting.

The main price advance witnessed in the urea market over the past week has been in the Middle East with granular urea sold for February shipment at 321- 324$ pt fob. In addition a cargo of prills has been sold at 330$ pt fob, albeit to a nearby market. FSU and Egyptian prices have consolidated:

 In Yuzhnyy product has been sold in the high-$290s pt fob for February and again at 300$ pt fob for first half March.
 Egypt has placed a further 55,000t of granular urea for February shipment at 335$ pt fob and one small cargo at 340$ pt fob.

On the demand side in Asia, India has yet to announce any new tender. The usual uncertainty over India’s intentions is limiting the propensity for risk taking by most traders.

In the West, cfr prices are moving up with Brazil having paid 330$ pt cfr for FSU prills en route and 365$ pt cfr equivalent for granular.

Higher nitrate prices have added to the attraction of urea even though the weakening dollar has offset some of the gain.

UAN; French prices have moved on to Euros 165pt FCA for 30%N but are still Euros 10-15pt below replacement cost. Romanian product has sold at 220- 225$ pt fob this week while a Bulgarian cargo has been booked at 220$ pt fob, possibly for the US/Canada.

Source: Argaam, Profercy report, Fertilizer-Index.

Fertilizer Prices Report

31. January. 2010

Prilled urea prices have surged to 290-300$ per tonne fob in the Black Sea, the high end for March tonnage. Traders have thrown caution to the wind viewing good sales prospects in Europe/Turkey, Africa and Latin America. There is also the firm chance of an Indian tender which would be the icing on the cake.

The run up in prilled prices has been caused by a number of factors:
 Prills were cheap at 270$ per tonne compared with granular (the position has now been reversed).
 Production has been lost due to gas. shortages, cold weather and technical problems in Romania and the FSU.
 Latin American demand has gathered momentum.
 AN is unavailable which is pushing more buyers to prilled urea.

On the supply side in Asia, Chinese prilled urea is being offered for February at315$ per tonne fob ex-bonded store.

In the Middle East producers are generally free from selling spot tonnage due to heavy, continuous contract shipments to the US, Thailand, South Africa and the improving Australasian markets.

Granular urea; further major sales of Egyptian product have taken place this week at 335$per tonne fob, a 7$ per tonne increase on last week. The product is bought for Europe where current returns are 10$ per tonne lower due to the weaker Euro.
However, granular is now cheap versus prills which should result in a new price run up soon for the premium grade.

UAN prices are edging up in France but are still some Euros 10-15pt below replacement cost. The US is also gaining but again does not reflect current exporters' asking prices. With other N prices firm, it is expected that some swicthing to UAN will be evident in the US and France.

-Sources: Argaam, Profercy Report, Fertilizer-index.

Fertilizer Prices Report

24. January. 2010

Prilled urea prices are stable for this week with rising few dollars with February tonnage sold at 275$-278$ per MT ..FOB Yuzhnyy. Baltic prilled urea prices are also quoted over 270$ per MT FOB, and producers now seeking over 280$ per MT. Latin American and Turkish demand is buoyant, supplies tight and expectations that India will announce a new urea tender growing by the day.

The change in traders’ attitude has been prompted by a number of factors:
 Sales have been possible in Latin America at $270pt fob and above.
 Prills Urea are cheap compared with granular urea.
 Hopes that India will tender are growing as the stock position in the country is becoming critical after the failure of the December tender.

Egyptian granular urea prices eased back slightly this week to 328$ per MT FOB compared with 330$ per MT in previous week. However, the latest increase in CAN prices in Europe reflects a netback of 350$ per MT FOB for Egyptian urea product and further price increases seem assured in February. Middle East urea product is solid at 315& per MT FOB for spot and Chinese quotes have moved above 320$ per MT FOB.

Sources: Argaam, Profercy Report, Fertilizer-index.

Fertilizer Prices Report

16. January. 2010
Weekly Updated

Urea fertilizer prices in the market stood at the same rates of the previous week for both middle east(315$/MT) & black sea(275$/MT), in the usual buyers warned that accompanies the beginning of each new year to monitor the market hoping to lower fertilizer prices or at least price stability at fair and reasonable level to start purchasing.

** All the prices are FOB.

The Urea is "prill".

Fertilizer Prices Report

8. Jauary. 2010

Weekly Update

Urea prices are a little firmer heading into the New Year. Both middle east & black sea having recovered from the pre-Christmas slump. Traders aiming to push prices down have been disappointed and prices bottomed out at 315 USD/MT FOB for middle east urea & at 275 USD/MT FOB for black sea urea.

Short covering by traders accounts for the run up in price. Now that this is complete it remains to be seen whether demand is strong enough worldwide to lift prices any higher.