From the Fertilizer Works weekly wrap up ... www.fertilizerworks.com
Urea Urea prices have continued to move up in all areas this week. Turkish buyers came into the market in the middle of the week and concluded 50-60,000 tonnes at prices reflecting above $360/tonne FOB Yuzhny. Yuzhny prices are at $370/tonne FOB and are being closely shadowed by the Baltic. Brazil is expected to be the next major buyer and will face prices above $420/tonne CFR.
Traders have sold more Chinese urea to west coast Latin America at prices netting back to the low-$300s/tonne FOB. Chinese prices are firm, in part due to domestic demand. However, traders are reluctant to buy material for second half December shipment due to the risk that shipping delays may push loading into January. Egyptian urea keeps setting new price records. Deals are reported this week at $417/tonne FOB rising to $425-430/tonne FOB for December loading. Traders feel safe booking Egyptian material because the US market is showing considerable strength for Q1 and plants are down in China and Venezuela. US granular urea prices have risen to $430-435/short ton FOB for January, equivalent to $470/tonne CFR. Europe remains a major buyer for granular urea, with levels equivalent to $470/tonne CFR paid in France this week. Yara has announced €15-20/tonne price increases for ammonium nitrate and CAN in European markets this week. North America In the US, prompt barges of granular urea are priced around $420-425/short ton FOB. International demand and the weaker dollar were among the reasons for the firm prices. Forward pricing is also healthy, with December barges heard traded at $421/short ton FOB Nola and January tonnes available at $426-430/short ton FOB Nola. Urea consumption is steady but not excessive, running close to forecast for November. Production problems continue to affect PotashCorp's Trinidad plant, with mid-November shipments to the US Gulf now put back to early December. DAP Prices for phosphates continue to move higher, encountering little resistance from buyers. North African DAP has sold at $525-530/tonne FOB this week for December shipment. US export prices are put at $520/tonne FOB. Domestic prices have jumped to $460/short ton FOB Nola on news of potential production losses in Florida. The market remains short of DAP and MAP. Buyers are aware of this and are starting to look for forward cover where possible. Discussions have already begun in India about shipments for Q1 2008. Indian production is failing to meet target levels and the government is anxious to ensure a more regular flow of DAP into the country next year. In Europe, importers have sold DAP at over $600/tonne FOB Terneuzen for January delivery. The first time such a level has been achieved. Ethiopia is in the process of buying 75,000 tonnes of DAP and has issued a tender for another 75,000 tonnes. Iran has issued a tender for 120,000 tonnes of TSP and 30,000 tonnes of DAP for January-February shipment.
DAP at $500 FOB and still rising
North America In the US, Mosaic is reported to have sold DAP at $520/tonne FOB for export. The DAP market remains active. Dealers are buying to cover prompt usage, while traders are building positions for January. Spot prompt barges traded at $452-454/short ton FOB Nola early this week. Subsequently, news of an ammonia leak in Tampa sent prices up to $460/short ton for second half November barges. In the forward market, DAP barges are at $465/short ton FOB with more buyers than sellers evident. Traders have been bidding CF at $465/short ton for January-February positions.
