FERTILIZER MARKET REPORT February 10, 2023

Average January Urea Western Canada Delivered Price Still Quite High

The average Urea Western Canada delivered price was still quite high in January relative to the 10-year historical average prices for the month.

We were calling for C$775-C$800/mt in Western Canada. While prices fell to that level early this week, we believe it could go down further.

North America Urea Last Two Weeks

According to Green Markets, urea delivered Western Canada price last week was flat week-over-week in a range of C$840-C$900/mt. This was so for the third week in a row.

It finally happened as we have been forecasting. Early this week, urea pricing in Western Canada dropped to C$745-$800/mt DEL for February-March tons, well below the last confirmed C$840-$900/mt DEL range.

According to Green Markets, last week, NOLA granular urea prices were reported in the US$340-US$360/st FOB range, down from the week-ago US$340-US$392/st FOB. Early-week numbers were put at the higher end of the range at US$350-US$360/st FOB, with prices hitting the US$340/st FOB mark later in the week.

Early this week NOLA urea prices were put in the US$310-US$340/st FOB range, down from the week-ago US$340-US$360/st FOB.

North America Phosphate Last Two Weeks

According to Green Markets, last week, players noted softer values on the week’s NOLA barge phosphate markets, with both DAP and MAP prices slipping in the face of lower import and open-origin offers. MAP barges said to be of Russian origin were reported trading at US$585/mt FOB, below the week-ago US$595/st FOB floor. NOLA MAP barges were called US$575-US$615/st FOB, down from US$595-US$615/st FOB in the prior report.

This week, NOLA DAP/MAP was quiet in early week trading.

Green Markets Global Macro Comments

India

We have been confused for weeks about how this new approach taken by India for its urea supply will impact the global pricing mechanism. Turns out that we are not alone.

The new type of importing adds to the list of changes in India that will keep the market guessing as to how the pricing mechanism would impact the global urea market.

The IPL tender, calling for 600,000 mt to be shipped over a one-year period, closed on Feb. 1. As Green Markets went to press, no data from the tender was available. The tender was an unusual move, but one apparently designed to secure a steady supply of urea at rates lower than seen in the market’s occasional large spot tenders.

The urea industry is still waiting for word that a spot tender will be called. Bets are still being placed on the call to happen in the last half of February.

Brazil

Expectations of a softer market were borne out by prices reported at US$390-US$400/mt CFR. Sources said the downward drift is not yet done, as aggressive buyers are now pushing for tons in the US$370s/mt CFR.

Early this week, Urea prices were in free fall in Brazil as they declined US$40/mt to US$350-US$360/mt CFR from the week-ago US$390-US$400/mt CFR.

Industry Tidbits

• Low gas prices in Europe and the US are keeping pressure on ammonia markets.
• Canada’s Minister of Innovation, Science, and Industry François-Philippe Champagne on Jan. 30 announced an investment of $100 million through the Strategic Innovation Fund to support BHP’s C$7.5 billion project to develop its world-leading low-emissions potash mine.