Indian Tender Could Help Soak Up Some of the Urea Inventory, but Supply is Heavy into December

Continue patience next few weeks – Waiting for the other shoe to drop


Last week, the NFL tender closed on Nov. 14 with 16 companies offering 2 million mt for shipment by Dec. 22. Ameropa offered the lowest price for an East Coast delivery with 90,000 mt at USD$578.77/mt CFR. Fertiglobe was the lowest offer to the West Coast with 45,000 mt at USD$573/mt CFR.

Almost exactly a year ago, IPL closed a tender that had some of the highest prices seen in an Indian tender. The West Coast price was USD$981.64/mt CFR and the East Coast price was USD$998.50/mt CFR. Prices have edged downward in the intervening 12 months, dipping to USD$517-$520/mt CFR in July 2022.

Initially NFL said it would take 600,000-800,000 mt because of budget constraints. However, once the prices were released, the Department of Fertilizer reportedly reviewed the situation and authorized NFL to take as many tons as possible. Estimates were that the buying house was looking for 1-1.2 million mt.

In the end, India opted to take 1.47 million mt of urea, which was more than expected, in its latest urea tender. Prices were $573-$579/mt CFR, down from the last tender’s $649-$655/mt CFR. There is much speculation that India may call another tender in December.


A stagnant market and a midweek holiday led to limited business in Brazil. Sources said the few deals that took place moved the market to $560-$600/mt FOB, with little hope of a price revival. Rondonopolis also saw a drop in pricing, to $705-$760/mt FOB ex-warehouse. Sources said the large stockpiles of urea, coupled with little demand from farmers, are affecting prices at the ports and at interior distribution centers. There is also uncertainty in the market while buyers and sellers wait to see what actions the new national government will take on agricultural issues.

Commentary from Argus

In ammonia, the spot prices continued to turn lower. The outlook is more or less stable in the month ahead as buyers watch some new demand emerge in SE Asia, Mexico and the US. So even with prices moving lower there does seem to be some demand emerging. European cfr prices are marginally lower with buyers and sellers about USD$50/mt apart. Gas feedstock prices are trending higher as we get into the winter months in the northern hemisphere. The overall outlook is for prices to continue to slip in most regions.

In urea, last week prices continued to trend down and sellers have capitulated and cut prices to secure sales. India’s tender was not that surprising with regard to prices at USD$573-578/mt but unusual with the lowest price set by a producer rather than a trader. Liquidity is minimal in other regions particularly Europe therefore producers are targeting heavy volumes in India. There is still heavy supply side for December. The overall outlook is volatile. If the demand in Brazil, the US and Europe does come soon, prices will be supported but producers do remain vulnerable to delays in demand in an otherwise well-supplied market.

In phosphates, we saw a bit of a new story emerge last week. For once, the DAP price actually moved up marginally due to South Asian demand and most notably India and Pakistan. DAP in South Asia is the premium cfr market globally because subsidized Indian buyers are back in the market for more DAP. India bought about 100,000mt from Russia, Saudi and China and this pushed the DAP price up a bit. West of Suez however is a different story. DAP in Europe continues to soften. In Brazil, MAP is under pressure with very little import activity. The same in the US with NOLA prices down to USD$630/st. The outlook is for DAP to be stable and then eventually soften as Indian buyers recalibrate prices levels with the rest of the world at the end of November.

North America Urea Last Two Weeks

According to Green Markets, last week, NOLA urea barges were reported at USD$505-$530/st FOB, down from the week-ago USD$520-$530/st FOB. Prices had already started to soften before word came on Nov. 16 of the much lower India tender prices. Lower NOLA numbers were heard again after the India news broke.

This week, NOLA urea prices dipped to USD$490-$520/st FOB from the week-ago USD$505-$530/st FOB. Urea pricing in the Southern Plains slipped as well to USD$575-$600/st FOB Catoosa/Inola, Okla., and USD$605/st FOB Houston, Texas, down USD$5-$15/st from last report.

Last week, the spread between low and high Urea prices were the stagnant through the week in Western Canada. Sources quoted delivered pricing in the C$1,040-$1,060/mt range.

This week, Urea prices as reported by Green Markets in Western Canada were stable week-over-week with little trade reported. Not surprising given the time of year.

THAT SAID, a major distributor dropped prices again WoW with carry into January of only $10/mt as far as I can tell. This gives me pause. Let’s talk next week.

North America Phosphate Last Two Weeks

According to Green Markets, last week, Central Florida phosphate producers were reportedly sold out of DAP and MAP through the first half of December. Posted DAP truck pricing continued at USD$770/st FOB, while MAP trucks were posted at USD$790/st FOB, steady from the prior report. Truck-loaded MAP offered from North Florida continued at USD$820/st FOB, unchanged from last week.

NOLA phosphate pricing fell for the week, sources said, as the combined forces of the impending winter navigation season and ongoing trouble on the inland river system limited trading at NOLA. Nearby NOLA DAP pricing sank to a USD$640/st FOB low, down USD$35/st from last week’s USD$675/st FOB floor, while sources described pricing as high as USD$665/st FOB, off from the prior USD$680/st FOB top. Limited MAP trades and offers were reported down to USD$630/st FOB for nearby loading, while some saw the market topping out around USD$650/st FOB. Week-ago MAP levels were reported at USD$650-$665/st FOB,. Domestic producers continued to report being sold out of NOLA DAP and MAP barges for loading through the first half of December. Tons located at upriver locations were drawing a considerable premium to NOLA, with some noting trades at or above a USD$700/st FOB NOLA-equivalent. Sources quoted the nearby DAP barge market at USD$640-$665/st FOB, down from USD$675-$680/st FOB one week earlier. MAP barge pricing was reported at USD$630-$650/st FOB, also down from last week’s USD$650-$665/st FOB range.

This week, NOLA DAP/MAP continued to soften. Prices were also down $10-$20/st out of warehouses in the Southern Plains and South Central regions.

Last week MAP pricing in Eastern Canada covered a broad range at C$1,180-$1,280/mt FOB in mid-November, while the latest DAP offers at Montreal were quoted at the C$1,170/mt FOB level, down C$10/mt from last report.

Last week, delivered MAP prices in Western Canada was flat week-over-week in a range of C$1,235-$1,270/mt FOB in Western Canada.

Industry Tidbits

  • Members of a third union – the International Brotherhood of Boilermakers (IBB) – have voted to reject ratification of the tentative agreement with the nation’s major freight railroads, according to a Nov. 14 announcement by the National Carriers’ Conference Committee (NCCC), which represents most Class I freight railroads in national collective bargaining.
  • The J.R. Simplot Co. is acquiring 15 agricultural retail outlets in Saskatchewan and two in Louisiana. Simplot has agreed to acquire G-Mac’s AgTeam, an agricultural retailer in Kindersley, Sask. Founded in 2000, G-Mac’s 15 retail stores will now be Simplot Grower Solutions locations.
  • The industry continues to await word on the Tampa ammonia price for December. Sources sense softness in the market due to lower prices in Europe, where low natural gas prices have prodded more ammonia plants to return to production. November was concluded at USD$1,150/mt CFR.