Wholesale fertilizer prices are expected to continue to rise due to lower production and higher international demand



In late August, urea levels in New Orleans, Louisiana (NOLA) were between $ 420 and $ 430 / t FOB, quickly reaching $ 550 after the first week of hurricane impact assessments has reached the market. By the middle of the month, after a brief relatively stable period, however, a combination of prolonged production downtime, continued challenges for barge logistics, and extremely bullish fundamentals overseas pushed urea to rock bottom. highs reminiscent of 2012 and 2008. September barge values ​​ended between $ 599 and $ 650 / t FOB.

River terminal prices followed suit, with relatively moderate activity before all of the supply difficulties became apparent. Motivated by those to complete contracts or start buying in the fall, the ensuing product scramble pushed prices up to $ 675- $ 700 / t FOB, more than $ 200 more. until the end of August.

Towards the end of September, it became evident that those who did not have an urgent need for urea before spring had mostly withdrawn from the market. The higher prices shocked distributors and retailers, who on a few occasions during the month withdrew fertilizer offers altogether as the commercial market moved too quickly to keep pace.

Unless the natural gas crisis is resolved overseas, among other factors, higher nitrogen prices appear to be the new normal for winter offerings, our urea price outlook short term remaining firm with the potential to stabilize as fall needs are met and potential buyers stay. wait for spring in the hope of lower prices.


As mentioned above, the natural gas crisis in Europe and the announcement in September of another tender in India dominated the news during the month, and supply disruptions here in the United States. States have also helped push up prices.

For its part, Brazilian urea prices fell from $ 615 to $ 700 / t CFR at the end of the month, from $ 470 to $ 475 in August, with the world’s largest buyer set to compete with India and the states. United for available supplies. On the other hand, the main Egyptian exporter, ending September at $ 610- $ 620 / t FOB, also recorded significant gains, but was limited by the increase in freight rates as well as the producer having already sold most of its volumes and comfortable enough on sales to withdraw offers.

The other big factor in the preparations for September was the Chinese government’s announcement of tougher export restrictions and customs regulations from November 1, which means the window for India to get more volumes got reduced.

In the near term, global urea prices look bullish given all the strong fundamentals involved.


September was largely a slow month for UAN, not because there was no demand, but because no producer had availability until month-end, if necessary. Virtually no seller had UAN to sell, and those who did were reluctant to do so without knowing their replacement costs.

The outage at Donaldsonville was a major concern before CF announced it had restored ammonia production and was working to restore UAN and urea upgrades.

On the last day of September, CF released long-awaited UAN offerings at its US terminals and production sites for fourth-quarter shipment, at levels of around $ 425 to $ 435 NOLA equivalents depending on location. Most of the bids focused specifically on the November to December period and were heavily allocated with bids drawn before the weekend. CF’s latest bids were at $ 320 / t FOB NOLA.

The higher bids pushed river terminal volumes over $ 100 from previous bids to $ 455- $ 460 / t FOB for 32% UAN at major river sites in St. Louis and Cincinnati and equivalent levels in whole system, approximating liquid to urea in terms of value per base unit of nitrogen (see graph accompanying this article).

Plant volumes were difficult to locate after CF pulled its offers, but were reported in line with terminals at $ 455- $ 460 / t in eastern Oklahoma. No offers were made from the CF plant in Port Neal.

UAN prices are expected to remain strong on a bullish nitrogen complex as a whole, as fewer and fewer volumes are expected to come from Trinidad and Tobago and Russia as the US government’s anti-dumping case closes. continues. The next developments are expected in late November, when the US Department of Commerce announces its initial subsidy rates for foreign UAN production, which may reflect equivalent tariff rates across the board, unless revised.



The main impact of Hurricane Ida on phosphates in the United States was the announcement by Mosaic that due to the storm, September phosphate production is expected to drop by about 300,000 tonnes. The continued blackouts at some of Mosaic’s facilities in Louisiana, coupled with the fact that no seagoing vessel could unload imported volumes for a while, put a huge supply shortage on MAP and, to a lesser extent, DAP .

The tight supplies seen so far for much of the year became even more exaggerated in September, with MAP barges reaching $ 730 to $ 765 / t FOB NOLA, about $ 100 more than the previous month. DAP barge prices, meanwhile, increased from around $ 50 to $ 650 – $ 675 / t.

River terminal equivalents for DAP and MAP also increased with particularly tight supplies at inland terminals. DAP volumes fell from $ 710 to $ 725 / t, compared to $ 635 to $ 650 at the same time in August, while MAP finished between $ 750 and $ 800 / t, or $ 50 to $ 100 of more than one month to another.

Some market players say they are unable to find quotes for MAP from major vendors for the remainder of 2021 in shorter domestic markets, a trend likely to continue ahead of fall requests as many are still trying to find enough. of products to meet previous contracts or push delivery dates further. The DAP is not as tight but remains tight, but with China now restricting its phosphate exports, it will only be much more difficult to source additional products from overseas.

Phosphate prices are expected to remain firm in the near term due to these extremely bullish factors.


The international phosphate market is grappling with a problem similar to that of urea with the reduction in Chinese exports which is expected to put a stain on world supplies.

India has seen strong demand for DAP for its next harvest, as prices hit $ 674 to $ 678 / t CFR in September, up $ 40 from August levels when demand was just starting. to come back. Brazil MAP, meanwhile, softened to $ 715- $ 720 / t CFR, $ 10- $ 15 lower than in August, where demand was relatively weak compared to the sharp increase in prices in United States.

Prices in the United States were so relatively high, in fact, that several cargoes from Russia subject to the 9.19% import tariffs adopted earlier this year were financially viable, and at least three ships have been booked. .

Given the squeeze in supplies expected from China’s downturn relative to the market, phosphate prices also appear to remain firm for the remainder of the year.


Potash markets were slow in August and remained generally slow in September. Values ​​rose to nearly $ 100 / t again like some other fertilizers, but most of the business was done by traders, many of whom had either already purchased fill volumes or had chosen to wait for winter in the hope to see prices drop.

NOLA granular potash barges reached $ 640 / t FOB, up from last confirmed transactions in August at $ 550 / t. A lack of supply and bottlenecks for import loadings in the Gulf kept liquidity low in the first half of the month, but there were a few transactions for October and some loaded barges were processed in the month. second half of the month.

River terminal price equivalents continue to evolve at the same rate as the Gulf even though replacement costs have not yet quite caught up with products stored in warehouses purchased at lower values. $ 670 to $ 700 represents the range of offers at major terminals along the Mississippi at the end of the month, up from $ 590 to $ 615 in August.

Belarusian potash volumes have helped keep the United States from lagging too far behind on imports this year so far, but that is expected to end after December, when sanctions prevent volumes from being shipped out of ports. Lithuanians. Russia said it would help the producer find another export route, but US sanctions on the Belarusian product are expected to further reduce the available supply.

The outlook for US potash is firm in the near term, but may see some relief in the medium term as Mosaic and Nutrien continue their efforts to expand their production capacity in North America. The new volumes are expected to start hitting the market early next year.


Editor’s Note: This information was provided courtesy of Fertecon, Agribusiness Intelligence, IHS Markit.



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