Brazilian MAP prices holding despite surge in P2O5 stocks
A pair of premium-priced fob spot sales to Trammo by leading producers in North Africa and the Middle East were the main events in an otherwise relatively quiet week for the merchant ammonia industry.
Against the backdrop of major capacity curtailments in Saudi Arabia and limited loadings in the US Gulf this month, the trader felt it had little option to pay higher prices to secure tonnes from Algeria’s Sorfert and Saudi major Sabic Agri-Nutrients at $550pt fob and $430pt fob, respectively.
In addition to the above, the same buyer also picked up some spot parcels from Turkey’s Gemlik and China’s Dalian HengLi for prompt loading.
In the Black Sea, while 10-15,000t of Odessa Port Plant (OPZ) spot material is being offered for loading at Yuzhnyy in late September/early October, buying interest is limited given high insurance costs and many vessel owners’ ban on Black Sea activity.
Prior to the outbreak of conflict in February 2022, around 200,000t per month left Yuzhnyy on average, well down on totals from previous years, although such cargoes were still regarded as a global pricing benchmark.
UN efforts to restore Russian ammonia shipments from the Ukrainian port formed part of plans for grain supply negotiations, but no progress was made, and local media later said the lengthy Togliatti to Yuzhnyy ammonia pipeline had been badly damaged.
Prices also jump in East on supply cuts
The reverberations from Ma’aden’s plant problems – the Saudi producer will lose about 140,000t combined this month and next – have now reached Southeast Asia as surplus volume is drying up.
In a rare move, a large cargo was sold out of Indonesia on a cfr basis for the Americas, with an eastern trader understood to have sold around 30,000t to for discharge in west coast Mexico in late October.
The same supplier is heard to have agreed a two-month time charter on a mid-sized carrier to complete term deliveries to Northeast Asian buyers while its sole vessel moves the spot volume across the Pacific.
Whether the higher fob prices for the covering of term positions translates into greater cfr numbers for end users is unclear given the absence of major buyers in India, Northwest Europe, Northeast Asia and Morocco.
While the 2024 trend of capacity curtailments persists, soft seasonal demand from leading agricultural and industrial importers both sides of Suez means the immediate impact on pricing may be relatively limited.
By Richard Ewing, Head of Ammonia/Deputy Editor at Profercy
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