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In Europe, the nitrate market feels on the cusp of a wave of demand emerging with the urea markets providing a positive backdrop for the first time since September.
Producers and distributors have noted demand surfacing, with product selling at prevailing offer levels. The scale of business thus far has been modest. Still, this is a positive development for producers and suppliers as nitrate markets have been inactive for several months.
Indeed, suppliers are cautiously optimistic about near term prospects. The main priority appears to be towards filling order books and securing market share ahead of trying to push through prices increases.
To that end, CF Industries even cut offer levels this week for its domestic AN output in the UK.
The producer issued new prices at £320pt cpt merchant for March and April deliveries with a £5pt discount for upfront payment. The latest price undercut imported AN which had been on offer in the UK at around £340-345pt cpt farm for several months.
At the beginning of December, CF withdrew from the market with prices at the time at £370-375pt cpt merch for February/March shipment.
Of note, the latest price developments in the urea and AN market reduce AN’s premium per unit of nitrogen from around 35% to 27%.
Elsewhere in Europe, values have been stable. In France, AN is valued around €365pt cpt bulk while in Germany, CAN values are put at €285-290pt cif bulk for domestic product. Imported CAN from eastern Europe has been selling for €280pt cpt.
By Michael Samueli, Head of Nitrates
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