It’s difficult for industry watchers to predict but fertiliser prices have dropped in Brazil US/NOLA and the Baltic region where demand is subdued
For our local market it appears most growers will have to rely on supply from the Federal Government partnership with Incitec Pivot, CSBP and Summit Fertilizer with total volumes secured under the scheme to date at around 340,000 tonnes.
Regardless of the continued reports about the Strait of Hormuz being open and vessels getting out of the spiderweb, global market analysts describe these reports as false, with tanker transit activity extremely constrained with less than 10 vessels a day escaping.
It is because of these false reports of normal shipping activity that across nearly all world markets buying fertiliser we are seeing Urea prices dropping, along with phosphate beginning to show signs of a fall, while potash prices are following suit and ammonia prices have already been reduced.
The false reports of normal shipping have seen substantial price falls now evident across Brazil, US/NOLA, and the Baltic region even though demand has remained somewhat subdued with growers hesitant to forward order commit.
Even with the signing of the US-Iran memorandum of understanding, shipping is still stuck in the Strait of Hormuz and continues to dominate market sentiment. And experts caution that a return to normal vessel flows could take up to 12 months.
Here is a summary of the produce trend and current price averages growers worldwide are paying.
UREA
The indicative price range for urea is US$340 to $480 tonne. (AU$485 to $685 tonne)
It is estimated as much as one million tonnes of urea is trapped aboard vessels trying to navigate the Strait of Hormuz. Producers have reportedly continued loading material for shipment, and the sudden release of product would quickly reduce prices. But it has to get here first.
Iranian FOB values have reportedly been seen as low as US$345 PMT. India’s latest NFL tender has secured just over 1.7 million tonnes. Demand across Southeast Asia remains largely dormant, while Petronas is said to have sold 30,000 tonnes at US$480 PMT FOB compared with US$790 PMT FOB in early May.
Brazilian values continue to ease, with a 40,000‑tonne sale reported at US$400 PMT CFR. US/NOLA values have also dropped sharply, with FOB barge prices reported at a 17‑month low of around US$340 per short tonne.
In summary, urea prices will remain under substantial pressure, and it will depend on a reopening of the Strait of Hormuz and substantial shipping flow and orderly release of delayed cargoes.
PHOSPHATES
The indicative price range for urea is US$900 to $935 tonne CFR (AU$1285 to $1428 tonne)
Global phosphate prices are mostly stable, although individual benchmarks moved in both directions as buyers continued pushing for reductions despite exceptionally tight supply and historically high raw material costs.
US DAP and MAP prices fell further across both NOLA barge and Midwest markets. Brazilian MAP prices remained steady for the ninth consecutive week at around US$900 PMT CFR.
India’s spot DAP assessment was also steady at US$930 to $935 PMT CFR. Pakistan DAP prices fell from the US$960s PMT CFR to the US$920s PMT CFR.
Granular phosphate prices are expected to remain relatively stable in the short term as buyers remain cautious. Exceptionally tight availability of both finished product and raw materials is expected to place upward pressure on prices over coming weeks and months.
POTASH
The indicative price range for urea is US$400 to $481 tonne CFR/FCA (AU$570 to $687 tonne)
Potash prices in Brazil eased this week amid thin trade and hesitation from buyers to commit to further purchases.
Suppliers are expecting prices to rise as demand picks up for winter croppers between August and September. Southeast Asia remains quiet and stable, while regional imports are down around 21% year‑to‑date.
China continues to import heavily, with year‑to‑date imports running approximately 30% above last year’s level. MOP prices are expected to rise in the near term due to tight supply, with many suppliers largely sold out until August.
AMMONIA
The indicative price range for urea is US$400 to $481 tonne CFR/FCA (AU$570 to $687 tonne)
Ammonia prices softened across most regions this week as returning Southeast Asian supply, sharply lower Chinese export offers, and the recently announced US-Iran agreement weighed on sentiment.
In India, indications eased to around US$800 PMT CFR. East Asian spot values moved lower, with July offers into Taiwan heard around US$770 PMT CFR.
Southeast Asian offers corrected lower to around US$730 to $750 PMT FOB following the return of PAU and Petronas supply.
Prices are not expected to get back to normal until all ships escape the Strait of Hormuz and no-one can accurately predict that date, including the people who started the war.
