Insight Focus
- Prices fall at Indian urea tender
- Lack of demand, May/June shipments weigh on Latin American phosphate prices
- Brazil potash prices hit record high
Global fertiliser prices are falling because such historically high levels are denting demand.
This trend may continue over the next few months as summer approaches in Europe and North America, a slow time for the market because many crops are at a stage where fertiliser is no longer applied.
The result of the urea tender by India’s Rashtriya Chemical & Fertiliser Ltd. illustrated the downward price trend. FOB netbacks to the Middle East fell around USD 35 to below USD 700 a tonne, disappointing producers and traders with long positions who had hoped for stable-to-higher prices. India is a major urea importer, making any tenders from there a key market factor.
Latin American Phosphate Prices Drop
In Latin America, prices of diammonium (DAP) and monoammonium phosphate (MAP) plunged on lack of demand. Massive price differentials are incentivising producers to ship material to markets East of Suez where prices are higher.
However, a number of producers and traders are targeting Latin America for May/June shipments, putting further downward pressure on prices. Brazil’s MAP prices dropped another USD 70/tonne in the last week alone and average prices dropped as much as USD 165/tonne over the past four weeks.
In India, the Department of Fertilizers rejected attempts by buyers to purchase DAP for more than USD 920-925/tonne CFR, USD 100 below sellers’ offers.
Brazilian Potash Prices Rocket
Potash prices hit historical highs in Brazil last week at USD 1,150/tonne CFR. Belarus, which in a normal year exports around 9 million tonnes of potash, is absent from the market due to sanctions. Russian products sold to Brazil and China, albeit not directly subject to sanctions, are limited due to sanctions on banks as well as shipping constraints.
