Global nitrogen values move higher, but Nola urea loses momentum

The international urea market has been calmer. Urea fob values have been consolidating, albeit price gains have been noted in the east. In many major western import markets, landed values are marginally higher on the week, except for the USA.

The fundamentals supporting urea have been consistent for some time. Export supply in the Arab Gulf is hamstrung by the ongoing conflict, European gas prices are high and grain values are at healthy levels. Caution in key markets, such as Brazil, has not undermined the resolve of nitrogen producers.

Traders have been willing to extend North African positions with Algerian granular again sold in the $540s pt fob. Those with positions have been placing modest volumes in Europe below replacement costs, but warehouse values are still advancing.

UAN and nitrate markets across Europe are also moving higher. Although there have been no further major production cutbacks announced by EU suppliers due to gas, production economics still look poor.

Elsewhere in the west, buyers have been reluctant to pay higher, albeit $500pt cfr was achieved in Brazil with offers still circulating at that level midweek.

Having traded at a premium, the US market has lost ground, holding over $450ps ton midweek, or $490pt cfr equivalent, before values slipped on 24 September. Barge values had surpassed $470ps ton last week owing to pre-river close demand. 

In the east, an abnormal wave of Australian spot demand has lifted SE Asian and Chinese granular prices. Granular has been sold at $450-455pt fob in China. 

Chinese prilled suppliers are once again looking to India with a fresh tender for 1.7m. tonnes closing on 7 October. Most expect heavy participation again from China, with few feeling India will need to fall back on granular suppliers, as it did prior to the 11 August tender.