International ammonia prices maintain upward march on capacity constraints

Bullish sentiment remains the dominant theme across the global merchant ammonia market against a backdrop of planned and unplanned plant outages that have taken a large bite out of export volumes in key regions.

Industry majors Yara and Mosaic just settled the Tampa contract for October loadings at $590pt cfr, up $50pt from this month’s figure of $540pt cfr, with the agreement widely expected given recent spot business in North Africa and Northwest Europe at higher levels to last done.

In addition, the settlement of the US benchmark at its highest level since late 2023, comes as Mosaic prepares to take delivery of several offshore spot cargoes for its Florida terminal due to a turnaround at its 450,000t per year plant at Faustina, Louisiana.

The phosphates producer does not comment on its raw materials procurement, but two tankers with a combined carrying capacity of 52,000t are currently heading to Tampa from the Caribbean.

Firmer spot prices were also achieved by Algeria’s leading exporter, Sorfert, last week when a string of deals was done with traders for delivery to Europe, a development that immediately pushed up supplier price targets in the latter region.

That series of sales, which comes amid capacity constraints in the Caribbean, was headlined by a deal at $580pt fob for 30,000t split across two liftings for late October and early November.

Prior to that deal, Sorfert sold a 15,000t cargo to Trammo at $565pt fob for October loading and an identical-sized cargo to an unidentified party at $570pt fob.

Saudi supply squeeze now being widely felt

Upward price pressure has also been very visible in the East, where the unplanned shutdown of a Saudi plant will remove at least 300,000t of merchant material from the market between late August and the end of the year.

This was underlined by Trammo’s purchase of a 10-15,000t November cargo from Sabic Agri-Nutrients at $420pt fob, with that figure up around 25% on recent term netbacks to the Kingdom’s suppliers.

While Indian consumers of ammonia are well served by discounted material from Iran, next business for tonnes of non-sanctioned origin are expected to average around $450pt cfr, depending on the disport.

Further east, with turnaround season at many chemicals producers about to commence, the loss of the 100,000t per month of Saudi product will be offset to some extent, while export availability from Indonesia is returning to normal following plant maintenance.

By Richard Ewing

Head of Ammonia/Deputy Editor at Profercy