Profercy World Nitrogen Index

Week 36 – Granular urea values supported by ongoing supply disruption and firm energy and grain values

Values for granular urea are on a strong footing with support from continued supply disruption in the Middle East ahead of an anticipated uptick in demand for October onwards shipments from a number of western markets. The Middle East conflict has contributed to firming energy values, with nearby Dutch TTF values at multi-year highs. Grain values also remain supportive.

Liquidity has been relatively light over the last week, with Brazilian buyers slow to accept higher levels and Europeans content to withdraw existing stocks. However, trade values for granular urea in Brazil have still advanced more than $75pt since mid-August. While European demand for fresh vessels was not initially buoyant, an uptick in inquiries has helped push North African values marginally higher after they held steady for a week.

The US market, as ever, has been highly responsive to international developments, which together with demand for pre-river close barges, saw Nola prices move on average $18.50ps ton higher on the week. Nola values reflect a moderate premium to the Brazilian market, making the US increasingly more attractive to offshore suppliers.

In the east, granular urea supply remains tight with vessel movement through the Strait of Hormuz restricted and Chinese granular urea volumes running low. Chinese prills remain available and are trading at a $60pt discount to the country’s granular product owing to the lack of any major outlets, with India currently absent from the market.

The Profercy Nitrogen index is up 2.95 points on the week to a six-week high of 216.56.