Fertilizer price sets new peak

The impact of the Covid-19 pandemic continues to cause trouble for fertilizer production in many countries. The price of input materials and transportation fees has increased to a record, making the global fertilizer price "exceptionally hot" in recent months and has now recorded new price peaks.

According to news reports of Argus and Fertecon, reputable international market forecast and analysis companies, during the week from June 18th to June 24th, the worldwide supply of urea remains in the status of scarcity, and prices continue to rise. FOB urea price in the Black Sea has increased to USD 420 - 435/ton, the highest rate since 2013 until the present date.

In China, urea trade price is currently around USD 435 - 445/ton; Middle East USD 450 - 460/ton. PIH Company (Indonesia) has just closed the shipment deal for Koch at the price of USD 458/ton, and the latest information reveals that India’s bidding package on June 24th for the shipment of over 1.8 million tons of urea has the lowest offer price up to USD 505/ton CFR.

In the upcoming July, the supply from major urea producing countries is predicted to continue to decrease as many factories carry out maintenance, Chinese exporters stop offering the prices, making urea prices likely to be pushed up. Even in the world, August orders are being offered at USD 470 - 480/ton FOB.

Along with urea, the world potash price also continued to increase in the context of tight supply and geopolitical fluctuations in some potassium exporting countries, some major distributors have stopped offering. The EU's expected sanctions on potash imports from Belarus continue to cause the price of this item to escalate. The delivery of potassium orders is also not guaranteed due to a shortage of containers.

In Southeast Asia, the bidding price for potash is currently USD 400/ton CFR for standard mop, increased to USD 430 - 450/ton CFR in Northwest Europe; USD 500 - 550/ton CFR in Brazil.

However, phosphate-based fertilizer products, including DAP and MAP, have been experiencing the biggest increase in recent months. Concerns about China's export tax rise and India’s strong increase in demand have made DAP prices in this country continue to remain high at USD 590/ton CFR.

The MAP price in the Brazilian market today is offered at USD 753-758/ton CFR. It is prognosticated that phosphate prices will continue to increase in some markets like how DAP China has offered shipments in July at a higher price than in June and many suppliers have temporarily not offered August delivery prices.

In regard to NPK commodities, the trade price of NPK 15-15-15 Baltic/Black Sea is currently at USD 370 - 445/ton FOB, Morocco USD 415 - 430/ton; USD 370 - 455/ton FOB for NPK 16-16-16 Baltic/Black Sea. These prices are all up compared to the previous 1-2 weeks. Some manufacturers even stopped selling to monitor market dynamics or sell inventory materials to lock in profits instead of producing NPK. In the context of input material prices showing no signs of slowing down, NPK fertilizer’s increasing price pressure in July continued to escalate.

In conclusion, looking at the whole picture from high demand to production input factors, the fertilizer price fluctuation in the world is forecasted to continue to experience a “hot rise” in July, which is even unlikely to “cool down” this year.