12/19/2024 Mid-Day Fertilizer Market Update
International
- India urea purchase tender offers have been submitted…not that anyone knows any details
- NFL has yet to release any information
- I’m not talking about they haven’t released the comprehensive breakdown of offers
- I mean they haven’t released anything
- No tonnage total
- No L1’s
- Nada
- Sounds like the hope is that we will see total tonnage and L1’s tomorrow
- Might see breakout over the weekend
- I must run 20 miles on Saturday and 8 miles on Sunday
- My last big weekend before tapering and the races Jan 9/10/11/12
- I will most likely be too exhausted to watch for the info!!!
- Regardless of India, continuing to see price support
- Egypt sold higher once again, hitting $393 this time
- January AG futures traded up to $365
- Still no change on Chinese exports
- Still no change on European production rates
- Still no change on overall global demand
- I continue to get asked just how high it can go
- My POV is that the urea world is in worse supply shape today than it was in late ‘21/early ‘22
- Back then, there was a lot more emotion at play
- Folks were scared we would lose Russia, and many exporters were scaling back as a protective measure
- However, when breaking down actual S&D, many of the fears didn’t happen
- Today, actual production and exports are being lost, but has been largely ignored
- Hard to get overly excited about higher prices when grains keep stinking
- Just a wonder of what happens when the fundamentals take over…
- Paper trades today
- January Middle East Urea @ $362/$362/$365 (up $5 from yesterday’s settlement)
- January Brazil Urea @ $365 (up $1 from yesterday’s settlement)
North America
- The most surprising thing to me regarding N.A. phosphate isn’t the high price
- Rather, it is the relationship between DAP and MAP
- We haven’t seen a lot of DAP trade recently, but would call NOLA barges $575 to $580
- However, we did see a pair of January ship MAP barges trade at $590
- That means the DAP/MAP spread has narrowed back to historic norms
- Heck, that is cheaper than historic norms (MAP $20 premium)
- Until import flows normalize, I think we continue to see that pendulum swing violently as the market shifts back and forth
- Moving between DAP and MAP is hard
- Many retailers only have so much space that is broken into only so many bins
- You must completely empty the bin to switch over
- Then you must tackle the issue of a product with a different analysis
- When MAP was $100+ premium, it made sense to bear the switch pain
- Now we must wonder how many will switch back to MAP
- Isn’t fertilizer fun?
- Another down day for grains
- December 2025 corn fell to a low of $4.31 before battling back to $4.32 as I write this
- Puts a lot of the ratio values high
- Urea @ $327 = 76
- UAN @ $245 = 57
- DAP @ $580 = 134 ratio
- Graphs are below to make the comparison to what is considered “normal”
- I can save you time and just tell you they are all high
- Paper trades today
- No trades observed
- Physical trades today
- January NOLA MAP at $590/$590
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