12/20/2024 Mid-Day Fertilizer Market Update
International
- Got the 1st round of information regarding India’s urea purchase tender
- They were offered 2.6M tons
- That’s it
- That’s all the information that was shared
- Looks like the information should be released on Monday…
- 2.6M tons may seem like a big number, but bear in mind that they are looking for 1.5M tons
- 2.6M doesn’t feel like a surplus number of tons
- Still need to be patient and see what happens with awards
- If you haven’t had a chance, check Mike’s report on China and India trade activity for November
- For November, China exported a massive 2,220MT of urea
- This maintains the “China isn’t back” narrative
- Now, phosphate exports from China were decent
- Just over 800K tons “released”
- Much bigger than normal for November
- That brings their calendar year 2024 cumulative total to 6.2M
- Seems decent, until you remember they used to export 10M
- Their potash imports remain huge, with 1M ton imported
- Yet global values remain flat to soft
- Doesn’t inspire confidence in higher prices in the future
- For November, China exported a massive 2,220MT of urea
- Paper trades today
- no trades observed
North America
- Biggest shock to me in the last 24-hours is the announcement of further USDA grants into the fertilizer world to lower prices
- If you remember a couple years ago, it was announced that $250M worth of grants would be made available to help lower fertilizer prices
- Eventually, after everyone laughed, they pushed it to $500M
- Since then, we have seen:
- Nitrogen values be volatile and currently high priced vs grains
- Phosphate values be extremely historically high priced and look to set all-time high corn/DAP records for Jan/Feb
- Potash values cratered and have remained very well priced
- Guess which product an $80M grant was just announced…potash
- Now, this is great news for farmers in Michigan and surrounding areas
- My issue is the fact that potash is already well valued
- We also already have plentiful supplies in Canada
- We need major help in nitrogen and phosphate…
- Speaking of help
- Lower Florida production restrictions on expanding area
- Mosaic has proven that a responsible company will help reclaim the land after it is used
- They built one of the nicest golf courses around on top of old mining land
- We are also seeing Florida being willing to use the gyp stacks in road construction, so those will hopefully go away
- 85 – 90% of global production/export of phosphate lies with 5 countries
- Time to be less reliant on the world
- For nitrogen, N.A. has some of the lowest gas values in the world
- Why are we not producing more here with new entrants?
- If the environmental concern is stopping it, build it at home where we can control it
- If we allow the world to do it, it will be built using their environmental standards…or lack of
- We are a net importer. Should be making it here.
- Lower Florida production restrictions on expanding area
- Otherwise, aside from my rant, nothing happening today as the market waits on India
- Outside of that, hard to see much happening over the next two weeks with holidays
- I would keep a very close eye on the markets the week of January 6
- Everyone should be back from vacation
- The calendar will show 2025 which will make spring feel just around the corner
- I know I’ve already started thinking about when to open the pool!!!!
- Paper trades today
- no trades observed
- Physical trades today
- no trades observed
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