Commodity online exchange Kyiv Mercantile Exchange – KME: the results of the third week of July 2019 in the markets of mineral fertilisers in Ukraine and the world.
News overview in the world fertiliser market. Main events of the week:
- Indian tender postponed cuts on urea prices
- Prices for ammonium saltpetre remain stable
- Prices for phosphate fertilizers remain unchanged, the low trend is in the markets of China, Brazil and India
- Stabilization of ammonia prices is already taking place
The world market prices for ammonia are already stabilising. In part, this was the reason for the increase in quotations for urea. But the main reason for the growth in demand for urea was the increase in the volume of procurement at the Indian tender to 1.7 million tons. This led to an additional search for product volumes, as traders did not risk buying urea in advance.
Therefore, India has once again become the cause of the spot price increase. Such a rise in prices does not occur. Instead of lower prices for August-September, manufacturers set for buyers prices from the first half of the summer, when growth was caused by purchases in the United States.
In India, MMTS will buy 1.7 million tons of urea. This volume is enough to keep the price at the level from 285 USD/t, CFR.
The lowest prices will remain in the Baltic and the Black Sea, other suppliers have competitive advantages, because the goods are needed right now.
The price for ammonium saltpetre remained at 205-213 USD/t, FOB – Baltic/Black Sea. Nevertheless, the demand is low, there are almost no deals. In the markets of Eastern Europe demand for saltpetre will be formed not earlier than in August. In the autumn it is two to three times lower than in spring, but in summer, the purchase of saltpetre will start in the spring of next year.
The decline in prices for phosphate fertilizers has so far stopped, although the mood of major buyers – India, Brazil and China remain unchanged, despite rising pricest for potassium chloride.
NPKs will be popular in 2019, the overall trend is expected on a slight, gradual increase in prices. Ammophos, according to IA Info Industry, can be bought for 350-355 USD/t, FOB-North Africa.
News overview in the Ukrainian fertiliser market. Main events of the week:
- The Ukrainian market shows an increase in NPK activity
- The DniproAzot is launched, the OPZ is being prepared
- Traders’ warehouses become empty from old NPK stocks, the new ones are delivered relatively slow
- The Federation of Employers collects market participants at President Hotel for a press conference on the fertilizer market.
A conference will take place in Kiev on Thursday, July 25, where the Federation of Employers, together with the Union of Chemists, is going to talk about further steps in the fertilizer market.
The embargo, which has hit hard on traders, forces to search for new ways of providing the market for fertilizers, including domestic ones. Now it is known about new NPK ship batches from Europe. Traders do not sleep, however, according to expectations of IA Info Industry, prices will be higher by 30-50 USD/t.
The DniproAzot has started and has already come to full power. From August 1, the market is waiting for the launch of the OPZ. These two plants will supply urea to the Ukrainian market. It is expected that in the domestic market they will be able to sell at least 70 thousand tons of their products in August, and part of the goods will be exported. In the future, the surplus of products will accumulate in the spring, because the market needs for the fall can be closed by the development of the two leading three factories in two months.
Issues of development of export potential are becoming acute for the Ukrainian chemical industry, because survival is not possible at the expense of the Ukrainian market, chemistry needs export for development. Perhaps in the near future the gas rubicon will be resolved.
At the moment, traders record a quick sale of products from warehouses, and replenishment of stocks is relatively slow. New volumes are produced and imported relatively slow. Stocks are 2-3 times lower than last year.
Belaruskaliy will raise the price of potassium for Ukrainian consumers by 10-15 USD/t, from August 1, 2019. This increase is corrected with the global market trends, but less than the NPK market in Ukraine.
Note that the review is made on the basis of data from the tenders and applications for the purchase and sale of the commodity online exchange KME and data analytical group Info Industry.
For reference: Kyiv Mercantile Exchange – the newest Ukrainian online exchange. Realises the world standards of stock trading in the Ukrainian markets of agricultural, chemical and petroleum products. As of end of May 2019, the total turnover of trades in Kyiv Mercantile Exchange exceeded UAH 6,3 billion.