It’s time to purchase saltpetre. There is a risk of scarcity

Overview of the market for mineral fertilizers

Commodity online exchange Kyiv Mercantile Exchange – KME: the results of the business week (January 21 – 27) in the markets of mineral fertilisers of Ukraine and the world.

Overview of news in the world fertiliser market. Main events of the week:
  • At the tender, India bought only 515 thousand tons of urea
  • The price for the imported saltpetre decreased in Turkey
  • There is the first decrease in prices for phosphoric acid
  • Quotations for the ammonia in the Black Sea remain stable

Ammonia prices are same on the Black Sea and the Baltic. At the moment, ammonia can be bought at a cost of less than 265 USD / t, FOB – the Black Sea, the price in the Baltic States – 282 USD / T, FOB. Stability is due to lack of ammonia and high activity in the East European nitrogen fertiliser market.

Buyers of ammonium nitrate for the next three weeks will buy most of the spring volumes.

Taking into account the massive purchase of the saltpetre from local producers in Eastern Europe, Turkey and Bulgaria began to decrease the prices of nitrate for export. In fact, the decline has already reached 30-35 USD from the price for December.

The Indian state company MMTS has bought only 515 thousand tons of urea, instead of 600 thousand tons. Part of the product is reserved by traders, already offer by a price of 280 USD / T, FOB. Nevertheless, the price for Chinese urea remained in the range of 285-287 USD / T, FOB.

Indian state-owned company and OECD (Morocco) agreed to decrease prices for phosphoric acid by 18 USD / ton. Despite the scarcity of phosphorus in the second half of 2018, at the beginning of the year, the balance of phosphorus raw materials was somewhat surplus. It is possible to hope that the prices for the phosphate fertilisers in eastern Europe will decrease in May.

Overview of the news in the Ukrainian fertiliser market. Main events of the week:
  • In Ukraine, sales of saltpetre are rising steadily
  • Nitrogen fertilisers remain in deficit
  • The Government does not foresee any restrictions on imports during the spring period

Imports of the fertilisers moved from the place. At the government meeting, the customs reported on the reduction of customs revenue and VAT when importing the goods. The government did not agree to go for a meeting with producers regarding import quotas and the introduction of special taxes. Meanwhile, clearance in ports is delayed by 7-10 days.

It’s time to buy saltpetre, there is a risk of scarcity. It is not worth to hope for cheaper saltpetre from Turkey. Turkish saltpetre is being purchased for delivery from the second half of February, so the product for the Ukrainian market will only appear in March when the season will be in full swing. Taking into account 10-15 days of transportation from ports to the centre of Ukraine, the saltpetre just won’t have time to enter the market. Who cares about the purchase of fertilisers in advance has the opportunity to make them on time.

Prices for saltpetre remain at the level of 11 300-11 400 UAH / ton, warehouse. Warehouse sales are increasing daily. The demand for saltpetre is already slowly growing in the West and South of Ukraine.

The analytical agency Info Industry reported about the supply of saltpetre from the Voronezh region. The first batch from Russia with a paid fee will soon be available in Ukraine. Experts do not expect mass importation of saltpetre in February from Russia.

Expectations of imports from Russia are impossible because the price there increased from 185 to 195 USD / t, FCA – supplier station. Major deliveries of imports are from Georgia and Turkey. The number of importers did not increase, imports from Kazakhstan decreased.

The second popular place is ammonium sulfate. Urea just begins to be procured, like NPK. Sales activity is very high.

Ammonium sulfate went up to 8 200 UAH / ton, CPT. Price growth is seasonal. Prices for the other fertilisers in Ukraine remain relatively stable.

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. During 11 months of 2018, the total turnover of trades on Kyiv Mercantile Exchange exceeded UAH 2.6 billion.