Analytical Reports

Fertilizer report

Major market developments
Fertilizer prices were mostly up in September along with prices for main fertilizer inputs. Price movements for several fertilizer categories were influenced by strength in the Indian market and uncertainty around exports from China. Market developments in the near term will be impacted by these two major actors as well as by demand for the fall application season in the Northern Hemisphere.

Fertilizer input prices increased in September.
In the case of natural gas, the previous concerns on liquified natural gas (LNG) exports out of Australia have dissipated but extensions of the maintenance schedule for plants in Norway supported European gas futures. Markets should be focused on monitoring stock levels in Europe, currently near capacity. Following an upward trend that started in August, ammonia prices surged in September, supported by major plant outages, while buyers showed unusually strong interest during this normally rather quiet time of the year.

Nitrogen fertilizer prices increased in September. Urea price increases were driven by uncertainty around the Chinese export levels, as authorities limited the distribution of export licenses to control domestic pricing. In this context, the unexpected purchase tender of Indian Potash Ltd. (IPL) on 15 September also provided support. Developments in China and India will continue shaping market sentiment in other nitrogen markets around the globe.

Phosphorus fertilizer prices increased in several major markets with particular strength in the Indian market and uncertainty around export restrictions from China linked to the customs inspection process. On the other hand, the earthquake in Morocco did not trigger major supply issues as initially anticipated. Current discussions on the nutrient-based subsidy rates in India are a major factor to watch, while demand is slow in Brazil and uncertain in the United States in view of the phosphate to grain price ratio that will determine application rates in the fall.

Potash prices in major importer Brazil were down slightly in September due to abundant availabilities. Global values show signs of stability.