04 July 2008 17:12 [Source: ICIS news]
By Carl Roache
LONDON (ICIS news)--Global urea prices reached record highs as traders jumped in ahead of expected buying in major markets and a predicted shortfall in supply for the US, they said on Friday.
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The rise of around $40/tonne in a week was prompted by traders jumping in anticipating large-scale buying in Latin America and
Indian Potash Limited (IPL) bought 50,000 tonnes of Romanian urea at a reported price of $725/tonne CFR (cost and freight) this week, and substantial further purchases were expected.
“Indian buying is getting closer so people want to go long and be prepared,” explained a trader.
The surge in
The Brazilian market was active as traders raised offer prices to $730-735/tonne CFR following the rise in FOB levels.
Elsewhere in Latin America and Central America, buyers flooded into the market to try to find urea and importers began checking prices and availability.
With Chinese exports all but excluded, traders predicted a shortfall of supply for the
This prompted many to snap up available granular urea in anticipation of this, causing prices to rise.
One of the most dramatic rises was witnessed in
Producer Egyptian Fertilizer Co (EFC) on Thursday sold close to 80,000 tonnes of urea at a record high $790-795/tonne FOB for July-first week of August shipment to the US, or possibly Latin America.
Last week, Egyptian producer Helwan Fertilizers sold 15,000 tonnes of urea at $730/tonne EXW (ex works) to traders Hagrpota for the
With limited July tonnes available, granular urea barges traded at $735-745/short ton FOB Nola (
Trading company Keytrade began offering granular urea at $740/short ton FOB Nola for August arrival from
Traders also bid Middle Eastern producers at $760-765/tonne FOB for granular urea for shipment to the
This level was around $50/tonne higher than the last business done.
It was unclear whether global urea prices would continue to climb after these recent dramatic jumps, although buying interest from several major markets remained strong.
“Maybe we are seeing the peak or maybe it will go up. It is hard to say at the moment,” said a trader.
($1 = €0.64)
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