OCP agrees H2 Russia sulphur at $350/tonne rise

14 July 2008 15:22  [Source: ICIS news]

LONDON (ICIS news)--Moroccan phosphate fertilizer producer Office Cherifien des Phosphates (OCP) has agreed a second-half 2008 supply contract for Russian sulphur at an increase of around $350/tonne over January-June prices on supply and demand issues, market sources said on Monday.

 

OCP took 1.5m tonnes of Russian sulphur annually through trader Solvadis and the price for July-December 2008 was agreed at just below $800/tonne CFR (cost and freight), a company official confirmed.

 

Solvadis agreed a first-half price with OCP in the $440s/tonne CFR range.

 

However, OCP failed to find a price agreement with trader ICEC for Kazakh sulphur during the second half of the year.

 

Sulphur prices have soared this year on the back of tight supply globally and strong demand from the phosphate fertilizer industry.

 

Earlier, ICEC had agreed second-half prices with Tunisian buyer Groupe Chimique Tunisien (GCT) for Kazakh tonnage at $795-800/tonne CFR.  

 

ICEC had been looking for a price slightly above $800/tonne CFR with OCP to take account of the higher freight rates from the Black Sea to Morocco.

 

OCP also takes Middle East sulphur but remains in talks with suppliers regarding July-December 2008 contracts.

 

Middle East suppliers initially targeted prices in the high $900-1,000/tonne CFR range but these were rejected by the buyer, who is looking for a price similar to that agreed for Russian sulphur.

 

OCP was hopeful agreements could be found with Middle East suppliers in the next week, noting that they now appeared more willing to compromise on price.

 

Morocco imported 3.9m tonnes of sulphur in 2007, up from 3.7m tonnes in 2006.

 

($1 = €0.63)

 

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By: Rebecca Clarke
+44 20 8652 3214

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