18 July 2008 13:49 [Source: ICIS news]
LONDON (ICIS news)--Yuzhny ammonia prices have rocketed around $100/tonne (€63/tonne) this week as supplies at the port have dried up and vessels have struggled to load, market sources said on Friday.
A trader is reported to have paid $650/tonne FOB (free on board) for 4,000 tonnes of top-off tonnes at the beginning of the week, significantly up from prices assessed last week at $540-550/tonne FOB, by global chemical market intelligence service ICIS pricing.
Producers had been expecting to see prices hit $600/tonne FOB and above soon on the back of the tight supply situation.
Supply in Yuzhny remains very tight, with the storage tanks practically dry.
Traders reported that on 17 July there was only 25,000 tonnes in the tanks, of which 12,000 tonnes was reserve tonnage which cannot be used. The tanks usually hold around 80,000 tonnes.
Only around 5,000-6,000 tonnes are currently being delivered to Yuzhny daily, causing vessels to be delayed in loading and leaving traders scrambling to find enough tonnes to load their vessels.
The lack of tonnage is attributed to a raft of plant turnarounds in
Sources said they expected to see even higher prices if any spare Yuzhny ammonia emerged.
While some improvement in supply is expected next month, with one large producer due back on stream at the end of July/early August, there is expected to be a backlog of vessels to load which have slipped over from July, keeping the market tight.
($1 = €0.63)
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