30 November 2011 15:43 [Source: ICIS news]
PhosChem – which has a three-year contract to export 2m tonne/yr of DAP to
IFFCO asked for a $50/tonne (€37.50/tonne) reduction for DAP and $45/tonne for nitrogen-phosphate-potassium (NPK) to ease rising retail prices for end users.
PhosAgro confirmed a discount on cargoes of DAP due to be shipped until March 2012 under a 1m tonne contract has been agreed.
IFFCO said the discount is $35/tonne, which would lower the established contract price of $677/tonne CFR (cost and freight) to $642/tonne CFR.
PhosAgro would not comment on the actual price reduction but the agreement commits IFFCO to buy additional cargoes of Russian DAP and grants the producer a seller’s option, allowing it to vary time of delivery and settlement on these shipments.
Exercising its seller’s option would take PhosAgro out of the market until April 2012.
The agreement has startled other major market players.
They have expressed concern that such actions could set a precedent and place extra downward pressure on the phosphates market, which is already at low ebb.
PhosChem said: “We are continuing to ship DAP to
Ma’aden is ramping up production rates to 70-80% in the first quarter of 2011 and output is expected to reach 3.2m tonne/yr at full capacity.
For more on DAP visit ICIS pricing fertilizers
For the latest chemical news, data and analysis that directly impacts your business sign up for a free trial to ICIS news - the breaking online news service for the global chemical industry.
Get the facts and analysis behind the headlines from our market leading weekly magazine: sign up to a free trial to ICIS Chemical Business.
|ICIS news FREE TRIAL|
|Get access to breaking chemical news as it happens.|
|ICIS Global Petrochemical Index (IPEX)|
|ICIS Global Petrochemical Index (IPEX). Download the free tabular data and a chart of the historical index|