Morocco's OCP agrees Q1 phosphate rock price cut with Europe

14 February 2012 15:26  [Source: ICIS news]

LONDON (ICIS)--Moroccan fertilizer producer Office Cherifien des Phosphates (OCP) has agreed to cut first-quarter phosphate rock prices with European buyers, the company said on Tuesday.

Contract prices have been reduced by $10/tonne (€7.60/tonne) from fourth-quarter settlements, to $185–200/tonne FOB (free on board).

Declining prices for finished product diammonium phosphate (DAP) had led to expectations that contract prices for raw materials phosphate rock and phosphoric acid would be lowered.

OCP had already agreed to cut first-quarter phosphoric acid prices by $50/tonne from fourth-quarter settlements, to $950–1,085/tonne FOB, for European buyers.

Negotiations with European buyers have concluded before phosphoric acid and phosphate rock contract settlements have been agreed with Indian buyers.

Settlements would usually be agreed with Indian buyers first. However, talks between OCP and Tata Chemicals Limited, Zuari and Paradeep Phosphates Limited on agreeing first-quarter phosphoric acid prices have entered a seventh week.

The buy side is pushing for a $150/tonne drop, to $930/tonne CFR (cost and freight). OCP has declined to comment on price discussions but confirmed that negotiations are ongoing.

Talks on first-quarter phosphate rock contracts between suppliers, including OCP, and Indian buyers will only begin once phosphoric acid contracts are agreed.

Annual contract negotiations between US and Russian suppliers and India for DAP are imminent but they could be postponed if prices for the raw materials are not concluded soon.

($1 = €0.76)

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By: Karen Thomas
+44 208 652 3214

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