India’s FACT receives two offers in ammonia tender

22 February 2012 16:02  [Source: ICIS news]

LONDON (ICIS)--Indian manufacturer Fertilisers and Chemicals Travancore (FACT) received two offers under its 22 February ammonia purchase tender, market sources said on Wednesday.

FACT closed a tender on Wednesday for 7,500 tonnes of ammonia for 1-5 March delivery to Cochin. The lowest offer was submitted by Kuwait’s Petrochemical Industries Company (PIC) at $396/tonne (€297/tonne) CFR (cost & freight), sources said.

Qatar Fertiliser Co (QAFCO) also made an offer, at $405/tonne CFR, they added.

The offers are requested to remain valid until 24 February.

Saudi Arabias SABIC and Transammonia are understood to have told FACT they regretted being unable to take part in the tender.

FACT last purchased ammonia in January from PIC at $460/tonne CFR.

Since then, ammonia prices have fallen as a result of high inventories in the Middle East and weak demand from Indian buyers because of the delayed settlement of Q1 phosphoric acid contracts.

At the start of February, United Arab Emirates-based trader Kisan sold a 15,000 tonne spot cargo of Saudi ammonia to Indian Farmers Fertiliser Cooperative (IFFCO) at $377.50/tonne CFR.

Subsequently, trader Raintrade, of Turkey, sold a 12,000 tonne cargo of Iranian ammonia to IFFCO at $287.50/tonne CFR.

But phosphoric acid contracts in India having settled is lending support to ammonia demand and prices. Offers under FACT’s tender have not slipped as low as latest spot business, but are more in line with recent contract prices around $400–410/tonne CFR.

($1 = €0.75)

By: Rebecca Clarke
+44 20 8652 3214

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