26 April 2013 09:13 [Source: ICIS news]
LONDON (ICIS)--The benchmark Tampa ammonia contract price has fallen for the sixth month in a row after it was settled at $587/tonne (€452/tonne) CFR (cost and freight) for May loadings, market sources said late on Thursday.
The settlement between fertilizer giant Yara and its customers was agreed at a $10/tonne discount to April's price level of $597/tonne CFR.
The latest drop was in line with market expectations and came in the same week Yara was involved in fresh business in the Black Sea. The Oslo-headquartered company purchased 55,000 tonnes of ammonia from major producer NF Trading at $511/tonne FOB (free on board) for loading in the Ukrainian port of Yuzhny next month.
Last week, NF Trading sold 50,000 tonnes of Black Sea ammonia to trader Transammonia (Trammo) at $510/tonne FOB, and 10,000 tonnes to iTrade at "around" the same price. Yuzhny prices have fallen sharply since late 2012 when they peaked at $650/tonne FOB for December loadings.
The Tampa price has maintained a similar downward trend since its 2012 peak of $720/tonne CFR for November loadings, falling to $685/tonne CFR for December shipments and to $673/tonne CFR for January cargoes. The price slumped to $655/tonne CFR for February loadings and to $625/tonne CFR for March loadings, before sliding just below the $600/tonne CFR threshold last month.
East of Suez, the view that the market is balanced-to-tight has been disputed by buyers, who insist that their ammonia requirements have been sharply reduced because of production cutbacks at downstream caprolactam, acrylonitrile and nitric acid plants in Asia Pacific.
However, producers report sold-out positions, with little spot availability until June, particularly in view of plant turnarounds in Saudi Arabia.
Ammonia prices in the Arabian Gulf are currently in the $535-550/tonne FOB range, well down on the $705/tonne FOB level seen in late 2012.?xml:namespace>
($1 = €0.77)
|ICIS news FREE TRIAL|
|Get access to breaking chemical news as it happens.|
|ICIS Global Petrochemical Index (IPEX)|
Asian Chemical Connections