Asia
Spot prices in the Asian ammonia market underwent a gradual decrease from November 2012 to February 2013, dipping from $770-790/tonne CFR (cost & freight) NE (northeast) Asia in mid-November to $650-670/tonne CFR NE Asia in mid-February.
Reduced ammonia consumption from downstream acrylonitrile (ACN) and caprolactam (capro) plants in Asia in the face of weak margins, dwindling ammonia demand from India, and improved production rates in the Middle East were factors contributing to the downward price trend.
A turnaround at the Ma’aden Phosphate Co (MPC) diammonium phosphate (DAP) plant in Saudi Arabia in early February and the ensuing extra availability of feedstock ammonia led to a drop in spot prices at the start of the month.
Falling ammonia prices in Tampa and Yuzhny were also seen as contributing factors to the price decline in Asia.
Ammonia prices are expected to remain under downward pressure until demand from the downstream industrial segments in Asia and also from fertilizer users in India improves and a more balanced supply/demand ratio is achieved.
Updated to mid-February 2013
Europe
Ammonia prices in the Black Sea maintained a downward trajectory during the first quarter of 2013, although a tightening global supply/demand balance caused by plant shutdowns and outages in the Arabian Gulf slowed the rate of fall at the start of the second quarter.
Benchmark prices fell from $570/tonne FOB (free on board) for February loadings to $511/tonne FOB for May cargoes sold by major producer NF Trading, which now handles an extra 50,000-60,000 tonnes of ammonia a month produced by Odessa Port Plant (OPZ).
The sliding price was the result of reduced demand from Indian producers of DAP (diammonium phosphate) and MAP (monoammonium phosphate), and lower output rates at several downstream acrylonitrile (ACN), caprolactam and nitric acid plants in Korea and Taiwan.
Some market participants have speculated that Black Sea prices could fall to $500/tonne FOB for June loadings, but recent planned and unplanned outages at ammonia plants in Saudi Arabia have impacted May and June availability in the Arabian Gulf, which could give support to Yuzhny prices heading into the second half of the year.
Updated to mid-May 2013