Urea US

US urea prices have begun to increase as the spring planting season draws closer in the three months to mid-February and as trader-to-trader activity has given way to some increases in dealer demand.

Demand for urea in the three-month period of November through January was slightly muted due to seasonal conditions and a lack of buying from distributors as many were watching to see if the pricing slide would continue.

As the market moved into February the demand has begun to rebound as it is expected US farmers will be planting a huge corn crop in 2013. The size of the crop is expected to be 97m-99m acres which would surpass the 96.4m acres of corn in 2012 and could top the highest number of corn acres planted since 97.2m acres were planted in 1937.

In early February granular urea in the US Gulf was priced in a range of $433-440/short ton FOB compared with $401-410/short ton FOB US Gulf in November.

Looking forward, sources indicated that urea prices in the US could likely increase from current levels as applications have started in some parts of Texas and soon will in other crop regions. Yet this remains dependent on the refill season continuing to completion and further increases in dealer demand versus the recent pattern of trader to trader activity dominating the market.

Updated to mid-February 2013