Urea US

US urea prices have been under pressure in the three months leading into to early May as the US planting season has been forced to deal with weather delays driving end users’ overall demand down.

Another factor impacting urea is that the market has been overridden with bearish sentiment with price indications drifting down and thoughts lingering that the floor has yet to be reached.

In early May granular urea in the US Gulf was priced in a range of $323-340/FOB compared with $400-408/FOB in March and of $433-440/FOB on the last recap of February.

The lack of activity and uncertainty of pricing, and questions over whether it will go even lower, has both buyers and sellers remaining cautiously on the sidelines. At this time it is expected that the market will continue this way into next month as participants watch and see what direction urea ends up following.

Looking forward both producers and distributors are slightly optimistic that once farmers are able to plant their corn, cotton and other spring commodities that demand will start to tick upwards, especially as supplies dwindle and the onset of refilling begins in earnest.

A movement forward could end up being the trigger that pricing needs to start to rebound to levels previously seen at the end of 2012 and through the first months of this year.

Updated to mid-May 2013