Phosphates market in anticipation ahead of IFA conference next week

Focus article by Sylvia Traganida

LONDON (ICIS)–The phosphates market is stable to firm this week, with limited activity ahead of the International Fertilizer Industry Association (IFA) conference in Istanbul from 25 to 27 May, according to sources on Friday.

In China, most producers are sold out for June and are retaining their price ideas above $465/tonne FOB (free on board).

Indian buyers, on the other hand, seem in no hurry to make purchases, as they are covered with earlier cargoes and they are waiting for the monsoon season to start in a month.

West of Suez, the Tampa diammonium phosphate (DAP) benchmark has edged upwards following a sale from Mosaic to Latin America.

The price has been slowly rising over the past few weeks and it is expected to continue to firm, as demand increases in Latin America and the Indian subcontinent. The domestic DAP barge price has been firming despite limited activity, which is expected to pick up as demand for fill barges is due to increase.

A US-based trader said that “while the [domestic] market is not ‘shooting up’ it is showing some solid footing going forward”.

She added that a number of people are starting to talk about refill needs and how it may not matter if they take it now and store it or wait until later in summer.

In Brazil, monoammonium phosphate (MAP) offers are heard above the $500/tonne CFR (cost and freight) barrier and activity is expected to pick up in the coming weeks.

This rush in buying, in turn, is expected to cause logistical issues for June/July arrivals, as most producers are already sold out for June and the 30-day delay seen in Paranagua is expected to increase. 

On the supply front, most Chinese producers are sold out for June. Tunisian state-owned producer Groupe Chimique Tunisien (GCT) production is still down and the producer might have only one DAP cargo left for shipment.

It still remains unknown when full production will resume. In Jordan, Jordan Phosphates Mines Company (JPMC) has cut down production to 70-80% due to modifications at its granulation plant, especially at a time when buyers might be looking for product following the GCT issues.