Scramble for spot ammonia cargoes as multiple plant shutdowns loom

LONDON (ICIS)–Plant shutdowns and turnarounds in several regions have tightened the ammonia supply/demand balance to such an extent that traders and producers have been forced to reject repeated approaches from spot buyers in France and India.

Sentiment remains bullish as a result of the planned and unscheduled maintenance, although whether this translates into a higher Tampa CFR (cost and freight) price for September loadings will not be known for another few days.

In the Black Sea, Koch will load its new vessel, the Clipper Venus, with 40,000 tonnes in mid-September following deals with suppliers OPZ and Ameropa.

The latter also sold 23,400 spot tonnes to Turkey’s Bagfas, which arrived a few days ago. Further business for September is expected in the coming week.

Borealis has yet to secure a spot cargo for prompt arrival in Rouen, while elsewhere in northwest Europe BASF and EuroChem appear poised to share 23,400 tonnes of Caribbean or US spot ammonia from PCS for September discharge in Antwerp.

Algerian manufacturers Sorfert and Fertial restarted their plants following a recent power cut in Arzew which has delayed loadings.

Scheduled turnarounds at Turkey’s Gemlik and Ukrainian producers OPZ and Dnipro will further limit spot availability in September.

East of Suez, no fresh spot business has been seen, or is expected, for several weeks due to major producers (Saudi Basic Industries Corporation) SABIC and Muntajat appearing overcommitted.

A fresh shutdown of a Saudi ammonia plant has put further pressure on SABIC’s supply situation, although the producer did restart its final line at Jubail after a recent outage.

Qatar’s Muntajat loaded three vessels with a combined 63,000 tonnes of contract ammonia this week, although the supplier is struggling to source a cargo for discharge in Jordan next month and is in talks with Ameropa over a CFR deal for a Black Sea cargo.

Spot demand from buyers on both coasts of India remains very strong, but no fresh deals have been seen as suppliers are unable to source sufficient product.

Fertilisers and Chemicals Travancore (FACT) will close its tender for 2 x 7,500-tonne cargoes for September arrival on the west coast on 24 August, with few offers expected as a result of the supply squeeze.

In Asia Pacific, China Petrochemical Development Corp (CPDC) has emerged as the buyer of 5,000 tonnes of Arabian Gulf spot ammonia from Koch

Samsung Fine Chemicals (SFC) will receive 10,000 tonnes of Australian spot ammonia next month after agreeing a deal with Yara at $435/tonne CFR Ulsan – the same level at which Yara recently sold 15,500 tonnes to Namhae.

Yara was among the parties that expressed an interest in sending 6,000 tonnes to Gresik next month under PT Cheil Jedang Indonesia’s (CJ) latest tender, although the buyer awarded the deal to local manufacturer Petrokimia Gresik at $450/tonne CFR.

In the US, the ammonia market remained quiet as crops advanced into the final phase of growth. Expectations for a strong refill period are building, especially with nitrogen loss issues being seen in several regions.