Indian phosphate buyers pause on high Chinese offers, ample stocks

Author: Sylvia Traganida

2020/10/16

LONDON (ICIS)--The phosphates market did not see much activity globally this week as demand is muted.

  • Chinese producers offer DAP at higher levels
  • Indian DAP import demand to continue in November
  • Australia import demand expected for Q4

Chinese producers returned to the market following their Golden Week holiday and started offering diammonium phosphate (DAP) at higher levels. At the moment export offers are firm, but Indian buyers are reluctant to agree to business at these levels. There is some demand in Vietnam for small DAP lots, and Australian demand is increasing for Q4.

There is currently ample supply in India, leading to less pressure on the buy side. There is demand for some cargoes for November shipment, but buyers can afford to wait.

An Asia-based trader said “offers are aplenty! November shipment at $360-362 FOB and bids at $358 FOB but for prompt shipment. If you could do spot and flip it to India, good chance.”

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In Australia, phosphates stocks are low and winter crop demand is expected to be average or better.

Importers will need to build up shipments in Q4 and in general there could be six to eight cargoes from China before year end for East and West Australia.

In the Americas, the Tampa DAP price is unchanged due to a lack of export business from Mosaic. In the domestic market, DAP/monoammonium phosphate (MAP) barge prices are mostly stable following minimal business. Demand is slow at Nola, but business out of terminals is strong. There is a lack of rain in the Midwest, which could affect buying demand.

In Brazil, MAP demand is lacklustre as buyers are waiting to make purchases for the next season. Demand is expected to pick up towards the end of the year. Producers keep sending cargoes to Brazil, while PhosAgro and Ma’aden will ship volumes in November.

On the supply side, most producers are comfortable for November. PhosAgro will finish its scheduled maintenance soon and has already committed most of its October/November production.

Focus article by Sylvia Traganida

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