Bangladesh DAP import tender leads bullishness in phosphates market

Author: Sylvia Traganida

2021/06/04

LONDON (ICIS)--The phosphates market has been dominated by news of the opening of the long-awaited Bangladesh diammonium phosphate (DAP) tender.

  • Tight availability pushes Chinese offers up
  • Indian buyers on the sidelines due to higher prices
  • Brazil MAP prices up on high offers and demand

Around 2m tonnes of DAP were offered mainly from China and prices were in line with current global prices. The award of this tender is expected to take some tonnage out of the market, especially at a time when buyers are reluctant to make purchases due to high freight rates.

In China, DAP export prices have increased due to tight availability and global demand. Most producers suspended offers as they had no cargoes.

Production rates at domestic plants are stable this week, at around 65% for DAP and monoammonium phosphate (MAP).

However, Chinese DAP offers are not workable in India at the moment unless the domestic maximum retail price (MRP) increases as well. DAP import demand for the summer is expected to be strong, as rainfall during the southwest monsoon season is likely to be normal.

In the Americas, the Tampa DAP price remains unchanged due to a lack of export business from Mosaic. In the domestic market, the producer has increased its DAP/MAP barge prices for summer shipment on rising demand.

A US-based trader said that “some [are] still looking for fill supplies and availability is very limited.”

Another US source said that “more demand is coming for DAP/MAP but the corn price rally is pushing more traders into buying phosphates again.”

In Brazil, the MAP market is gaining momentum for the soybean season. MAP offers from Morocco, China and Russia have increased and business is being agreed at higher levels.

On the supply side, most producers are discussing July shipments. Saudi producers SABIC and Ma’aden will ship cargoes to India, the US, Brazil and South Africa, while DAP and TSP producers will focus on the Bangladesh tender.

Focus article by Sylvia Traganida

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Interactive by Annalise Porter