Sorfert Algeria ammonia tender awarded to Orascom Fertilizer Trading

13 March 2014 16:05 Source:ICIS News

LONDON (ICIS)--Algeria-based fertilizer producer Sorfert has awarded a major sales tender for 100,000 tonnes of ammonia to Orascom Fertilizer Trading (OFT) – the Dubai-based trading arm of the state-of-the-art plant's joint owner OCI Nitrogen, market sources revealed on Thursday.

All the cargoes will load at the port of Arzew, close to where the new $2bn ammonia and urea production facility is sited, between mid-April and late June after OFT saw off competition from two other bidders.

Moroccan phosphate giant Office Cherifien des Phosphate (OCP) is understood to have put forward a formula based on the average Yuzhny price + $18/tonne, with Norwegian fertilizer major Yara International heard to have offered a very similar pricing structure.

"The award has been made to the most competitive/highest bidder which is OCI OFT," the market source confirmed, without providing further details of the winning formula.

The current ICIS price range for Black Sea ammonia is $450-460/tonne FOB (free on board) Yuzhny.

Last month, Algerian ammonia producer Fertial awarded a sales tender for 300,000 tonnes of ammonia for late March to late September loading in Arzew and Annaba to Yara and Spain's Fertiberia.

No prices were heard for that tender but both buyers will take 150,000 tonnes. Fertiberia is a co-owner of Fertial.

In recent months, Algeria's export-oriented fertilizer industry has been impacted by a complicated export permit process that requires approval from the Ministry of Energy and the Ministry of Defence in the capital, Algiers.

The applications must include specific details of the buyer, vessel, destination, end-user and purpose.

On 12 March, OFT was also awarded an 11,000-tonne ammonia sales tender by Egyptian fertilizer producer Abu Qir priced at $454/tonne FOB.

That cargo will load in late March or early April and will most likely head to Spain or Israel on one of the buyer's time-chartered LPG tankers: the Prins Maurits and the Navigator Galaxy.

By Richard Ewing