For the Quarter Ending June 2021
Prices of Ammonia remained bullish in North America throughout the quarter, supported by recovering demand from domestic fertilizers sector. Post the recovery from the repercussions of the winter storm in the month of February, traders began to offer Ammonia at a higher cost around USD 330/MT in March. Fertilisers demand in USA also remained muted during Q1 2021, due to the seasonal calamities. However, demand gradually improved moving to Q2 2021 with improvement in environmental conditions. Besides, transportation hurdles also exacerbated the prices of Ammonia in USA, and eventually prices rose effectively and reached USD 450/MT in June.
Overall market sentiments of Ammonia in the Asia remained uplifted throughout the quarter, as the demand fundamentals from downstream fertilizers and pharmaceuticals remained strong. In the Chinese market, Ammonia reached 3 years high value, due to firm demand and tight supply activities across the country. Manufacturers revealed that this price rise was sudden as the prices rose without any seasonal demand, therefore they urged government to intervene into off seasonal price hike, where the price reached USD 648/MT during the month of June. Meanwhile, in the Indian market, domestic fertiliser segment experienced firm demand for Ammonia in the initial days of the quarter, which later reduced in May under pandemic mayhem in the country. In June, buyers stressed over subdued availability of Ammonia than the actual domestic and international demand, as under the pandemic condition in the country production level remained low for a month. Therefore, prices of Ammonia rose effectively and settled at USD 361.8/MT during June in India.
European market experienced sturdy market sentiment for Ammonia this quarter, as the demand from nitrogen-based fertilisers sector remained high enough to support the overall price trend of Ammonia. Production by Russian manufacturers remained sky-high throughout the quarter, backed by high regional and domestic demand from fertilizer sector. In addition, blockage of Suez Canal also impacted the regional prices of Ammonia and its downstream derivatives during early April, as the supply between Asia and Europe was disrupted for a week.
For the Quarter Ending March 2021
Ammonia production in North America remained disrupted throughout the quarter due to severe climate calamity. Supply for Ammonia across the region remained tight while the demand remained firm from downstream agrochemicals industries. During this period, some major Ammonia plants like Nutrien No 4 plant with an annual capacity of 760,000 MT, Tringen 2 with capacity of 500,000 MTand Yara BASF plant with a capacity 750,000 MT at freeport Texas remained idled. The shortage of Ammonia across the region made the prices to rise, FOB prices of Ammonia at Texas improved from USD 195 per MT (January 2021) to USD 205 per MT (March 2021).
Demand for Ammonia in the domestic Asian market remained stable to firm throughout the quarter. Though the supply remained tight, as trading activities witnessed difficulties due to congestion on prime trading routes amidst the increased freight & shipping cost. Meanwhile Lunar year in China, reduced the inventories level of Chinese manufacturers that created an additional burden on prices. The aqueous Ammonia prices in Indian market rose by 7.07% within the quarter and settled at USD 313.28 per MT in March.
Europe had a robust demand for Ammonia from domestic agrochemicals manufacturers, while witnessing unstable supply. High demand amidst tight supply forced traders to opt for premium prices of Ammonia. Later during March Suez Canal crisis also impacted the trading activities across Asia and Europe, which also affected the prices of Ammonia in the European region. Traders anticipated that the supply activity would normalize soon after the major plants of the region resume their activity.
For the Quarter Ending September 2020
Supply of Ammonia in the Asia Pacific eased in the July-Sep quarter after several Southeast Asian producers resumed normal operations with ease in COVID-led lockdown restrictions. Prices started regaining the lost momentum as improvement in demand fundamentals entering the second half of the year helped in partially offsetting the QoQ decline. Disruptions to the logistics chain and labor shortages which continued to harbor the Indian DAP and NPK fertilizer production in the first half of the year, meant lowered Ammonia feedstock requirements. Spot Ammonia was traded around USD 280.50 per tonne on CFR India basis. Ammonia demand from the northeast Asian chemicals producers showed mixed results, with some spot deals heard into China, Taiwan and South Korea regarding Q3 deliveries.
The European Ammonia industry was seen grappling with limited sales as industrial and agricultural operations were largely muted due to surging coronavirus infections. Exports were dented due to scheduled turnarounds and unplanned outages which led to fall in Ammonia exports from the Black Sea and Baltic. During the quarter, some Russian Ammonia vessels were booked for South Korea, as a more favorable option than shipping a cheaper cargo from Trinidad. Russia’s total Ammonia production registered record high on YoY basis in July and was priced around USD 180-190 per tonne on FOB basis.
The third quarter remained quite challenging for the US Ammonia producers who reported stable sales throughout Q3 as hurricanes and tropical storms forced turnarounds at several chemicals and fertilizers plants. A 500,000 tpy export-oriented Trinidad Nitrogen Company Limited (Tringen) plant at Point Lisas was turned offline in late September among three other Trinidad producers who temporarily shut production. Nutrien was the first one to idle some of its production looking at the sudden crash in regional prices. While prices across Southeast Asia, Middle East and Russia showed marked improvement during the quarter, Ammonia stocks across Americas remained heavily discounted. Spot Ammonia prices were assessed in the range of USD 170-180 per tonne FOB US Gulf.