Prices stay frm as market waits for India

Release time：2018-01-15

A resurgence in global urea demand is yet to emerge following the Christmas and New Year break, but despite relatively limited spot activity, producers are maintaining offers at frm levels for February shipment. Rumours are circulating that a new Indian tender will be announced shortly, which boosted sentiment towards the end of the week. The main talking point in the market continues to revolve around the urea shortage in China and how much needs to be covered before domestic demand eases at the end of the frst quarter. The gap between Chinese prices and the rest of the world continued to widen over the week, with Chinese prilled urea priced in a range of $310-320/t fob, a $10/t increase on last week. Indonesian prilled urea sold mid-week at $290/t fob, up $20/t on the previous sale from the region, amid a regional supply shortage. The latest Indonesian sales reinforce the perception that Chinese export supplies will not improve during February. In Egypt, Abu Qir sold granular urea at $266-267/t fob and a prilled cargo at $242-245/t fob, in line with latest sales from the region. Producers in Egypt and Algeria continue to target$270/t fob and above for February, but buyers in Europe and Turkey are in no rush to start discussions at these levels. In the Middle East, a prilled cargo sold at $260/t fob today for shipment to southeast Asia, alongside a 5,000t shipment of granular urea at $254/t fob. On the buy side, it is difcult to see where fresh demand will come from in the near term. Turkey appears to have bought the majority of its January and early February requirement, while over 80pc of frst-quarter European demand is understood to have been covered. Brazil reported record-high annual export fgures of 5.3mn tonnes for 2017, a 37pc year-on-year rise, including 710,000t shipped in December, leaving buyers in no rush to step in the market for January and February. The week ended with strong rumours that an Indian tender is to be announced in the days ahead. Indian stocks have fallen to 630,000t at the beginning of January, and any announcement for February cargoes is likely to push Mideast and Asian prices higher in the weeks ahead