Fertilizers

UREA

Urea prices have remained stable for the past few months. Compared to last year they are slightly lower in the Baltic region and higher in the Persian Gulf.

Urea and ammonia production in the United States has been adversely affected in the aftermath of hurricane Katrina because of interruptions in the supply of natural gas and further price increases. Gas prices were already high before the hurricane because 88 percent of the offshore production had shut down. The prices for both urea and ammonia in the United States have increased, while ammonia prices rose worldwide for the last few months.

In the Baltic and Black Sea region prices have started to decrease slightly and activity is slow.

In South Asia demand for urea is strong. Demand in India is higher than expected because of a good monsoon season. Bangladesh is tendering for a considerable amount, reportedly from Indonesian and Chinese origin. Pakistan is also actively looking for tenders.

Turkey has shut down its urea plant due to high gas prices and its urea imports could increase significantly.

DIAMMONIUM PHOSPHATE (DAP)

DAP prices have remained stable in the past few months, but compared to last year are higher by 10 to 15 percent.

Phosphate production in the United States was also hit hard by the impact of hurricane Katrina and lost production could amount to 380 000 tonnes from September through November.

In India local production is recovering but there is still a need for imports, mainly for the East coast. Australia and China are potential suppliers.

China has signed a memorandum of understanding with Morocco over a joint feasibility study on potential phosphoric acid and phosphate fertilizer production investments in Morocco.

Ethiopia is expected to enter the market for a total of 350 000 tonnes; most of this will probably be supplied by Jordan.

MURIATE OF POTASH (MOP)

Prices of MOP have also remained largely unchanged in the past few months, but are 30 to 40 percent higher than at the same time last year. There is a big gap between the lowest and the highest price quoted.

There is a possibility that the EU commission may allow a quota of MOP from the Russian Federation to be sold without antidumping duty in all of the 25 member countries.

Shipments to India continue to be substantial, with the main supplier being Israel. The total amount imported between April and July 2005 has increased by about 20 percent compared to last year to almost 1 million tonnes.

Chinese imports also increased by 20 percent in the period from January to June, compared to the previous year, to 4.5 million tonnes.

The Southeast Asian market is currently slow. The Brazilian market is weak as well because stocks are high both at the ports and inland.