DTN Fertilizer Outlook: U.S. Prices Likely Firmer in Short Term

Anydrous Fertilizer tank with grain bins in the background. ©Debra L Ferguson

The following is a breakdown of wholesale prices and trends of the various fertilizers in December 2020 and first two weeks of January 2021.



CF announced its spring prepay offers on anhydrous ammonia to start December, which began a month of strong fundamentals on ammonia prices to come with another rise in the Tampa ammonia contract to $270 per metric ton (mt) cost-and-freight (CFR). Ammonia direct application wound down later in December after enjoying a long stretch of fair weather through late fall/winter and wholesalers reported strong demand earlier in the season.

CF announced its spring prepay offers on anhydrous ammonia in the first week of December. Initial offers were reported at: $410-$415 per short ton (t) central Corn Belt (basis Illinois and Missouri), $410-$415 in the Eastern Corn Belt, $410 Minnesota, North Dakota $430-$440 and $415 Iowa.

Koch issued spring prepay ammonia offers in line with CF in the Northern Plains and in the Eastern Corn Belt over the following week, at around $410-$415/t FOB (free on board — the buyer pays for transportation of the goods) in Minnesota.

Initial prepay offers at the factory level came in at $390/t at Port Neal in Iowa, and $300 eastern Oklahoma for March pull at CF’s Verdigris plant.

Higher year-over-year prepay offers from CF and Koch were considered in line with recent ammonia price hikes in international markets and the Tampa contract price, which point to more controlled supply in global ammonia. In comparison, prepay offers in 2020 were $15-$20 higher than in 2019.

As a result, however, some Corn Belt retailers said offers were somewhat less attractive to buyers. Following initial offers, fill values settled $20-$30/t below prepay, for instance in the Twin Cities at $380-$390/t FOB.

In the short term, when activity is expected to come off ammonia somewhat following the winter prepay period and buyers look to other sources of nitrogen, we expect ammonia prices to continue to firm stronger before stabilizing in the coming weeks.


Yara and Mosaic agreed a price for January of $270/mt CFR Tampa — up $15 on the $255 CFR agreed for December and in line with expectations of a higher settlement. Bullish price trends in ammonia are favored heading into the first quarter based on the increase in the Tampa contract, reflecting higher input costs for Trinidad production and recovering industrial demand.

Reports of natural gas curtailments seen in December could continue into January, continuing to drive higher ammonia prices in the region and for the Tampa price. However, the restart of an Algerian ammonia plant and subsequent sale to Morocco may free up Trinidad ammonia for the U.S., potentially tempering any further price increases.

The Baltic ammonia contract price settled in December at $212-$214/mt CFR, a tighter and mostly lower range from November’s range of $204-$230, while spot prices in the Black Sea rose $15 to $225-$230/mt FOB, demonstrating a firmer overall global ammonia market to close 2020.

Entering 2021, the outlook for global ammonia is firmer in the west while somewhat flat in the east.



New Orleans, Louisiana, (NOLA) urea was assessed at $242-$250/t FOB to end December, flat from the month prior as values settled lower following the conclusion of India’s December tender. Despite a lull in in-season demand, speculation on spring values lent some support to the prompt barge market.

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Some prepay buying was seen at the end of the year, but activity around the holidays was slow, as expected, until values began to skyrocket in early January.

At year’s end, river terminal values were $275-$290/t FOB, up about $15/t from November as domestic supplies settled a little lower than in 2019 due to a slow start on import volumes. Closures of the upper sections of the river also helped to buoy values at interior plants and in northern markets.

At the end of December, Port Neal urea was reported flat from November at $280/t as well as in eastern Oklahoma at Enid.

Working against further urea price hikes is UAN, which remains attractive and cheap in comparison at levels only $15/t above summer fill. With much of the market’s focus now shifting to nitrogen needs for the spring, we expect urea prices to remain stable to firm in the short term, with India’s next tender expected to lift prices even higher if issued as expected earlier for January or February.


The biggest development in global urea in December was the completion of India’s last tender of 2020, and the market thereafter resting comfortably with most of the urea supply bought up at the end of the year — which would go on to cause prices to rise quickly in early January as tons that were still available fetched higher prices.

With India having purchased 1.27 million metric tons of urea in the first week of December, the question on the minds of everyone is when India will next return with a tender — the expectation being that it likely won’t return until January at the earliest while some bears suggested even February.

Egyptian urea prices rose $5-$10 in December to $281-$282/mt FOB on a well-filled export order book, which left the producer comfortable with current commitments to close the year. In Brazil, granular urea prices rose to $278-$288/mt CFR to end the year, up from $273-$277 in November as buyers stepped in for January shipments ahead of the holidays.

As major sellers turned to February sales, bowed out of the urea market on production issues, and another potentially planning to do maintenance later in January, lower availability in the Arab Gulf provided the foundation for the global urea rally seen in the first week of the new year.

Exiting December, the market appeared poised to stabilize. But after seeing early-year rallies, our outlook on global urea is firm in the short term.


December saw some of the first hikes in UAN prices since plateauing after summer fill with CF beginning sales for spring prepay and raising its nearby offers.

CF raised prices in its main terminals in St Louis, Cincinnati and Mt. Vernon to $160-$165/t FOB, reflecting a $15 increase over summer fill values. Spring offers were announced with a $6 carry on average per month, reported at $166/t for March and $173 for April and May.

At the factory level, Port Neal was priced at $165-$170/t on UAN 32% for prompt pull at the end of December and $145-150/t in eastern Oklahoma, with showing increases of $10 month over month.

On the East Coast, import prices were raised slightly to $145-155/mt CFR, $5 higher over November due to higher profits required for Russian dispatch, as their domestic producers enjoyed better demand in the homeland in December.

In the short term, UAN is poised to firm and is expected to continue attracting prepay business for spring, especially considering the recent urea bull run and its relative high affordability for nitrogen.



Despite a last-minute announcement by the U.S. government to lower one of its subsidy rates in the countervailing duty investigation against Moroccan and Russian phosphates, domestic buying activity and application slowed down before year’s end after a busy first half of December.

The rush of fall and winter activity on phosphates finished midway through the last month of 2020 as mild weather extended through December, allowing for direct application and fill buying for those who could find tons. NOLA DAP barges rose to $392-$395/t FOB in December, up from $360-$375/t FOB in the month prior.

MAP barges meanwhile hit $420-$440/t FOB, over $50 higher from November values as product remained even more scarce than DAP.

Prices on open sections of the Mississippi rose to $425-440/t FOB DAP and $460-$490 MAP, a $30/t increase, and a $50-$60 hike on MAP compared to November values, which reflected a higher proportion of DAP tons available over MAP. The most extreme tightness was seen in Tulsa and St. Louis where MAP held as high as a $50 premium over DAP in December.

In the short term, we expect U.S. phosphates to remain firm on continued tight availability through early 2021, with Russia and Morocco still expected to withhold sending any tons before the conclusion of the investigation, even considering the lower tariff rate on the latter.


World phosphate prices ended 2020 on a firm note on higher prices in the U.S., Morocco filling its export quotas to non-U.S. destinations in the wake of the ongoing countervailing duty investigation, and Middle East producers also in comfortable positions.

On Dec. 22, the U.S. Department of Commerce issued a revised tariff rate for Moroccan phosphates in effort to correct a “significant ministerial error” in its calculations. The DOC brought its countervailing subsidy rate for Morocco down from 23.46% to 16.88%, ahead of a final decision expected on Feb. 8. The rate for Russian-based product still ranges from nearly 21% to as high as 72.5% depending on the source and seller.

Indian DAP values ended December at $365/mt CFR, flat from November, as demand moves seasonally away from the Southern Hemisphere and tropical areas.

Despite the flat price in India, both India and Brazil continue to pull a good amount of product from exporters and are offsetting the market disruption caused by the halt of U.S. trade with Moroccan and Russian phosphates. In Brazil, for instance, MAP prices rose to $405-$410/mt CFR after ending November at $375.

Leaving December and 2020 behind, the outlook on global phosphates in the short term is for prices to stay firm, but with the potential for longer-term gains tempered by the banner year of 2020, which saw record demand across the globe and potentially higher stocks to start 2021.


NOLA potash barges were assessed higher at $250-$252/t FOB, up from $235-$236/t FOB in November as the market saw continued high demand for prompt tons for application and fill in mild December weather, which began to slow ahead of the year-end holidays.

Likewise, Mississippi River market prices were assessed unchanged at $270-$300/t FOB at open river terminals. North American mine prices were raised $40 in early December, but many terminals had yet to catch up at the end of December to the increases with replacement costs expected to catch up gradually after recovering from rampant winter demand.

Production curtailments that began in fourth-quarter 2019 in order to balance the market are not expected with this year after extremely favorable market conditions seen near the end of 2020. In 2019, a continued period of oversupply had led to high inventory levels across the globe, delays in the Chinese import supply contract settlement and the COVID-19 virus had a large impact on the first half of 2020 for potash sales.

In the short term, we expect U.S. potash prices to remain stable to firm as North American producers reset from the busy fall and decide how to maintain market momentum.


Editor’s Note: This information was supplied courtesy of Fertecon, Agribusiness Intelligence, IHS Markit.

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