Confusion reigns in fert market
CONFUSION REIGNS in the fertiliser market this week (w/e July 23), with the major suppliers adamant that the order books are closed through to September/October.
But other players are equally confident that ammonium nitrate can still be found at ultra low prices around ÂŁ117/t delivered to farm.
To put this into a global perspective, South America is buying most available cargoes on the world market at prices considerably in excess of those in the UK.
Granular urea is currently $230/t (ÂŁ125/t) free-on-board out of Kuwait.
With transport, finance costs, duty, packaging and a margin this would work out at ÂŁ174/t bagged on farm in the UK.
Taking the difference of analysis into account, this equates to ammonium nitrate at ÂŁ130/t.
It is therefore easy to see why imports have yet to penetrate the home market and why UK prices have been considered unsustainable.
But supplies of imports are essential to fulfil demand in the UK market, even if domestic production runs unabated.
All of which serves to illustrate the current strong upward pressure on prices which must come into play in August.