FERTILISER MARKET REPORT

6 July 2001




FERTILISER MARKET REPORT

July 2001 (£/t delivered)*

N UK SP5 N UK SP5 Imported urea Imported AN

New season (July) August Granular New season (yet to arrive)

£108-£110 £110-£112 £118-120 Approx £98

NPK complex NS top dressing

25.5.5** 20.10.10** 15.15.20 17.17.17 New season

£118-£120 £121 £143 £148 £108-£110

* All prices based on 20t loads for cash payment month following. Prices for smaller loads and 50kg bags will vary.

** For blended prices, deduct £5/t.

By Bridgewater

Partnership

The new season has started with market leaders Terra pitching nitrogen prices at a similar level to the start of the 2000/01 season -£108-110/t on farm (Business, June 29).

Merchants were told of these prices last week and will have now received their price lists to enable them to start trading.

Inevitably, the trade is testing the manufacturer to see what cracks exist in their resolve, but they are unlikely to be successful. The price is as stated, it goes up by £2/t next month, its cash only and Terra will export ammonia if necessary when stocks become high.

Good deals are currently to be had in imported granular urea, but this is unlikely to appeal in great volume to the seasoned early buyer.

Current interest rates should favour the early buyer who will probably consider the risk worth taking again this season, given anticipated spring demand. However, exchange rates will make imports that little bit more costly and their impact on the price of phosphate, all of which has to be imported, is significant.

How that will translate into the fiercely competitive autumn PK market has yet to be seen, but with anticipated higher demand one should expect prices to creep upwards.

Apart from nitrogen-sulphur compounds, which bizarrely are classified as straight nitrogen by law, compound prices have not changed. Kemira, leaders in this segment of the market, will probably once more set the pace for granular compounds, with Terra positioning their range as quality blends.

for kicking off the new season has gone, so the market looks to Terra, the leaders in nitrogen, to signal new prices, presumably in a week or two. A starting price, on farm around £109/t, is probable but the big question is whether this will tempt the early buyer.

There is little interest in new season imports as yet, as importers seek to clear old stocks, but with ammonium nitrate prices globally on the decline, new imports should be competitively priced.

The structure of the new market will ultimately depend upon demand, currently way down thanks to foot-and-mouth, a wet autumn and increased set aside. Stories of wall to wall wheat after this harvest could increase demand and firm the price.

It could well be, just, another season where the early buyer benefits.

Current interest rates should favour the early buyer, given anticipated spring demand. However, exchange rates will make imports that little bit more expensive and their impact on the price of phosphate, all of which has to be imported, is significant.

How that will translate into the fiercely competitive autumn PK market has yet to be seen. But, with anticipated higher demand, prices are expected to creep upwards.

Apart from nitrogen-sulphur compounds – which bizarrely are classified as straight nitrogen by law – compound prices have not changed from last year. Kemira, the leaders in this segment of the market, will probably once more set the pace for granular compounds, with Terra positioning their range as quality blends.


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