Job loss rumours haunt fertiliser business

By Roger Chesher

SPECULATION increases concerning the rationalisation of the fertiliser industry in general and Hydros Immingham site in particular, with the local Grimsby press forecasting major job losses.

The reality, says the company, is that no decisions are yet made and no announcements due until April.

Meanwhile, the market is suddenly learning that price rises are reality.

After months of being able to sell nitrogen in the low 80s, merchants are finding that domestic nitrogen prices are steadily rising.

Last week 93/t, now 96/t.

Importers and blenders are finding sourcing difficult.

Granular urea is unavailable and the price of Lithuanian and former Soviet-Union ammonium nitrate has increased by 50% since October (from 40 to 60 US$ ex-works).

Transport costs are rising, especially shipment of imports from the Black Sea and Baltic. The problem of finding economical, properly qualified, hauliers in the UK is definitely a reality.

All of this has given the major producers the confidence to be much firmer on pricing, but still the price of AN on farm remains below 100/t, which, as seasoned traders point out, is where market forces tell us it should be.

As stocks of old-priced material run out, new supplies, whether domestic or imported, are higher priced.

This has an impact on both complex and blended compounds and liquids as well as straight nitrogen.

Only TSP and Muriate are static at present.

Under these conditions, when the farmer market really gets going, there is only one way for prices to go – upwards.

The moral has to be, get your nitrogen now if you can.

CURRENT MARKETS