Nitrogen price leaps 100 barrier

By Roger Chesher

AS in politics, a week can be a long time in the fertiliser business and trading is now changing very rapidly.

Last week, Bob Chorlton, the UK head of Kemira, said that he confidently expected nitrogen to trade at 100/t by March.

In fact, the first orders at that price were taken on Wednesday.

This must bring some relief to the hard-pressed fertiliser companies. which will be posting their year-end results later this week.

UK losses in excess of 10 million each by the three majors must be expected, whereas with restructuring and a price above 100/t, they should be just in the black in year 2000.

Hydro and Terra have also posted a 100/t price for new Ammonium Nitrate business.

The compound price has not moved upwards quite so swiftly, but the shortage of CAN for blending keeps an upward pressure on price.

The majors may be relieved about price change, but they are certainly well aware of farm incomes and the farmers ability to pay for fertiliser.

We must remember that at 100/t the price is still significantly below “normal”, and way behind the consumer price index.

Movement is now very brisk, almost up to capacity. Haulage is still a problem, with at least 10 days lead-time.

Yet, some farmers still delay purchase and many will miss the boat, as in this much tighter market there is no guarantee that deliveries will be on demand.

The CAN situation is pushing compound prices higher in Ireland but prices there are still somewhat meaningless because of the “Trust” situation – buy now, sort out the price later.

Despite a hotbed of rumours in the east, no decision has yet been announced about the fate of Immingham.

Finally, with T°-Sum romping away, grassland fertilising has started – see the FWi/Kemira T°-Sum pages for details.

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