Calum Findlay, Gleadell’s fertiliser manager, comments on the fertiliser markets

Urea

After six consecutive weeks of moving from strength to strength, there are signs that the urea market could be running out of steam.

Prices have traded up to $393/t FOB Egypt this week (about £305/t delivered to farm) and it is thought that prices may have peaked. However, it remains uncertain whether we will see any major price correction in the short term.

There is still some significant demand from Europe, India and South America, which may keep this market buoyant over the coming weeks, but is the market sustainable?  With weakening global grain prices something will have to give to force fresh demand.

Ammonium nitrate

After increasing across Europe and the UK, ammonium nitrate prices have again only managed to trade sideways this week. Imported values remain static, trading at the usual discount to UK-manufactured product.

It is interesting to highlight the amount of demand still to surface in the UK to catch up with a ‘typical’ year. Many growers have not bought a tonne and, with a predicted figure of over 1mln t of product still to be delivered to farm and a shortening delivery window, more price increments are expected.

The fertiliser industry could potentially see a huge bottleneck in the run up to spring application. Consideration should be given to taking a percentage of spring fertiliser requirements to spread the risk. Gleadell can offer very competitive finance deals to suit all circumstances until 2015.

Phosphate and potash

Phosphates continue to firm both globally and in the UK. Although much of the autumn demand has now been covered, there are still some large shorts that need covering and this will keep the market firm for the short term.

With regard to potash, we have seen a very flat market for most of the year although things do look to be firming. UK blenders have continued their price increases this week on both spring and autumn grades.