Urea price hike fears ease with Â¤40/t drop
Despite a price of more than €460/t for urea and fears that the trade was set to rise by another €100/t over the coming months, industry sources suggest that the bullish tone in the international trade is beginning to evaporate.
Farmers interested in locking in their fertiliser costs before spring were given a nasty surprise when prices quoted were over €100/t up on the same period last year. However, there are now indications that a combination of demand burn-off and economic uncertainty have fed into a €30-40/t fall in wholesale urea prices in the last week.
Wholesale urea prices are now at €298.50/t, which is significantly lower than the past few months when prices were predicted to hit €447/t.
CAN prices are remaining steadier, although farmers will be hoping that it will follow urea prices over the coming weeks. The official German wholesale quote is currently at €285/t, which is actually higher than two weeks ago when CAN was priced at €295/t ex-port on the east coast.
Irish merchants and traders have been particularly cautious on pricing with recent quotes for CAN rarely lower than €320/t. Many are determined to avoid a scenario similar to 2008 when prices plummeted and many traders were left carrying over-priced stocks.
Despite buoyant prices for commodities worldwide, big buyers such as Pakistan and India, who were expected to come to the market in recent months, have not bought yet.
Compounds prices will not be set until later in the new year but the prices of potash and DAP are also likely to follow urea downwards.
IFA inputs chairman Chris Hayes said that current fertiliser price quotes were too strong and that the market has the potential to slip further downwards.