DTN Fertilizer Outlook

Russia-Ukraine War Drives World Wholesale Fertilizer Prices Higher

Generally, ammonia and UAN prices have been less responsive to market changes in the U.S. in the first months of 2022, as illustrated by the graph above comparing Fertecon U.S. nitrogen benchmarks on the basis of barge prices at New Orleans. Volatility in urea has left the other two major nitrogen sources mostly untouched due to seasonally slow activity in January and February. (Chart courtesy of Fertecon, Agribusiness Intelligence, IHS Markit)

The following is a recap of fertilizer price trends and market developments for the month of February and the beginning of March 2022.



Despite the record-high Tampa settlement for February deliveries, U.S. ammonia values remained largely flat from price levels in December during the last legs of the fall/winter ammonia run.

A lack of domestic demand since the last large buying period, coupled with extreme volatility in urea markets and a lack of any pressure on U.S. ammonia, has left Corn Belt values in a range of $1,350-$1,375 per short ton (t) free-on-board, or without transportation costs (FOB). The higher Tampa settlements did likely, however, prop up higher domestic prices from December into the rest of first-quarter 2022 on the slow activity.

Oklahoma plants were reported still offering ammonia volumes from $1,225-$1,350/t in February and early March, flat from levels in January and late 2021. Texas ammonia plants, meanwhile, saw a $50/t price increase from early 2022 levels to $1,300/t, with the supported global and Tampa ammonia values as well as generally tighter supplies pushing transaction totals higher.

At the end of the month, Incitec Pivot announced its 832,000-ton-per-year Waggaman ammonia plant in Louisiana will be down for six to eight weeks following a hydrogen leak. The company confirmed on Feb. 25 following an investigation that a rupture had occurred in a section of pipe at the plant, resulting in the release of hydrogen.

Ammonia could potentially see increased usage in the spring depending on its affordability compared to urea and UAN when peak spring season arrives, but it is likely prices will firm shortly due to Russian ammonia not being exported to the world market for the foreseeable future.


The ammonia market ground to a halt to end February as stakeholders sat back to assess the fallout from the Russian invasion of Ukraine. Almost overnight, the market transitioned from bearish with a decrease anticipated at Tampa for March to bullish, with further increases in prices expected due to the knock-on effect it has had and will have on supply.

It emerged in the last days of February that Yara and Mosaic had failed to reach a settlement at Tampa for March and that Yara would not be supplying to Mosaic at Tampa for the month.

Mosaic did, however, seal a deal with Trammo for March at $1,135 per metric ton (mt) cost and freight (including transportation costs -- CFR) for March, mirroring the price agreed by Yara and Mosaic for February. Those familiar with the deal said the price agreed by Trammo and Mosaic was for a single 15,000 t delivery in March.

Ammonia prices in February were seen mostly unchanged, month-over-month. In the Baltic Sea, trading levels were seen at $1,115/mt FOB. Black Sea ammonia, meanwhile, ended the month at $1,115-$1,120/mt FOB, unchanged from January levels.

Since February, Fertecon editors have determined that Black Sea urea and ammonia could no longer be confidently assessed with Russia's exit from the ammonia export market, and both benchmarks received "no-market" assessments in early March.

Global ammonia is seen as incredibly firm without Russian product for sale and sustained high natural gas prices in Europe.



New Orleans urea barges were assessed at $525-$705/t FOB at the end of February after a generally firmer tone was supplanted by panic after news of the Russian incursion into Ukraine hit the U.S. market. Values had already gained sharply, up from January lows of $485/t FOB and regaining much of the ground lost in urea prices during the first month of 2022.

U.S. river terminals along open sections of the Mississippi River had moved urea offers to $605-$635/t FOB, up from $575-$630 in January, before some terminals pulled prices at the end of the month during the first days of the Ukrainian conflict.

Concerns over building import inventories and low winter buying interest had motivated sharp decreases in urea prices in the first month of 2022, but interruptions to nitrogen movement and production in eastern Europe brought prices higher in the days and weeks following the beginning of conflict in Ukraine.

Urea prices are seen as firmer in the short term on unprecedented interruptions in the global export market, with impacts likely to stretch into the medium term or longer.


Urea markets -- particularly those west of the Suez Canal -- received a boost following the invasion of Ukraine, largely fueled by surging gas costs and uncertainty around supply should further sanctions by the international community be imposed on the aggressor.

Prior to the Ukrainian developments, prices had consolidated in Brazil on a slow start to 2022 with urea values seen from $550-$580/t CFR compared to the wider range of $500-$590 in January. Egypt, meanwhile, saw prices increase on steady sales providing more opportunity for activity versus Brazil, with prices assessed from $600-$730/t FOB in an increase of $30/t on the high end from the month prior.

However, in February, it was still too early to tell whether the newfound firmness was here to stay and how rapidly and to what extent it would reach given the extensive ramifications of the Russia-Ukraine conflict on global commodities, crude oil and freight, as well as on European nitrates and other fertilizers.

With March announcements of sanctions formally enacted against major Russian nitrate companies as well as major shipping companies having taken earlier steps to curb business at Russian ports, global urea prices are seen as firm.


The UAN market in the U.S. remained quiet in February as the market awaited new price levels following January's news in the import injury cases against UAN solutions from Russia and Trinidad.

On Feb. 17, CF announced a UAN tender to close at 5:00 p.m. U.S. EST on Feb. 22. CF was accepting bids for UAN open to all sources, modes and shipping periods, including bids well into the future.

However, with the news of Russia's invasion of Ukraine having landed in the market the day of CF's planned announcement of the results, the company delayed its tender. CF would eventually announce on March 3 that over 200,000 t UAN were booked with 72% of the volume booked for prompt shipping. The company said a majority was booked from its Donaldsonville plant, and no accepted bids or sales prices were disclosed.

NOLA UAN for the month was assessed $5 higher from January on no new sales reported at $545-$550/t FOB. Earlier offers for March barges were reported at $560/t FOB and April volumes at $575.

UAN sellers at U.S. river terminals had pulled their pricing ahead of the results from CF's tender, with price levels before they were pulled unchanged from the previous month at $590-$610/t FOB depending on shipping for first quarter or second quarter.

No new sales were reported as well on the U.S. East Coast with new Russian sales largely absent following the release of higher rates in the preliminary import injury investigations. East Coast prices had been previously assessed at the $660/mt CFR mark.

The market as a whole had been put on hold to see what the new developments would mean for fertilizer, including possible fertilizer-related sanctions on Russia. In the short term, U.S. nitrogen was largely quiet, but price increases were all but expected and would arrive in March.



February was a month marked by firming prices for DAP and MAP as trading interest on the former lifted ammonium phosphates values across the board before concerns over inventories elevated prices even further.

NOLA DAP and MAP both were assessed from $770-$775 at the end of February, up almost $100 from January, which saw prices close at $665-$675 DAP and $695-$699 MAP. DAP trading interest seemed to explode amid tightening supplies in the U.S. as the spring approaches, which dragged MAP values higher alongside it despite the latter having a sense of much better available supplies.

River terminal volumes also increased with barges at the U.S. Gulf, although to a lesser degree as January saw a good amount of DAP barge trading but little inland sales activity on any phosphates. Prices were seen $795-$805/t FOB DAP on open sections of the Mississippi River and $805-$815 MAP -- higher from $755 DAP and $775 MAP in the month prior.

Many terminals pulled their offers at the end of the month, however, due to the news from Ukraine and anticipated sanctions against Russian exports to drive prices much higher. As this did come to pass, and with no apparent relief in sight for the bullish run, we see phosphates as firm in the short term.


Demand for phosphates has picked up dramatically in South America with Brazilian importers scrambling to book product, prompted by surging soybean prices and with amounts increasingly starting to move to field as blenders look to cover their sales.

MAP prices increased accordingly to $900-$905/t CFR NOLA from $850-$860 in January.

East of the Suez Canal, DAP importers appeared to pause for breath in India with prices falling $5 from January levels to $920-$927/t CFR, but there remained latent demand.

The conflict in Ukraine is adding to consternation in the market created by the aggravation of the military conflict between Russia and Ukraine. Russia's importance as an international supplier has strengthened since September 2021, when China (the world's largest producer and exporter) imposed significant restrictions on its phosphate fertilizer exports set to last until at least the end of June 2022, if not longer.

As a result of all the above-mentioned factors, global phosphate prices are seen firm in the short term.


February continued the trend from January as potash interest from buyers remained fairly low on the demand side, typical of the lull between winter-fill buying and spring applications.

What did capture the attention of many was the development of European sanctions against Belarus, which began at the beginning of February with BPC being cut off from its primary port in Klaipeda, Lithuania, effectively halting all product from the country making its way to the rest of the world.

At first, it was thought Belarus potash might find its way through Ukrainian or Russian ports, but these ideas were quickly precluded by escalating sanctions against Belarus as well as the military action in Ukraine by Russia.

NOLA barge prices were seen lower from January prices from $660-$670/t FOB down to a range of $648-$655. Potash interest saw a slow start to 2022 and continued to depreciate in the U.S. until early March, rallying alongside other fertilizers in wake of the above-mentioned developments.

River terminal offers trailed behind adjustments at NOLA, and in mid-February, prices ranged from $690-$710/t FOB, or $5-$10 lower from January. Demand in the U.S. interior over the month was lackluster with buyers seeing no pressure to buy now, although distributors are expecting product to start moving through the supply chains soon with spring planting anticipated in the coming weeks.

Global supply contracts in China and India were also finally settled in February, paving the way for contract deliveries to begin in a time of great uncertainty in the market. Russia and Belarus represent nearly 40% of global production, and the threat of a rail worker strike in Canada has only added more fuel to the fire.

In the short term, potash prices are seen firm.


Editor's Note: This information was supplied courtesy of Fertecon, Agribusiness Intelligence, IHS Markit.