For the Quarter Ending March 2024
North America
During the first quarter of 2024, the Di Ammonium Phosphate (DAP) market in North America experienced a bullish price trend. This was driven by a combination of factors including limited supply and rising prices of raw materials.
The market remained optimistic throughout the quarter due to a shortage of DAP inventory from the previous season, leading to higher prices. The expected resumption of government restrictions on DAP exports from China during March also contributed to increased purchasing activity from overseas markets. Limited phosphate shipments arrived via the Mississippi River, as their late arrival wouldn't benefit growers who were already finalizing dry product applications.
The United States played a crucial role in the North American DAP market, with prices witnessing an overall increase of 19% compared to the previous quarter. The domestic market displayed strong demand as growers anticipated favorable spring weather conditions for planting and made early fertilizer purchases. In the USA, DAP prices settled at a 6% increase during the second half of the quarter, compared to the first half.
APAC
During the first quarter of 2024, the Di Ammonium Phosphate (DAP) pricing for the APAC region continued to remain stable. Similar to the previous quarter, the demand from the agriculture sector remained weak, resulting in a balanced market situation. Additionally, moderate supply levels were observed as government regulations continued to restrict the export of fertilizers like DAP, leading to more products being available domestically in China, which is the largest producer of DAP. China, being a crucial player in the DAP market, experienced unchanged prices at USD 560/MT FOB Qingdao during February 2024. There were no significant changes in market conditions or policy updates that affected the pricing. The domestic demand for DAP in China remained steady due to the restrictions on exports. Nevertheless, concerns over these export limitations have prompted Asian fertilizer purchasers to explore alternatives to Chinese suppliers. However, at the end of March, Chinese producers began strategically entering the processed phosphate market, offering DAP at competitive prices as RCF of India received DAP quotes with a significant decrease from just a few weeks ago.
Europe
The European Di Ammonium Phosphate (DAP) market in Quarter 1, 2024 witnessed bullish price fluctuations due to several factors. During January 2024, the war undoubtedly presented significant hardships for European farmers as DAP prices within the country experienced low demand and no significant upward pressure due to the off-season for upstream ammonia purchases in Germany leading to relatively muted overall business activity. However, in the latter half, the scarcity of foreign DAP imports, particularly from China and the USA, caused by disruptions in the supply chain and logistical hurdles, played a crucial role in these dynamics during February 2024. This scarcity led to limited availability of DAP in the market, resulting in a notable price surge. Furthermore, the soaring freight costs also contributed to the pricing dynamics during this period.
In addition, major manufacturers like Yara adopted cautious production strategies, temporarily halting ammonia production, which raised concerns about the supply of DAP and further pushed the prices higher within Germany.
MEA
The first quarter of 2024 saw a bearish to a balanced market for Di Ammonium Phosphate (DAP) in the MEA region. In the latter half, the Di Ammonium Phosphate (DAP) market in the MEA region experienced moderate demand and a balanced market situation with lower agricultural activity globally, a well-stocked international market, and high freight charges. In terms of production, Saudi Arabia saw declining prices during January after Ma'aden resumed production at its Ammonia and Phosphate facility. This unusual stability was attributed to a balanced demand and supply as the continuous state-run Indian enterprises have been actively purchasing DAP from Saudi Arabia, Morocco, and Russia which kept the steady flow of cargo. The Houthi rebel strikes in the past have successfully redirected shipping lanes from the Red Sea, posing logistical difficulties for Saudi Arabia's exports of DAP. Inversely, this leads to an oversupply within Saudi Arabia even as it makes it more difficult for the country to access the global market. The price percentage change from Q3 2023 to Q4 2023 was 1%, and the price percentage comparison between the first and second half of the quarter in Saudi Arabia remained the same.
South America
In the first quarter of 2024, the Di Ammonium Phosphate (DAP) market in South America experienced international supply bottlenecks that influenced prices which admitted a bullish trend. The overseas market faced delays due to global shipping issues, tightening DAP flow into Brazil. Moreover, the Chinese manufacturers held onto stocks, forcing buyers to pay premiums for immediate availability. Panama Canal bottleneck which increased freight costs impacted shipments to South America, including Brazil. During March, the US market for DAP commanded a premium over other markets worldwide. This creates a situation where DAP prices in Brazil, while already high, were even higher compared to other regions. Moreover, the export capabilities at a key Russian port, Ust-Luga faced some technical pressure which created supply pressure to export DAP to Brazil in the meantime. The country has observed a moderate demand trend for DAP particularly driven by the downstream fertilizer industry. With the continuing cotton and sorghum growing operations, demand from important fertilizer markets was hampered by the unpredictable weather.
For the Quarter Ending December 2023
North America
The current quarter of 2023 for Di Ammonium Phosphate (DAP) in North America witnessed an overall bullish market situation, with the scarcity of key feedstock materials, such as natural gas and phosphoric acid, putting upward pressure on DAP prices.
Secondly, transportation lines in the US remained constrained due to low water levels in the Mississippi River and short supplies of railcars and truck availability. Thirdly, buyers' resistance to making bulk purchases led to a decline in import prices. However, November witnessed a moderate surge, as the cost pressure of essential feedstock Ammonia and Phosphoric Acid prices was limited during this timeframe.
The USA market witnessed a bullish trend during this quarter. The trend was mainly attributed to the elevated price of essential feedstock ammonia and phosphoric acid, coupled with a shortage of supplies within the regional market. Additionally, an anticipated increase in the price of ammonia and phosphoric acid within the country may lead to increased DAP prices. The quarter-ending price of DAP DEL Illinois in the USA was USD 563/MT.
APAC
The Di Ammonium Phosphate (DAP) market in the APAC region exhibited a bullish trend throughout the current quarter of 2023 (Q4) from October to December. Moreover, as compared to the previous quarter, DAP in the Chinese market rebounded with a hike of 4.36% amid supply constraints and high demand. During October, the rising prices of the vital raw material, phosphate rock, exerted upward pressure on the price of Diammonium Phosphate within the Chinese market. Further, the delayed resumption of production activities by some manufacturing units following the Golden Week holidays contributed to a material shortage in the Chinese market. However, the market situation in China was more volatile in November, and the prices of DAP fluctuated due to the limited availability of products in the global market, factory equipment malfunctions, and partial sales stoppages. Further, Diammonium Phosphate imports to the international market increased marginally during this timeframe which exerted upward cost pressure on Diammonium Phosphate prices. The latest/quarter-ending price of DAP FOB Qingdao in China for the current quarter was USD 568/MT.
Europe
The Di Ammonium Phosphate (DAP) market in Europe during the fourth quarter of 2023 witnessed a continued uptrend. Firstly, there was a scarcity of imported DAP, mainly due to a temporary halt in Ammonia production by Yara and decreased exports from European nations. This constrained supply, combined with escalated freight charges, led to a robust bullish sentiment in the market. Secondly, domestic demand for DAP in Germany remained moderate to low as end-user consumers in the fertilizer market maintained a reserved stance. The cautious approach taken by producers, influenced by mounting costs and logistical hurdles, contributed to the nuanced dynamics characterizing the German DAP market. Additionally, the closure of energy-intensive facilities, including Ammonia plants, by BASF further impacted supply. Moreover, the European gas hubs experienced a bullish trend, leading to restricted production of Ammonia and its derivatives, including DAP. This situation was exacerbated by the earthquake in Morocco, which damaged a major Phosphoric Acid producer, resulting in a scarcity of supplies in the regional market. Overall, these factors created a low supply and moderate demand environment in the European DAP market, particularly in Germany. The latest price of DAP in Germany for the quarter ending was USD 670/MT.
MEA
The fourth quarter of 2023 saw a bullish to balanced market for Di Ammonium Phosphate (DAP) in the MEA region, with a continued uptrend throughout November while maintaining stability during December. The demand from the international fertilizer market, particularly India and Brazil, remained strong throughout the quarter, with no notable price fluctuations in the Urea market. The limited availability of spot DAP in November and the resumption of production activities in the leading ammonia and phosphate plant in Saudi Arabia led to a moderate to low supply situation in the country, exerting upward pressure on DAP prices. The increase in essential feedstock Ammonia and Phosphoric acid prices within the country also contributed to the increased DAP prices. However, the declining feedstock Ammonia prices and ample availability of DAP in the global market led to a marginal stable market of DAP in December. The FOB price of DAP at Jeddah port in Saudi Arabia was assessed at USD 590/MT for the quarter ending in December, exhibiting an 18% increase from the previous quarter.
South America
In the fourth quarter of 2023, the Di Ammonium Phosphate (DAP) market in South America experienced various factors that influenced prices which admitted a bullish trend throughout October and December. Firstly, imported DAP supplies were scarce due to prolonged drought conditions in the Panama Canal, leading to limited exports to the region. Additionally, demand from the end-user fertilizer market remained subdued, as farmers were concerned about crop damage caused by the El Niño-related drought. This combination of reduced supply and weakened demand exerted upward pressure on DAP prices. In Brazil, which witnessed the most significant price changes in the region, DAP prices increased due to global market conditions. The emphasis on soybean and corn cultivation in the country led to a higher demand for fertilizers, including DAP. However, costly imports from the USA, coupled with the suspension of DAP exports from China, contributed to the rising prices. Furthermore, the depreciation of the Brazilian Real against the US Dollar added to the cost of imports and further supported the upward trend of DAP prices in Brazil.
For the Quarter Ending September 2023
North America
The Diammonium Phosphate (DAP) market displayed a mix of market sentiments in the third quarter of 2023. In July, prices decreased due to the underperformance of the downstream fertilizer sector, which was aggravated by prolonged drought conditions and reduced exports via the Panama Canal. However, in August, the market took on a bullish trend as there was a modest resurgence in demand. Domestic consumers were preparing for the upcoming planting season in September and October, contributing to the upward price movement. Prices continued to rise significantly in September, reaching USD 725/MT. This increase was propelled by strong demand, increased production rates, and limited availability of DAP. The escalating costs of key feedstock materials such as Ammonia, Phosphoric Acid, and Natural Gas led to higher production costs and subsequent price hikes. Hurricane Idalia disrupted production activities and led to the closure of terminals by Kinder Morgan, resulting in a supply shortage. Further, there was a substantial increase in international demand for DAP in late September 2023, partly due to reduced fertilizer exports from China. Data from the US Bureau of Labor Statistics showed a 0.5% increase in the Producer Price Index, indicating heightened consumption of goods in the country.
APAC
The Diammonium Phosphate (DAP) market in China saw fluctuations in the first month of the third quarter but then experienced a continuous increase throughout the third quarter of 2023 and settled at USD 530/MT on a FOB basis at Qingdao port. Prices significantly declined from June 2023 to July 2023, primarily due to weak purchasing activities from international and domestic fertilizer markets. Additionally, China reduced its exports during the year, with a significant drop of 12.4% in June, resulting in accumulated inventories in the country. This contributed to a narrower demand-supply gap, influencing the prevailing price trend. Conversely, Chinese Diammonium Phosphate prices saw marginal increases throughout the rest of the quarter. This was driven by renewed demand for fertilizers from the downstream fertilizer market, rising prices of feedstock like Ammonia and Phosphoric Acid, and limited supply of DAP in the Chinese market. Robust demand for Diammonium Phosphate persisted in the international market, particularly in India and Brazil. Spot availability of Diammonium Phosphate in the Chinese market was limited as producers focused on fulfilling supply contracts. Further, data from the National Bureau of Labor and Statistics showed that the new order index remained relatively stable, with a slight increase from 50.2 in August 2023 to 50.5 in September 2023. This was accompanied by a notable increase in the Production Price Index, indicating increased consumption of goods in the country.
Europe
The Diammonium Phosphate (DAP) market in Europe witnessed fluctuations in the initial month of the third quarter but subsequently showed a continuous increase throughout the entire third quarter of 2023 and settled at USD 590/MT on an FOB basis at Hamburg port. In the German market, prices declined in July due to diminishing costs of the feedstock, Ammonia, and reduced demand from the end-user fertilizer sector within the country. Additionally, energy prices in the European region hit their lowest point for the year during this month. However, in anticipation of the upcoming winter season and barley planting, buyers were poised to re-enter the market to procure fertilizers. Prices took a significant upturn in August 2023 and continued to rise through September due to tight availability and renewed demand. Several factors played a role in this price increase. Russia, a major exporter of fertilizers to Germany, withdrew from a year-long grain deal. Furthermore, there was damage to 60,000 tons of fertilizer at the Odesa port and a fire in a fertilizer warehouse in Moscow, leading to reduced exports to Germany. Additionally, an earthquake in Morocco, a significant exporting country, caused considerable damage to a major feedstock Phosphoric Acid producer, resulting in a scarcity of Phosphoric Acid in the regional market and exerting pressure on the export of downstream derivative Diammonium Phosphate to the German market.
South America
The Diammonium Phosphate (DAP) market in Brazil saw fluctuations in the initial month of the third quarter but subsequently witnessed a continuous increase throughout the entire third quarter of 2023. In July, prices declined due to weak performance in the downstream fertilizer industry, which was influenced by unfavorable weather conditions affecting corn planting in the country. Excessive rainfall had hampered corn harvesting. Toward the end of July, there was a modest increase in demand from the northern regions due to drier conditions, which are favorable for corn harvesting. Drought conditions and low water levels in the Panama Canal caused delays in exports from the USA, resulting in a shortage of material in the Brazilian market. Additionally, in September, the imported Diammonium Phosphate market in Brazil experienced a notable price increase. An earthquake in one of the major exporting countries, Morocco, significantly damaged a major Phosphoric Acid producer, leading to a scarcity of Phosphoric Acid in the regional market and putting pressure on the export of downstream derivative Diammonium Phosphate to the Brazilian market. Furthermore, demand remained strong in the downstream fertilizer market during the corn and soybean planting season. The combination of these factors led to a balanced gap between demand and supply, supporting the current price hike. Henceforth, the CFR price of DAP at Manus port was assessed at USD 538/MT.
Saudi Arabia
The Diammonium Phosphate market in Saudi Arabia experienced fluctuations in the first month of the third quarter but showed a subsequent increase throughout the entire third quarter of 2023. During July, prices declined in the wake of diminishing cost of the feedstock, Ammonia, and Phosphoric Acid and a waning demand from the end-user fertilizer sector within the country. However, Anticipating the imminent winter season, buyers are poised to re-enter the market to procure fertilizers for barley planting. The FOB price of DAP at Jeddah port took a significant upturn in August 2023 and continued to rise through September and settled at USD 511/MT amidst tight availability and revived demand. The elevated cost of essential feedstock, Natural Gas, prompted higher production rates, consequently leading to an increase in Ammonia prices. Demand perspective for Ammonia remained robust, particularly from international markets like India and Brazil during August 2023 and September 2023. The Saudi Arabian Mining Co., known as Ma’aden, has signed four initial agreements aimed at doubling imports of Ammonia and phosphate fertilizers to India in 2023. Further, it was observed that DAP suppliers were active in Bangladesh during this period. Additionally, despite global challenges, Ma’aden has renewed its agreement with the Bangladesh Agriculture Development Corporation to supply 60,000 tons of fertilizers to Bangladesh.
For the Quarter Ending June 2023
North America
Through the second quarter of 2023, Diammonium Phosphate experienced a consistent decline in the North American region. The decline was primarily driven by decreasing prices of its feedstock Ammonia and upstream Natural Gas. According to data from the US Bureau of Labor and Statistics, the Natural Gas Index decreased by 2.6% in the month, marking the fourth consecutive decline in that index. Additionally, the market faced a lack of procurement orders as consumers were hesitant to make bulk purchases due to rising inflationary pressures and hiked interest rates. Furthermore, low water levels in the Mississippi River, caused by high temperatures, hindered exports to other countries resulting in an excess supply of the material in the USA market. Consequently, overall, the market situation for Ammonium Chloride remained bearish during this quarter, largely due to a lack of buying enthusiasm from the end-user fertilizer segment. However, as indicated by the Federal Reserve of Economic Data, the Consumer Price Index of the USA has shown a marginal rise from 302.91 in April 2023 to 303.29 in May 2023 and is expected to increase further.
APAC
The Diammonium Phosphate market declined throughout the second quarter of 2023 in the APAC region. This decline in prices was primarily influenced by declining feedstock Ammonia and upstream Coal prices. In June, the recorded price was USD 564/MT on a FOB basis in China. Further, during this quarter, China has reduced its exports after a year. The exports tumbled by 12.4% in June, consequently leading to surplus availability of material in the China market. Additionally, the buyers were cautious in making bulk purchases amidst inflationary pressures and the global economic slowdown. Further, declined procurement orders from exporting counties, particularly India, due to inadequate rainfall in the month of June also supported the current prevailing price trend. As per data from the National Bureau of Labor and Statistics, the Purchasing Manager Index is declining and has been recorded at 48.8 in May 2023 after a marginal decline of 0.8% from the previous month, along with a decrease in industrial growth rate from 5.6 in April 2023 to 3.5 in May 2023.
Europe
During the second quarter of 2023, the Diammonium Phosphate market witnessed pessimistic sentiments. The prices were declining in the wake of growing inflation caused by the ongoing war in the region and the global economic slowdown. In an effort to curb inflation, the European Central Bank raised the interest rates high in the region. As a result, the buyers were reluctant to make bulk purchases due to hiked interest rates. Inflation in Germany slowed down from 6.1% in May to 5.6% in June, but as per data from the German Federal Statistical Office, the Consumers Price Index declined by 0.1% in May 2023. Further, as indicated by Eurostat, the Producers’ Price Index of the region declined to 138.3 in May from 143.4 in March and is expected to decline further. The average decline was 3.6%. Overall, the market situation for Ammonium Chloride remained bearish during this quarter, with low buying enthusiasm from the end-user fertilizer segment amidst growing inflation in the region.
South America
Throughout the second quarter of 2023, the prices of Diammonium Phosphate exhibited a downward trend in Brazil. In June, the recorded price reached USD 510/MT on a CFR basis. This decline in prices was majorly driven by declined prices of DAP and its feedstocks in exporting countries, particularly China and the United States, along with eased freight charges. Further, Brazil has been experiencing a dry season since May 2023, which has impacted farming activities in various regions of the country. This led to declining purchasing activity during this quarter. It was observed that the purchases from the fertilizer segment slumped by 16% by the end of May 2023. As we approach the end of this quarter, it was observed that 44% of the total product has been sold, and the demand-supply gap is narrowing. Further, amidst growing inflationary pressure and global economic slowdown, consumers were hesitant to make bulk purchases. This cautious approach is observed in the market where consumers are reluctant to make bulk purchases.
Saudi Arabia
Similar to the trend in the global market, the prices of DAP showcased a downward trajectory in Saudi Arabia in the second quarter of 2023. The prices declined by 29.7% from April to June this year on the back of weak demand from the fertilizer industry and declining prices of feedstock Ammonia and Natural Gas during this quarter. Additionally, it was observed that due to cheap shipments from the Russian Federation via the black sea to importing countries like India and Brazil, market participants of Saudi Arabia were forced to keep their prices low from April to June. The depreciating demand dynamics of the material in the market, coupled with ample availability of the material, have paved the way for a narrow gap between demand and supply. However, Saudi Arabia’s Investment and an Omani firm have signed a memorandum agreement of understanding to establish a fertilizer plant in the Kingdom to boost its agricultural production. The depreciating demand dynamics of the material in the market, coupled with ample availability of the material, have paved the way for a narrow gap between demand and supply.
For the Quarter Ending March 2023
North America
Throughout the first quarter of 2023, the price of diammonium phosphate decreased by around 9%. The DAP prices remained low because of the significantly reduced impact on downstream end users during the slow demand. Domestic DAP producers witnessed a significant reduction in the feedstock Phosphoric Acid contract price to maintain their profitability. Manufacturers have found it challenging to lower the cost of their raw materials as a result of the declining price of natural gas on the worldwide market. Additionally, DAP prices decreased at the end of Q3 as more supply grew. In March 2023, DEL Illinois sold Di Ammonium Phosphate for USD 573/MT.
Asia Pacific
Diammonium Phosphate prices fell in the first quarter of 2023 as a result of lower demand. The cost of Diammonium Phosphate decreased by about 2.81% in China. The above-average spot supply in the local market has caused a steady decline in the price of Diammonium Phosphate. While downstream companies' purchasing intentions remained muted, the market's pricing trend remained consistent. The cost of raw materials remained low due to low-cost support and a sluggish Ammonia market. While downstream companies' purchasing intentions remained muted, the market's pricing trend remained consistent. Supply surged as recent manufacturer shipment delays put more pressure on stockpiles. The domestic market contributed to the effects of imported goods on an increase in domestic supply. On the other hand, the downstream lacked support and had a weaker
Europe
During Q1 2023, DAP prices in the European region majorly had a fall throughout the quarter. DAP demand remained subdued due to the lack of demand in Europe, which led to an excess in the market. Transport of commodities was made possible by the mainly consistent downstream demand. While waiting for potential customers who are prepared to make sizable purchases during the first quarter, when the price remained muted, dealers and sellers prioritized protecting margins. Prices for Di Ammonium Phosphate (DAP) FD Hamburg (Germany) were estimated at USD 1135/MT in January 2023, a quarterly reduction of 17.28%. Consumers of Di Ammonium Phosphate also don't notice many fresh orders. The majority of them employed a wait-and-see approach, and the majority of downstream procurement actions only entailed a minor sum.
For the Quarter Ending December 2022
North America
Di ammonium phosphate price trajectory in the US market increased initially and then moved downwards. The Feedstock Ammonia became short in supply as many industries cut back on production. However, DAP prices fell in November and December as demand slowed. Consequently, the price of DAP in the US market fell further in the latter half of the fourth quarter. Statistics indicate that feedstock natural gas prices fell by over 15% in November 2022 and that this trend continued into December. The drought conditions and the country's inflation rate decreased the amount of phosphate produced for the local market, as consumption was expected to fluctuate at the lower end. Prices for Di Ammonium Phosphate (DAP) DEL in Illinois were calculated at USD 868/MT.
APAC
The pricing trend for Di Ammonium Phosphate in the Asia-Pacific area remained low in Q4 due to a lack of demand from downstream fertilizer markets. It was anticipated that demand for Di Ammonium Phosphate Fertilizer would rise dramatically during India's rabi season in October. However, this did not happen, and the market saw a lack of new orders during this period. The final week of October saw a slowdown in demand for Di ammonium Phosphate following China's National Day holiday. Demand was mostly maintained by the downstream phosphate fertilizers. Weakness in the DAP price in the Chinese market was a result of persistently low demand throughout the post-harvest season. Prices for Diammonium Phosphate (DAP) FOB Qingdao were estimated at USD 639/MT for the quarter ending in December.
Europe
There were mixed sentiments regarding the pricing pattern for Di Ammonium Phosphate (DAP) in Europe throughout Q4 2022 since feedstock reliance remained a key determinant in prices. Fertilizer industries continued to be under pressure since industries' production was seen to be below average. Downstream importers began hoarding ahead of the winter season's demand for fertilizer because they anticipated that wintertime supply would be constrained. Operating rates for domestic production were held in control despite the ongoing increase in energy prices. The accessibility of imports from Asia and the USA has been restricted by labor unrest and port congestion in various German ports. As inventory levels dropped, supplies remained insufficient.
For the Quarter Ending September 2022
North America
With no to very few inquiries, the prices for Diammonium Phosphate remained consolidated at the lower level in the domestic US market. The demand remained sluggish, whereas supplies grew in the market. Labor issues at cargo ports resulted in a bottleneck supply chain and reduced export offers in the last week of July. Traders and sellers indulged in making sales from the piled-up inventories at reduced prices, and the high inflation rate diminished the buying interest among the buyers. Moreover, the decline in new export offers also conclusively affected the price momentum of Diammonium Phosphate in the North American region. The production of Phosphate fertilizer across the country is threatened by Hurricane Ian, which will increase the price of production in the US to an all-time high. Also, the production is hampered by the ongoing upstream volatility.
APAC
The price of DAP in the APAC market fell during the third quarter of 2022 due to a decline in phosphate availability in India. India imports 31% of its DAP from China; therefore, a lack of supply is also apparent in the Indian market this quarter as the operating rate of DAP in Chinese factories has decreased. Traders voiced their displeasure with DAP's availability and costs. Due to the crisis between Russia and Ukraine, prices for natural gas, a crucial raw material for the production of fertilizers, also increased in the final weeks of the quarter. Diammonium phosphate (DAP) prices rose by 4% on the domestic market as a result of rising nitrogen prices, and phosphate rock prices rose by 6%.
Europe
Diammonium phosphate prices soared in Q4 2022 on the back of soaring feedstock Ammonia and Phosphate. Energy costs, including the distribution of natural gas and electricity, continued to be the main driver of price increases. Furthermore, Operating rates for domestic output were kept in check even as energy prices continued to rise. Labour unrest and port congestion in numerous German ports have hampered the availability of imports from Asia and the USA. Supplies remained insufficient as inventory levels declined. Fertilizer industries remained under pressure as the output of both industries was termed underwhelming. In anticipation of lowered supplies during the winter season, downstream buyers started stockpiling ahead of Winter season demand for fertilizers.
For the quarter ending June 2022
North America
The price of Di-Ammonium Phosphate dropped during Q2 of 2022, roughly declining by 10% in May, providing relief to downstream end users. Import restrictions affected fertilizer prices in the United States when Diammonium Phosphate (DAP) prices rose by 30% in the last year. Unexpected fluctuation in the price of Natural Gas in the international market has hampered production activities and forced producers to raise the cost of their material. Furthermore, Recent supply chain problems have compounded the country's pricing crisis. The prices offered at DEL Illinois for Di Ammonium Phosphate were assessed at USD 1054/MT during June 2022, the last weekly average of DAP during Q2.
Asia Pacific
Diammonium Phosphate prices escalated this quarter due to firm demand amid a global shortage. The cost of Diammonium Phosphate in India increased by 1.7%. The DAP (CFR) price has increased by approximately 65.66% on a Y-o-Y basis during May, from USD 566/MT in May 2021 to USD 947.21/MT (INR 73500/MT) in May 2022. At this time, Diammonium pending orders are nearing completion, the focus has shifted to export, and export orders have increased. Raw materials prices remained higher, thus pressuring the producers, owing to low-cost support and a strong Diammonium market. Meanwhile, Fertilizer production, imports, and transportation in China have been disrupted because of the COVID pandemic, war repercussions, and coal shortage. All the ripples were sent to the Diammonium phosphate prices this quarter.
Europe
In Europe, the demand for DAP remained high due to high natural gas prices, which created an energy crisis in the region. However, the production of agrochemicals continued to be low due to movement restrictions amid the rapid spread of COVID 19. In anticipation of good seasonal demand, several buyers asked for early contract purchases of DAP that increased the imports and its prices by the end of Q2 2022. Di Ammonium Phosphate (DAP) FD Hamburg (Germany) prices were assessed at USD 1135/MT during June 2022. Furthermore, the war in Europe greatly impacted the prices of Diammonium Phosphate. Also, because of the logistical constraints, DAP prices rose in Europe.
For The Quarter Ending March 2022
North America
DAP prices in the United States increased in the first quarter of 2022. In the Gulf of Mexico, DAP prices have risen to some extent. Market volatility has been compounded by the fast-spreading Omicron variant of SARS-Cov-2; energy, fertilizer, and freight prices have remained high, placing downward pressure on downstream consumers; and geopolitical concerns have exacerbated market instability in the quarter. As a result of the conflict, Russia, the world's largest fertilizer supplier, has hindered shipping and raised Natural Gas prices which is a major component in fertilizer production. DEL Illinois prices for Di Ammonium Phosphate in North America was assessed at USD 900/MT during the month of March 2022.
Asia Pacific
Due to a severe shortage of the product in the APAC area, diammonium phosphate prices have continued to rise in the first quarter of 2022. Prices for diammonium phosphate (DAP) have been stabilizing in recent weeks after reaching new heights. Traders expressed their dissatisfaction with the availability of DAP and its prices. The price of DAP changed marginally due to a decrease in phosphate availability in China. This quarter, the domestic operating rate of DAP in industries fell by 20%. China's Hubei production facilities, which generate the majority of the country's DAP, have been temporarily shut down, worsening the scarcity. Due to the Russia-Ukraine war, natural gas prices, a critical feedstock for fertilizer production, also jumped in the last few weeks of February. Di Ammonium Phosphate (DAP) CFR JNPT prices in India were assessed at USD 165/MT, whereas FOB Qingdao was USD 597/MT in first quarter of 2022.
Europe
Diammonium Phosphate prices in Europe climbed during Q1 2022 and stayed largely higher in the months of January to March 2022. Higher input expenses, as well as fuel and transportation, had put pressure on farmers' budgets around the world. Since last quarter, European natural gas prices have been at all-time highs, keeping DAP prices high and its availability limited in the region. Increasing energy costs, supply constraints, and trade policies have pushed up prices. High DAP costs pushed up fertilizer prices, exacerbating DAP production worries at a time when the COVID-19 epidemic and climate change are making DAP production more challenging. Prices in the European region were reported at USD 955/ton in 1st quarter 2022.
For the Quarter Ending December 2021
North America
On the back of stronger demand in the spring season, DAP values hovered around historical highs in the fourth quarter of 2021. Reduced supply availability exacerbated the pricing impact of decreased spring demand, with some industry observers predicting DAP demand losses. On the supply side, Chinese and Russian export restrictions reduced global availability marginally in the quarter, increasing import competition and generating new offshore supply concerns, as US trade flows have just recently adjusted to the loss of Russian and Moroccan shipments. Higher prices are also dampening consumer expectations in a number of key global markets. For the last week of December, DAP prices in USA were quoted as USD 760/MT DEL Illinois.
Asia Pacific
Diammonium Phosphate price took a sharp uptrend this quarter on the back of firm demand amid global shortage. Chinese government announced ban on exports for several phosphates, that directly affected the supplies in Indian market. Moreover, arrival of Rabi season had increased demand in India. The price increase was caused by strong domestic and global demand, low fertiliser inventories, and the domestic fertiliser industry's inability to adjust production levels. Upstream Natural gas prices have risen dramatically during the quarter, affecting the prices of all fertilisers. CFR JNPT prices increased to INR 59 per kg in the Indian market, while Chinese offers during December last week were quoted as USD595/MT FOB Qingdao.
Europe
In Europe, the demand for DAP remained high due to high natural gas prices which created energy crisis in the region. Although the production of agrochemicals continued to be low due to movement restrictions amid rapid spread of COVID 19. In anticipation of good demand in winter season, several buyers asked for early contract purchases of DAP that increased the imports and its prices by the end of Q4 2021.
For the Quarter Ending September 2021
North America
In the North American region, Di Ammonium Phosphate (DAP) market outlook appeared bullish with robust demand and tight fundamentals which kept the prices in the upward trend during the third quarter. By August end, most of the industries and refineries across the Gulf Coast of the USA were shut as a repercussion of Ida hurricane that consequently impacted the production as well as supply chain in North America. However, an improvement in the offtakes from end users was observed in this timeframe following the rebound in industrial and commercial activities. Thus, FOB NOLA Diammonium Phosphate prices hovered around USD 650-700 per MT in September showcasing a surge by around USD 60-110 per MT during this quarter.
Asia
In Asia, prices of Di Ammonium Phosphate observed an exponential rise backed by the firm demand from the downstream sectors amidst its constraint availability during Q3. In China, a steep rise in the values of feedstock was witnessed that led to the surge in the prices of DAP across the region. Additionally, several other factors such as low production rates due to energy crises and supply disruption backed by the congestion on several ports of China further contributed to the hike in the pricing trend of DAP in this timeframe. Likewise, Diammonium Phosphate prices soared in India backed by the limited supply and sturdy demand from the downstream manufacturers. In addition, spiraling freight charges and unavailability of containers also sent ripples to the values of DAP. Therefore, monthly average prices of DAP stood at USD 652.49 per MT in September with a rise by around USD 60 per ton since July.
Europe
During the third quarter of 2021, soaring prices of Natural Gas due to tight supplies led to the constant increment in the values of DAP in Europe. Many leading manufacturers were compelled to cut down their production rates due to the energy crisis in Europe which consequently aided the pricing trend of DAP. Further, spike in the prices of feedstock Ammonia and Phosphoric Acid in the global market also influenced the values of Diammonium Phosphate in Europe during Q3 2021. However, demand for DAP remained firm throughout the quarter from the downstream sectors.
For Quarter Ending June 2021
North America
Improvement in farming activities under improved weather conditions increased the demand for Diammonium Phosphate (DAP) in USA during the second half of the quarter. Initially in April, DAP prices observed decline due to ample spot availability in the country and staggering demand. However, in the second half of the quarter prices gained upward momentum supported by clear weather and increased offtakes from end users. Therefore, prices of DAP reached USD 624/MT in the mid of June. In addition, amidst stable offtakes, availability remained sufficient to satisfy the need and thus the prices-maintained stability throughout the last month of June.
Asia
Diammonium Phosphate demand in Asia remained firm during this quarter amidst critical shortage across the region. In India, an astonishing rise of around 40%-60% was observed in retail prices of DAP during end of May, backed by strong demand and firming feedstock value. Therefore, with firm demand outlook prices of DAP hovered around USD 509/MT during May ending 2021. To counter the huge spike in prices, government had to intervene to provide subsidy and safeguard farmer’s interest. Similarly, in China, prices of DAP shot steeply in the meantime, due to high import demand from Bangladesh and other global market.
Europe
High global demand raised prices of Diammonium Phosphate in Europe during Q2 2021. Import demand of Europe remained high in the meantime and traders were ready to pay high prices on cargoes coming from India and Middle East. In addition, increase in feedstock Ammonia and Phosphoric Acid prices due to shortage, also contributed to the rise in DAP prices in Europe. On the demand side, demand for DAP from end users remained high enough to encourage this steep rise in the region.
For the Quarter Ending March 2021
North America
DAP remained resilient from Q4 2020 across the region and globally during Q1 2021, hence the price acceleration continued, further affected by winter storm hit US gulf. This price acceleration was due to the shortage of upstream materials, like Nitrogen. Several Nitrogen producers shut their plant operations under extreme cold which eventually led to the shortage of feedstock Ammonia. Under these conditions prices of DAP skyrocketed across the region and reached USD 576.7/MT till March. This price hike was also supported by high local demand which eventually led to increased dependency for imports from Europe.
Asia
The Asian region saw moderate to low domestic demand for DAP, but high export demand from the US and Europe. Domestic demand for DAP in China remained moderate, but export demand was higher than anticipated, owing to a shortage of local material caused by lower availability of upstream natural gas, which effectively forced prices to rise in the region. Meanwhile in the Indian DAP market, domestic demand from the agriculture sector was low, hence the producers increased their exports to satisfy high demand coming from the US and Europe. Despite of stable demand from the Indian markets, retail prices of DAP showed a sudden increment of more than 50% during the quarter, buoyed by the global upsurge in rates.
Europe
Europe witnessed high demand for DAP from the agriculture sector due to the arrival of spring season. As the demand from domestic and international market was high, manufacturers were looking forward to increasing the prices of DAP in the coming months. Shortage of DAP in the US also forced European manufacturers to enhance their export volumes to enhance their margins and high premium on prices.
For the Quarter Ending December 2020
North America
In early Q4 2020, tight supply of DAP and other phosphate salts in the region accelerated the prices of most agrochemicals. The tight supply was a repercussion of the lower production rate due to damage caused by a spate of hurricanes in October. Later in December 2020, the demand remained firm, but the supply marginally decreased, which again caused a rise in DAP prices. Although the month over month increment in the regional production rates gradually eased its prices by December end.
Asia
Asian Diammonium Phosphate market remained firm in Q4 2020 driven by its appreciable consumption from the fertilizer industry. In China, before November, domestic supply of phosphate fertilizers was deemed low, as various manufacturers were more inclined towards catering to the global demand under expectations of better netbacks. By November, DAP imports from USA considerably reduced that created a shortage of DAP and other phosphate fertilizers in various countries across the region. Besides, favourable weather conditions amidst rabi season provided a favourable push to DAP’s market sentiments in India.
Europe
In Europe, the demand for DAP remained low, as only few countries participated in the spot buying activities while most of them stayed muted. Although the production of agrochemicals continued to be low due to movement restrictions amid rapid spread of COVID 19. In anticipation of good demand in spring season, several buyers asked for early contract purchases of DAP that increased the imports and its prices respectively by the end of Q4 2020.
