USTR probe could limit US amsul imports
Ammonium sulfate (amsul) imports to the US could be impeded as the US Trade Representative (USTR) considers tariffs on EU nitrogen fertilizers as a part of larger dispute involving aircraft subsidies.
The US is considering imposing tariffs of up to 100pc on EU nitrogen imports, including amsul. Substantial tariffs on amsul from the EU would further restrict offshore options for US consumers and potentially open opportunities for Canadian exports to rise.
US amsul imports from the EU comprised more than 50pc of offshore volumes in 2018 and nearly 40pc during the first six months this year, according to customs data. But the EU's robust share in the US market is a recent shift in trade flow.
The US Department of Commerce implemented in 2017 a 206.72pc tariff on Chinese amsul imports following a nine-month anti-dumping investigation after growing to account for 61pc of amsul imported into the US in 2015.
EU suppliers, primarily Lanxess out of Belgium and Fibrant and OCI from the Netherlands, stepped in to fill in the gap China left in the US during the last two years. Imports meet about 30-33pc of estimated annual US consumption, indicating foreign product is still required to satisfy annual demand. But offshore options are limited for US consumers.
China is the leading exporter of amsul, shipping about 5.3mn-6.8mn t/yr between 2015-18, according to customs data. Belgium and the Netherlands — members of the EU — follow, exporting about 1.7mn-2.2mn t/yr and 725,000-2mn t/yr, respectively, during the same three-year period.
Canada could emerge as a larger amsul supplier to the US if the USTR implements high enough tariffs to lock out EU importers.
Canada has accounted for at least 34pc of US amsul imports since 2015 and could expand its market share as Nutrien leverages increased output at its Redwater, Alberta, facility.
Nutrien is converting its MAP unit at Redwater to double its amsul production capacity to 700,000 t/yr. Market participants widely anticipate the producer will utilize its bolstered output to further supply western Canada and the US Pacific Northwest in addition to the US' leading amsul consuming states. Wisconsin, Minnesota and the Dakotas are some of the leading amsul consumers in the US and best situated to receive increased rail volumes from Canada by way of the CN freight railway, potentially displacing US producers.
US producers could redirect volumes to the Midwest and southeast markets to minimize offshore requirements, or export their output.
Warehouse prices in the Midwest would likely react immediately to a stark shift in offshore supplies. Average monthly spot values throughout the Corn Belt sank by nearly 30pc in 2015-16 as lower-priced Chinese imports flooded the market and forced domestic producers to compete at lower price levels. Corn Belt warehouse prices jumped by about 8pc between January and February 2017 after the US handed down anti-dumping duties on Chinese imports.
The Midwest market has incrementally recovered during the last two years as import volumes remain below 2015 levels. Another change in trade flow, especially a restriction in volumes, would heighten market firmness and potentially support a near-term price rally.
Related news posts
US amsul stripping margin rises again in April
US amsul stripping margin rises again in April
Houston, 19 April (Argus) — The stripping margin for ammonium sulfate (amsul), driven by higher amsul prices, continued to rise in April even as variable costs grew. The stripping margin increased by nearly $24/st to $270/st for April, up by 10pc from March and up by 13pc from April 2023. Inland amsul trade exceeded $400/short tons (st) this month on continued supply tightness following production outages in the first quarter. Minimal length at New Orleans (Nola) spurred sellers to offer imported tons as high as $405/st fob for first half May delivery. Participants in the amsul market anticipate values to keep rising into May as supply tightness persists. Higher amsul prices have been partially caused by higher costs for inputs. The Tampa, Florida, ammonia contract rose by 7pc to $475/st in April from the month prior and the sulfur Tampa contract climbed by 17pc to $81 per long ton (lt) from the previous quarter. The cost of ammonia and sulfur were 8pc and 27pc lower than a year earlier, respectively. The total variable cost for amsul rose by $10/st in April to $143/st after holding steady in March. Rising ammonia prices have supported amsul variable costs but gains in the price of ammonia have not been as substantive as the market expected, sources said. Applications of ammonia in the US are slowing, which may weaken the price of the Tampa contract, but production outages could offset seasonal declines. Ma'aden's ammonia II plant is due to undergo a month of maintenance starting mid-April. Sulfur prices are expected to remain firm in the near term but lose momentum entering the third quarter on higher refinery utilization in the US and the return of Chinese exports of MAP and DAP, which could oversaturate the phosphate fertilizer market. Sulfuric acid is used to produce DAP and MAP. By Meghan Yoyotte Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Phosphates: Indian DAP stocks build in March
Phosphates: Indian DAP stocks build in March
London, 19 April (Argus) — DAP stocks rose by the equivalent of 2-3 import cargoes in March, or nearly 86,000t, as imports and local production outstripped offtake. Indian DAP production reached 218,900t in March, according to FAI data, down nearly 41pc on the same month in 2023. DAP imports reached 201,000t in March, down nearly 54pc on March 2023. Sales of DAP reached 334,200t, down nearly 12pc year on year. Stock draw/build, defined as production plus imports minus offtake, was plus 85,700t. This implies that stocks are still close to 2mn t of DAP, as estimated by the Indian government. Full fertilizer year DAP production (April 2023-March 2024) reached 4.29mn t, down around 1pc year on year. Imports were down 15.4pc at 5.57mn t, mainly due to the loss of supply from China owing to customs inspections, with sales at 10.8mn t, up nearly 4pc year on year. By Mike Nash Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
EPS to register six ammonia-powered newbuilds with SRS
EPS to register six ammonia-powered newbuilds with SRS
London, 17 April (Argus) — Shipping firm Eastern Pacific Shipping (EPS) will register six dual-fuel ammonia powered vessels, due to be delivered from 2026, with the Singapore Registry of Ships (SRS). The commitment is part of an initial agreement with Singapore's Maritime and Port Authority (MPA), vessel classification organisation American Bureau of Shipping (ABS) and Lloyd's Register. EPS said the collaboration with the MPA will extend to supporting crew and seafarer training on the vessels powered by "zero and near-zero emission fuels", in addition to pilot trials of these fuels, and building on the capacity and infrastructure required for ammonia bunkering. Argus assessed the price of green ammonia dob east Asia on a very-low sulphur fuel oil energy density equivalent (VLSFOe) at $2,608.90/t in March, a premium of over $1,975.08/t against VLSFO dob Singapore. Grey ammonia in east Asia was assessed at an average of $829.52/t VLSFOe across March, a premium of $195.70/t to VLSFO dob Singapore. By Hussein Al-Khalisy Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Singapore's MPA, IEA unite on maritime decarbonisation
Singapore's MPA, IEA unite on maritime decarbonisation
Singapore, 17 April (Argus) — The Maritime and Port Authority of Singapore (MPA) and the IEA have signed an initial deal to push the transition to zero and near zero emission fuels, while working on technology as well as digitalisation to meet the maritime decarbonisation agenda. The agreement, signed by MPA chief executive Teo Eng Dih and IEA executive director Faith Birol, was announced at the Singapore Maritime Week 2024 (SMW) this week. "Greater international collaboration in maritime and energy industries is critical for international shipping to meet international decarbonisation goals," Teo said. "Shipping is one of the hardest sectors to decarbonise and we need to spur development and deployment of new technologies to slow and then reverse the rise in its emissions," said IEA chief economist Tim Gould. "This will require strong collaboration at a national and international level." Training programmes will be built to support the adoption of new fuels. There will also be partnerships made towards fuel-related projects and initiatives such as the International Maritime Organisation-Singapore NextGen project. The IEA plans to open its first regional co-operation centre in Singapore, which will be its first regional office outside of its headquarters in Paris, France. By Mahua Chakravarty Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Business intelligence reports
Get concise, trustworthy and unbiased analysis of the latest trends and developments in oil and energy markets. These reports are specially created for decision makers who don’t have time to track markets day-by-day, minute-by-minute.
Learn more