While global urea prices have fallen roughly 14% since their peak in November, they are still over 50% higher than prices at the start of September 2021 ($456/t).
International urea prices have fallen sharply since mid-December when the market first showed signs of softening.
The Profercy World Nitrogen Index has fallen by 56 points or 12% since the start of the year. This is fuelling hopes that a market correction may be under way.
However, the index remains 55% higher than September 2021.
As prices declined from the start of the year, buyers are said to be staying out of the market unwilling to trade product until there are signs of price stability
Granular urea in the Middle East is currently trading at $804/ t, down 6% since the start of January. Urea prices peaked in mid-November at approximately $935/t.
As prices declined from the start of the year, buyers are said to be staying out of the market unwilling to trade product until there are signs of price stability.
The US urea market is also highly volatile with some reports of prices at levels of last September reflecting the bearish sentiment in the market.
Potash prices are more stable, influenced by economic sanctions hitting Belarus
However, farm gate prices for urea in the US are trading at approximately the equivalent of €817/t, similar to mid-December price levels. This is roughly 15% below current Irish prices.
Potash prices are more stable, influenced by economic sanctions hitting Belarus, which accounts for 20% of global potash exports.
Gas prices, which fell from their peak in December 2021 are now trading upwards as volatility persists in the market.
Natural gas is the key ingredient in the manufacture of nitrogen fertiliser, accounting for 80% of the costs.
The growing political crisis between Russia and Ukraine is hanging over fertiliser and gas markets.