Urea Prices Rose Last Week

For the week ended February 23, standard and prilled urea prices were broadly higher at the locations discussed below.

Except for the Yuzhny location, prices in the above chart represent movement in the standard grade of urea. The Yuzhny location represents prilled urea prices. Urea prices for the standard grade in the NOLA (New Orleans) region of the US and in Egypt saw the steepest weekly change last week. In NOLA, the standard urea prices rose 0.8% to $230 per metric ton from $229 per metric ton a week ago. In Egypt, the standard urea prices also rose 0.8% week-over-week to $266 per metric ton from $264 per metric ton.

In contrast to these two locations, standard urea prices in the Middle East fell 0.4% to $254 per metric ton from $252 per metric ton a week ago. The prilled urea prices in the Yuzhny location also rose 1.3% week-over-week to $235 per metric ton from $232 per metric ton last week.

Last week’s momentum only added to the year-over-year gains in urea prices this year. Year-over-year, standard urea prices were up 13% in NOLA, 9% in the Middle East, and 2% in Egypt. However, the prilled urea prices in the Yuzhny location were still 4% lower year-over-year last week.

Recently, Nutrien (NTR) announced its 4Q17 earnings, in which it stated that the company’s margins improved as a result of an increase in benchmark prices globally. CF Industries (CF), which also reported its earnings recently, stated that exports from China declined by 65% in the past two years. These factors support higher urea prices and may also prove positive for CVR Partners (UAN) and Terra Nitrogen (TNH).

Next, we’ll discuss prices of natural gas, a key input for nitrogen fertilizers in North America (MOO).