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The North American Potash Sales Alliance announced a 50-cent increase in CIF for Asia and the entire Latin American spot market. These price increases reflect the new export price benchmark for the North American Potash Sales Alliance, which is a standard potassium chloride CIF of US$510 and large particle potassium chloride of US$525. According to industry sources, the North American potash sales alliance may also sell at a level higher than the basic export price. Due to the tight supply of large-particle potassium chloride, the price of large-particle potassium chloride may be raised again. If the Southeast Asian market accepts the price, the next step for the North American Potash Sales Coalition is to establish a new contract price with China and India. However, India had threatened two weeks ago that if the price was too high, potash would not be imported this year, so it is estimated that India will not sign the contract soon. At present, all suppliers have not commented on India's remarks because they believe that comments will only make things worse. At this point, they are likely to wait for the next meeting of the IFA, when the two sides can more fully consider the market situation. Some people think that China may step in at this time and determine the second quarter contract price before India. Obviously, despite the fact that sales are not very large at present, the prices in the international market are still strong, because almost everyone believes that potash prices will rise again in the second half of the year and therefore have purchased ahead of schedule. It appears that the intention of buyers in China in the second half of the year is around US$430. There is still a big gap between the price and the supplier’s intentional price, so the negotiation between both parties will be as difficult as India.
U.S. fertilizer research data shows that the supply of potash fertilizer in North America is tight, and inventories fell by 183,000 tons in March and fell to 1.79 million tons in physical quantities in March. The inventory was down 7% from the same period of last year and was down 26% from the average inventory in the past five years. North America’s potassium fertilizer production in March was 1.188 million short tons (pure amount), a decrease of 8% from the previous month and a year-on-year increase of 15%. The sales volume was 1,311,000 tons, an increase of 24% from the previous month and an increase of 13% year-on-year.
The icing at the St. Petersburg Port of the Baltic Sea is still affecting the shipment of potassium chloride, but the situation is now better than in the first quarter. The potash currently shipped by BPC is mostly sourced from Belarus. The April-June production of the Jordan APC has been sold in the first half of June.
Due to different subsidies for different nutrients, India's direct application of potassium chloride from April 2010 to March 2011 decreased by 16.8%, but the consumption of ternary compound fertilizer increased. It is reported that IFFCO has suspended production of diammonium in Candela's production line, producing only compound fertilizers. Therefore, the consumption of potassium chloride in compound fertilizers actually increases, so despite the decline in the sales volume of directly applied potassium chloride, the import volume is increasing.
Brazil's 5 to 6 months of potash CIF 520 to 530 US dollars has been basically established. The North American Potash Sales Federation stated that it sold 200,000 tons of large-particle potassium chloride to Brazil at a CIF price of US$520. In addition, Brazil also purchased 210,000 tons of goods from BPC, plus ICL's earlier exports. These three orders allow other Brazilian buyers to accept new prices.