Fundamentals: Supply Tightness Meet Demand Re-entry
Market attention is firmly on India, where an imminent urea tender is widely expected to be issued by RCF, targeting volumes of around 1.5 million tonnes. Some market participants anticipate issuance as early as later today or tomorrow, suggesting large-scale demand could formally enter the market early next week, setting the tone for February–March trading flows and forward price curve.
In parallel, ice restrictions have been imposed across key Baltic ports, preventing non–Ice Class vessels from loading. The logistical disruption is already feeding through to freight economics, with Baltic-origin freight reported $30–40/t higher.
Against this backdrop, urea prices have continued to firm, with these two developments working in tandem to reinforce further forward support across global benchmarks.
In North Africa, March-loading granular urea has moved into the mid-$500s/t FOB, with producers lifting fresh offers into the low-$510s/t FOB range. In Nigeria, granular urea is assessed at around $470/t FOB at the top end of market indications on the back of tight supply, particular for Dangote facing a strategic Ethiopian demand for over 550,000 tonnes of granular urea.
Arab Gulf (AG) FOB granular urea prices have jumped this week by $30/t to the low-$480s/t range.
Our read: with India re-entering, freight costs rising, and producer discipline holding, downside risk appears limited in the near term. Market bias remains skewed to the upside into mid-Q1, particularly if Indian buying coincides with sustained logistical constraints. Urea will continue to firm.
AFRIQOM Market Reporter
