UK government considers potential ban on all urea fertiliser
In a bid to keep in line with targets to reduce ammonia emissions by 8% of 2005 levels by 2020, and 16% by 2030, the UK government announced on Tuesday that it is considering action on the use of nitrogen fertilisers.
“A complete ban on urea use is one of three “cost effective” options being explored over the next three months as part of the country’s clean air strategy.
A second option involves a requirement to stabilise solid urea fertilizers with the addition of a urease inhibitor – a chemical that helps slow the conversion of urea to ammonium. The final suggestion is a total ban on the spreading of solid urea fertilizers outside of a 15 January to 31 March window” (ICIS).
Trade sources we’ve talked to at FIS don’t believe any immediate action will be taken in the near term, but do see a continued trend away from untreated urea use in European markets over the mid-long term.
Urea Values rangebound
On paper, urea values have been rangebound in AG/Egypt the past week as new demand is yet to emerge in physical markets post the latest Indian tender. The Chinese physical market however, has remained supported, which has in turn supported AG/Egypt values and made short sellers more cautious on paper. Brazil paper values have come under pressure, with limited buyers to resist building selling interest in the $260s.
Nov Brazil futures eventually traded Friday at $261, down some $11 on the last done level for the contract earlier in October. Nola urea futures meanwhile continue to trade on domestic fundamentals, remaining supported into the end of last week but coming under pressure for Q1 Tuesday, trading $233, down $4 on a week prior.