ICL and China Sign Potash Supply Agreement for 2025–2027
ICL Group Ltd has announced a significant framework agreement with China to supply a total of 2.5 million tons of potash between 2025 and 2027, with an additional optional supply of 960,000 tons. The agreement stipulates that potash prices will align with prevailing market rates at the time of delivery.
This strategic partnership not only strengthens ICL’s position in the Asian market but also expands its influence in the global agricultural sector. The deal will help address China’s growing demand for potash fertilizers while supporting sustainable agricultural development worldwide.
As global demand for high-quality potash continues to rise, this agreement marks a major step forward in ICL’s collaboration with China’s agricultural market, solidifying the partnership on a new level.
Indian Urea Tender Boosts Market Confidence
On December 9, India’s National Fertilizer Corporation (NFL) announced a new urea tender, seeking to procure 1 million tons of urea. The tender closes on December 19, with results to be announced on December 20, and shipments scheduled before February 10, 2025. This announcement has significantly boosted global urea market confidence and driven price increases.
India has conducted six urea tenders this year, purchasing a total of 4.2 million tons, slightly below the 5.6 million tons procured in 2023. Amid the global downtrend in urea prices since mid-October, this tender has been a key driver of market recovery. Following the announcement, North African urea prices surged by $12/ton within 24 hours, reaching $371/ton. Meanwhile, new transactions in the European and Turkish markets exceeded 100,000 tons.
Prices in the Middle East have also risen. Oman’s SIUCI offered a batch of urea at $345–$350/ton FOB, up from the previous spot price of $335–$340/ton FOB. Southeast Asian FOB prices remained in the $335–$340/ton range, with one 30,000-ton shipment destined for Australia.
Additionally, Brazilian CFR quotes rebounded from $320/ton to $335/ton, reflecting increasing market activity.
China’s Phosphate Export Policy Remains Uncertain
China’s phosphate export policy continues to evolve dynamically. For the 2024–2025 period, export quotas have been set at 5 million tons for diammonium phosphate (DAP) and 2 million tons for monoammonium phosphate (MAP), divided into three implementation phases covering January 2024 to April 2025. This policy adjustment has opened new export opportunities for phosphate producers in Morocco, Saudi Arabia, and other regions.
From January to October 2024, China exported a total of 3.75 million tons of DAP and 1.66 million tons of MAP. During the same period, Morocco increased its phosphate exports from 8.8 million tons in the previous year to 10.2 million tons, reflecting a 16% growth. OCP, Morocco’s leading producer, plans to further expand its fertilizer production capacity to 15 million tons annually by 2024, with 12.8 million tons designated for export.
In contrast, Russia’s MAP exports to Brazil have declined as Brazilian farmers shift to alternatives like triple superphosphate (TSP) due to cost concerns. Currently, Brazil’s MAP prices are steady at $635–$640/ton CFR, a significant increase from $560–$565/ton CFR at the start of 2024, although prices have stabilized since July.
Potash Market: Stable Prices with Strong Demand
The global potash spot market remained stable in late November, but prices in Brazil continued to climb, with spot shipping prices reaching $290–$295/ton CFR, a 4% increase from the early November low of $283/ton CFR. For the first quarter of 2025, price forecasts range between $290 and $315/ton CFR, supported by strong demand.
In Southeast Asia, standard potassium chloride prices remained steady. While prices in Malaysia lagged behind other regional markets due to discounted older inventory, sellers remain optimistic about future trends. Overall, the global potash market is expected to see moderate price increases over the next six months, though significant surges are unlikely.
Ammonia Market: Supply Improvements May Lead to Price Declines
The ammonia market has remained subdued, with prices along the Suez Canal holding steady. However, with improving supply and continued weak demand, prices may face downward pressure by the end of 2024.
As production normalizes across multiple regions, the market is expected to adjust accordingly.
Summary
The global fertilizer market is being shaped by multiple factors, including India’s tenders, China’s evolving export policies, and shifts in the potash and ammonia markets.
India’s procurement activities have revitalized the urea market, while China’s policy uncertainties have created new opportunities for other exporting countries. Potash prices remain strong with stable demand forecasts, but the ammonia market may experience price declines due to improved supply.
Overall, the global fertilizer market continues to navigate a complex interplay of supply and demand dynamics.
Attention: The above information is for commercial reference only due to the diversity of information collected, and Kelewell is not responsible for the authenticity of the data.
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