The price of urea in the global market is reported to have spiked in the Middle East from India’s last contracted rate of $530/tonne (CFR). This has been attributed to the sudden demand from India amid declining stocks. On the other hand, Indian importers are hopeful of bringing down prices to about $500/tonne when the bids open on September 2.
The Middle East FOB price of urea was quoted at $506.25/tonne on Thursday, and about $30/tonne may be added as freight and insurance cost (CFR) to bring the crop nutrient to India, experts said. Urea is not globally traded on any platform, and rates are many a times decided between buyers and sellers (or their representatives), based on mutual negotiations.
“Already Indonesia and Malaysia are reported to have convinced China to lower the urea rate, and India may also get a quote close to around $500/tonne (CFR) in the next round. If that happens, producers in the Middle East will likely lower their rates,” an industry source said.
