Fertiliser Newsletter - 2nd September 2022

Russia has been curtailing gas exports in response to Western sanctions over its war in Ukraine causing high wholesale prices and a shortage of gas. Recently Russian owned Gazprom announced a further cut in gas flow through the Nord Stream pipeline for 3 days, siting maintenance as the excuse. This is stoking fears that Russia could halt flows completely heading into the winter heating season.

Europe’s ammonia production capacity has shrunk further with more reductions expected as two Polish companies joined a growing list of fertiliser manufacturers cutting/stopping production due to the souring gas prices. Grupa Azoty (Polands largest chemical company) and Anwil have cut production. This means around 38% of Europe’s production capacity for Ammonia is now restricted.

European natural gas wholesale price (Dutch TTF, euros per MWh)      

Traders expect European gas prices to remain elevated for years to come, forcing the high cost of Nitrogen and reduced production. This has triggered Urea imports from countries less affected by Russia’s control of gas. We are seeing supplies from non-traditional markets such as US Gulf & Indonesia where quality is untested to European expectations.

Bartholomews remains committed to the UK market for continuity & quality of supply; sourcing Egyptian Urea and Spanish 27N + 12SO3 & ASN 26N + 37SO3 compounds from Feriberia.