Demand for straight nitrogen fertilizers in France, particularly urea and urea ammonium nitrate (UAN), increased sharply following the government's subsidy announcement on 9 July, as initially reported by Argus Media.
Farmers will receive at least €50/t (US$57/t) on purchases of straight nitrogen fertilizers made between 1 June and 30 September, rising to €70/t where fertilizer accounts for more than 10% of operating costs.
Urea buying accelerated immediately, with prices rising to €495/t fca from around €460/t fca. Interest also strengthened for sulfur-enriched granular urea (40N+14SO3), with it being reported at €460/t fca in big bags.
UAN 30 demand also surged, but prices remained initially unchanged at €370/t fca Rouen, and with large sales volumes reported. Some offers reached €380/t fca while several suppliers withdrew offers pending a reassessment of market levels.
The impact on AN 33.5 and CAN 27 was less pronounced, but some European producers withdrew offers from the market.
Market participants also expressed concern that the subsidy could further divert demand away from NPK fertilizers and ammonium sulfate, which are not covered by the support scheme.
Original article written by Dana Hjeij for Argus Media.