text: 18 February 2011 17:24 [Source: ICIS news]
  By Carl Roache
  LONDON (ICIS)--It's been a week since former Egyptian president Hosni Mubarak stepped down and all eyes are on the country as it looks to rebuild itself in the aftermath of the revolution.
  While the social and democratic changes that have occurred are clear, a less obvious impact of the Egyptian revolution has been its influence on the price of one of its major exports, the key nitrogen fertilizer urea.
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  Egyptian granular urea prices have been on a rollercoaster over the past month, largely because of the social unrest.
  While initially benefiting from the unrest in terms of prices, sellers are now being squeezed by the resulting conditions.
  In the lead up to the unrest, trader bids fell to $410-415/tonne FOB (free on board). Prices then climbed as the unrest escalated with a sale at $425/tonne FOB. Now prices are trending down towards $400/tonne FOB again.
  Commenting on Egyptian prices, an international trader said: “The only reason why prices were $425/tonne FOB was because of the unrest. Now there is more cargo around and no purchasing drive in
  Source: ICIS
  Just before the unrest really took hold at the end of January, Egyptian supplier Mopco requested bids for 15,000-20,000 tonnes of urea but was unsatisfied with those received, which are understood to have ranged from $410-415/tonne FOB. It decided not to sell at that point.
  Egyptian granular urea prices were under pressure because they were considered overpriced compared with material from other locations such as the
  The unrest then escalated and demonstrations crippled Egyptian trade. At the end of January and into early February, Egyptian urea sales were suspended due to logistical problems. Truck distribution networks were disrupted and there was a lack of stevedores at ports, as well as restrictions on loadings.
  Then on 3 February, Mopco sold 20,000 tonnes at $425/tonne FOB - its first sale since the unrest began. This price was a repeat of its previous sale in early January, which represented the highest level since 2008.
  Why had prices climbed again?
  The primary reason was the concerns over Egyptian supply, which had prompted a rise in urea prices in key markets such as the
  After two weeks of successive declines, US barge prices leapt $25/short ton during the week ending on 4 February, to $385/short ton FOB Nola (
  As a result of this, and the uncertainty of Egyptian supply, traders were prepared to pay high prices for Egyptian urea.
  However, by mid-February, an easing in the unrest had prompted a reversal of the price trend and now prices are declining steadily.
  The only sale in the week ending on 18 February in
  Price indications are now nearing $400/tonne FOB.
  “Nobody is accepting $405/tonne FOB,” said a seller.
  A pause in European buying has contributed to the lower levels seen but the effect of the unrest is also key.
  Firstly, ship owners are asking for higher freight charges to load at Egyptian ports, prompting lower bids from traders.
  “Now ship owners are reluctant to come to
  Freight for a 6,000-8,000 tonne size vessel from
  Some reports suggest it could be as much as $40/tonne for this route.
  The unrest has also impacted negatively on suppliers in another way.
  As one
  For example one Egyptian producer, Alexfert, still has 25,000 tonnes left to sell for February. Another, Helwan Fertilizer Company, has a total of 40,000 tonnes to place, while Mopco has 5,000-8,000 tonnes to sell.
  Looking forward, prices look set to continue trending downward.
  “European demand is a bit quiet. People today are choosing to wait,” said a major German-based trader.
  “Everybody is a bit more relaxed about
  Total Egyptian urea production in 2009 was 5m tonnes, of which 3.4m tonnes were exported. The main exporters are Orascom Construction Industries (OCI), Helwan Fertilizer Company, Alexfert and Mopco.
  Urea, which is 46% nitrogen, is a major fertilizer with close to 150m tonnes produced annually.
  ($1 = €0.74)