US legislators urge rail agency to fix service woes
A bipartisan coalition of federal legislators has asked the US Surface Transportation Board (STB) to address flagging rail service that has curbed deliveries of fertilizer and other agricultural commodities this year.
More than 50 members of Congress signed onto a 29 June letter to STB, asking the railroad regulator to work to improve service for the agricultural sector.
The request comes as farmers gauge input requirements for post-harvest fertilizer applications later this year and pencil in expected volumes for next spring's crops. Prolonged rail service disruptions by major rail carriers could support higher costs for key inputs.
"We must ensure critical commodities reach essential industries and workers, such as America's farmers, who are essential to feeding our nation and the world," the letter said. "Food is a national security issue, and we must treat it as such."
Industry advocacy group The Fertilizer Institute (TFI) applauded the letter, adding that "skeleton crews" and railroad-led initiatives, such as the precision scheduled railroading operating model, have hampered fertilizer shipping and potentially lead to production delays. The model calls for increased efficiency to drive higher volume, creating a reduced need for crews and equipment.
"With the world leaning on US farmers now more than ever before to feed our growing population, we must ensure strong yields and our food security," TFI chief executive Corey Rosenbusch said on 30 June. "Fertilizer must reach farmers in a timely manner and crop harvests also need to get to their destinations, including the kitchen table."
Domestic fertilizer distributors grappled with slowing rail service during the industry's peak demand cycle, which began in the spring when farmers planted key principal row crops and applied fertilizer. Delays have hampered crop production at a time global grain output is threatened by the ongoing war in Ukraine and various US restrictions on imported fertilizers.
US railroad Union Pacific (UP) instructed fertilizer manufacturer CF Industries in mid-April to reduce its shipments by 20pc, which delayed urea and UAN deliveries prior to the key spring application period. CF said in an April statement that customer orders with rail transportation already arranged would likely face delays, and UP would not accept new rail shipments for the foreseeable future.
The four largest US railroad companies subsequently came under immense criticism this year for eroding service, underpinned by inconsistent and unreliable deliveries, which spurred an STB hearing on 26-27 April. Detailed recovery plans from each company point to a potentially slow return to pre-pandemic levels.
The legislators' letters said that if UP "continues down this path and other carriers follow suit, it will reduce crop production at a time when our nation and the world can least afford it."
More than half of US fertilizer is transported by rail, and shipment restrictions can limit supplies and raise farmer costs, according to TFI. US farmers this season already face an estimated 7pc rise in total input expenditures, with fertilizer costs expected to average 12pc higher compared with 2021, according to the US Department of Agriculture.
Fertilizer affordability concerns defined the 2021-22 season, which ended on 30 June, and cost woes will likely extend through the first half of the 2022-23 season if deteriorating rail service leads to higher input costs and food prices.
"By placing onerous restrictions on shippers without customer consultation, Class I carriers may run the risk of jeopardizing family run farms and increasing the cost of food for consumers," the letter said.
Related news posts
Qatar's Muntajat raises September sulphur price
Qatar's Muntajat raises September sulphur price
London, 29 August (Argus) — Qatar's state-owned sulphur producer and marketer Muntajat/Qatar Energy has raised the Qatar Sulphur Price (QSP) for September to $125/t fob Ras Laffan/Mesaieed. This is up by $19/t on its August QSP set at $106/t fob after spot prices rose. The latest spot tenders from Qatar and Kuwait have attracted several bids at $120s/t fob from trading firms. This follows a substantial rise of $25/t from July to August, when the latest round of price increases in the spot market started to filter through, as phosphate fertilizer prices firmed and some supply curbs limited output from the usual producers. The latest adjustment for September implies delivered pricing to China of $151-157/t cfr at current freight rates, which were last assessed on 22 August at $26-28/t to south China and at $30-32/t to Chinese river ports for a shipment of 30,000-35,000t. But with China cfr assessments at $134-139/t cfr on 22 August, delivered prices were below the implied range in the previous round of business, as buyers opted to wait and see what was the outlook for fertilizer exports prior to booking more raw material imports. By Maria Mosquera Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
India's NFL closes tender to buy urea, offers in
India's NFL closes tender to buy urea, offers in
Amsterdam, 29 August (Argus) — Indian fertilizer importer NFL has closed its tender to buy urea today, with initial unconfirmed feedback pointing to lowest offers at around or slightly below $340/t cfr west coast. NFL will evaluate and open technical offers on 30 August, with an expectation that prices will be officially revealed early next week. NFL has requested a shipment window from load ports up to 31 October. The lowest offer price, if confirmed, would reflect netbacks of around low-mid $320s/t fob Middle East and $280/t fob Baltic, accounting for freight rates and other costs. Indian appetite for fresh urea imports is strong, despite considerable inventories, driven by a strong monsoon. Participants expect that NFL could purchase at least 1mn t of urea under this tender. Rainfall rose by 7pc from the long-term mean since the start of June, which has buoyed domestic offtake. Urea sales to consumer could hit as high as 5mn t this month, up from 4.68mn t in August last year. By Harry Minihan Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
CMOC issues buy tender for sulphur to Brazil
CMOC issues buy tender for sulphur to Brazil
London, 28 August (Argus) — The Brazilian operation of Chinese metals producer and sulphur consumer CMOC issued a tender to buy 40,000 metric tonnes (t) of sulphur for late October delivery at the Santos port's Tiplam terminal. The tender closes for offers on 3 September. The buyer last awarded a tender closed on 10 July for 40,000t of sulphur to arrive in September at Santos' Termag terminal priced at $119/t cfr. Other buyers have since bought spot tonnes in a higher spot market during August for September-October arrival priced between high $130s/t and low $140s/t cfr. By Maria Mosquera Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
EABC eyeing switch to DAP from NPS in large tender
EABC eyeing switch to DAP from NPS in large tender
London, 28 August (Argus) — Ethiopian Agricultural Businesses (EABC) is preparing to seek DAP in its annual large-scale fertilizer tender, rather than NPS/NPSB, Argus understands. Argus has been unable to confirm this with EABC. But several sources reported that the switch to DAP is being seriously considered, and one rated the change as highly likely. Typically, the corporation seeks large amounts of NPS and NPSB, and Moroccan major fertilizer producer OCP is awarded the full volume. In its 2023 tender — issued in August — EABC requested a little over 1.02mn t of NPSB and 332,300t of NPS, as well as 980,000t of urea. The NPS grades that EABC receives contain nutrient values of around 19pc nitrogen, 38pc phosphorus and 7pc sulphur. But it may be set to abandon complex fertilizers in favour of DAP this year. It is set to seek 800,000-1mn t of the phosphate product, one source said. The switch should allow the process to be more unpredictable, with various producers vying for awards, rather than one manufacturer being all but certain to supply the full amount. But global DAP supply is tight, keeping prices firm, which would make EABC's decision — if and when confirmed — all the more surprising. OCP has already sold 510,000t of DAP for September-November shipment to India, which is short of the grade because of lower imports earlier in the year. EABC is expected to issue its tender in the next two weeks. By David Maher Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
![](/_next/image?url=%2F-%2Fmedia%2Fproject%2Fargusmedia%2Fmainsite%2Fimages%2F14-generic-hero-banners%2Fherobanner_1600x530_generic-c.jpg%3Fh%3D530%26iar%3D0%26w%3D1600%26rev%3D-1%26hash%3DFC2BEDE406483FEF5FDB9549159BAC11&w=3840&q=75)
Business intelligence reports
Get concise, trustworthy and unbiased analysis of the latest trends and developments in oil and energy markets. These reports are specially created for decision makers who don’t have time to track markets day-by-day, minute-by-minute.
Learn more