The second-quarter phosphoric acid contract price has increased by $70/t compared to the previous quarter, driven by firm DAP and sulphur markets along with a sharp rise in ammonia prices and tight supply conditions.
Indian fertilizer major Coromandel International and Jordan-based Jordan Phosphate Mines Company have agreed on a second-quarter contract price of $1,360/t P2O5 CFR India, marking a significant increase from the previous quarter.
The new settlement reflects a $70/t P2O5 rise compared to the first-quarter price of $1,290/t, indicating strong upward pressure in the global phosphatic fertilizer market.
Higher Raw Material Costs Drive Price Increase
The increase in the phosphoric acid contract price Q2 is primarily driven by firm trends in key raw materials such as DAP and sulphur. Over recent months, prices of dry bulk sulphur delivered to Indian ports have surged by nearly 30%, supporting higher production costs for phosphoric acid.
At the same time, DAP prices in India have also strengthened. Earlier this week, an Indian importer secured 15,000 tonnes of DAP at $865/t CFR, pushing domestic prices 29% higher compared to early January levels.
Ammonia Tightness Limits Further Upside
Despite the bullish trend, the market is facing constraints due to limited availability of ammonia. Prices for ammonia delivered to India have surged by approximately 41% since the beginning of the year, creating cost pressure for producers.
However, tight ammonia supply is also acting as a limiting factor, preventing sharper increases in phosphoric acid prices.
Market Outlook Remains Uncertain
So far, no other Indian importers have finalized similar settlements with global suppliers, leaving the market direction uncertain. Future price movements will largely depend on:
- Availability of ammonia
- Trends in sulphur pricing
- Demand for phosphatic fertilizers in India
Overall, the latest agreement between Coromandel International and JPMC sets a benchmark for Q2 pricing, signaling continued firmness in the phosphatic fertilizer value chain.
