Fertilizers

UREA

• Urea prices are still some 50 percent higher than one year ago, and although end-2004 levels, prices are not expected to decline in the near future as strong demand persists.

• Domestic demand for Urea in China has picked up. Urea exports from China will be considerably lower in 2005 compared to last year when the export tax and abolishment of the VAT rebate on urea exports is maintained to ensure adequate supply for the domestic market. Substantial additional imports of over 1 million tonnes are envisaged.

• Demand in Latin America is being met through imports from the Black Sea region and Europe.

• Nigerian imports are scheduled from the Black Sea region; while Ethiopian imports are arranged from the Persian Gulf.

• Urea prices in the United States peaked in early March and prices are expected to decline as the planting season progresses and demand eases. Imports in the United States and Canada are scheduled from the Persian Gulf.

• Demand in Asia is expected to increase, especially in India, Pakistan and Sri Lanka. Substantial Indian imports are scheduled from the Black Sea and Persian Gulf regions. Pakistan is yet to establish its Kharif season’s import requirements and Sri Lankan imports are scheduled for the coming three months.

DAP

• DAP prices are declining from the peak at the end of 2004 but are over 10 percent higher than a year ago. Prices are expected to remain relatively unchanged in the short term.

• The United States’ domestic market is yet to show signs of seasonal take-off; however, steady exports to India, amongst others, continue. Indian DAP subsidy rates have been established.

• Pakistan has arranged to import from the Russian Federation and North Africa. Demand in Viet Nam has been met through imports from China, although at present demand is low because of drought.

• Temporary production reductions are scheduled in the United States, Tunisia and Jordan.

• The import season in Mexico is now fully underway and imports will continue in the short term.

• In China, consumption is forecast to grow significantly and, in response, DAP exports are expected to decline.

• Ethiopia schedules its seasonal requirements from the Persian Gulf and the United States.

MOP

• MOP prices are 25-40 percent higher than a year ago and continue to increase.

Japanese importers negotiated prices with Canadian exporters and further negotiations with CIS suppliers are scheduled.

Potash markets show a firm demand in the United States, India and China.

• Brazilian demand is expected to be firm in response to improved soybean prices.

India is importing large quantities of MOP to meet strong demand in South and East India.

• China is importing from the Russian Federation and Jordan. The Russian Federation’s exports by rail to China are envisaged to increase, due to persistent high ocean freight rates.

• Demand in parts of Thailand, Viet Nam and southern China is adversely affected by drought and in Europe by late planting and high nitrogen fertilizer prices.