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The U.S. Energy Information Administration (EIA) projects that U.S. oil production will average 13.83 million barrels per day in August, up slightly from 13.82 million barrels per day in July; September production is projected to average 13.77 million barrels per day.U.S. Central Command: 82 vessels were redirected in the Strait of Hormuz, 3 were interfered with, and 2 were boarded to ensure compliance.On August 29th, US President Trump announced on social media that the United States had reached an agreement with Venezuela, gaining "majority control" over more than 65 billion barrels of Venezuelas proven oil reserves. Trump stated that the US and Venezuela collaborated, through partnerships with private companies, to acquire "majority control" of over 65 billion barrels of Venezuelas proven oil reserves, with US taxpayers bearing no cost. Trump claimed that this deal "will more than double the US oil reserves, significantly increase oil supply, and significantly reduce US gasoline prices for a long time to come." However, Trump did not disclose the specific details of the agreement, and the White House has not yet released an official statement.On August 29th, NBC News, citing two sources familiar with the matter, reported that US Defense Secretary Peter Hegseth has been discussing the possibility of running for president in 2028 with close associates in recent months. Hegseth and his wife believe he shares some similarities with Trump, including a tough, confrontational style and conservative stances on social issues, which could garner support from the MAGA base. This month, Hegseth also traveled to Iowa to campaign for Republican lawmakers. Iowa has long been a key outpost in US presidential elections, further fueling speculation that he is preparing to run. If he does run, Hegseth could compete with Vice President JD Vance, Secretary of State Rubio, and others. However, a Pentagon spokesperson denied the claims, stating that "Secretary Hegseth will not run for president," and that his primary focus remains leading the Department of Defense. The report points out that the ongoing war with Iran could be a major political burden for Hegseth, with 18 US military personnel already killed and the average US gasoline price rising from less than $3 per gallon to slightly over $4.On August 29th, Allianz Chief Economic Advisor Mohamed El-Erian stated that todays changes in the US Treasury yield curve released two signals. The spread between the 2-year and 10-year yields narrowed by approximately 7 basis points, and the spread between the 2-year and 30-year yields narrowed by approximately 10 basis points, showing a flattening trend. El-Erian believes this reflects a dual interpretation in the fixed-income market: in the short term, it represents a hawkish repricing following Federal Reserve Chairman Warshs firm commitment to the inflation target; in the long term, it reflects recognition of the Federal Reserves long-term credibility.

Europe's Fertilizer Shortfall Boosts US Nitrogen Exports

Skylar Williams

Oct 26, 2022 14:19

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Due to rising European natural gas costs, U.S. nitrogen fertilizer exports reached a multi-year high this summer.


The Ukrainian conflict's worldwide food and energy supply impacts are shown by strong U.S. sales. Russia, which faces financial sanctions, produces fertilizer and natural gas, which are needed to make nitrogen-based products that boost corn and other crop yields.


Since Russia invaded Ukraine in February, Europe has weaned itself off Russian natural gas and shut down an ammonia pipeline to a Ukrainian port.


Due to a global fertilizer shortfall that has raised crop nutrient prices, the UN issued a "future availability crisis" alert this month. European fertilizer factories have closed due to high prices.


The world's third-largest fertilizer producer, the United States, exported 370,000 short tons in August, more than double the year-ago figure, according to the latest U.S. Census Bureau data compiled by industry organization The Fertilizer Institute (TFI) for Reuters. TFI began recording statistics in 2013.


According to London-based Argus Media CEO Alistair Wallace, European customers are outbidding domestic buyers in the US and other exporting nations like Indonesia and Malaysia.


Despite the export surge, TFI data shows that U.S. nitrogen fertilizer production was at its second-highest level in a decade in June, indicating a global dislocation rather than scarcity.


Jason Troendle, economist at TFI, which includes CF Industries (NYSE:CF) and Nutrien (NYSE:NTR), said it is unclear if the U.S. produced more or shifted more supplies to Europe in July and August (NYSE:NTR).


Troendle noted that the US exports little and cannot backfill markets.


Troendle said France, Belgium, Norway, Lithuania, Morocco, Chile, and Brazil had the biggest year-over-year U.S. purchase growth.


According to Wallace, European countries now buy urea, a nitrogen fertilizer, from outside.


He claimed EU nitrogen costs fell in mid-October as some European plants resumed output due to dropping natural gas prices.


According to Copa-Cogeca secretary-general Pekka Pesonen, European farmers cannot stockpile fertilizer before sowing next spring due to high prices and limited supply.


"We need tremendous volumes in a short time," Pesonen said.


Despite rising input prices, U.S. farmers may plant more fertilizer-intensive corn next year. Farm Futures polled growers and predicted a 10-year high of 94.282 million acres for corn acreage, up 6.4% from 2022.


Belmond, Iowa farmer Dave Nelson pays $1,280 per ton for fertilizer, up from $350 two years ago. For 2023 budgeting, he obtained this price this fall.


"I might as well do it because (price) would just climb," said maize and soybean farmer Nelson. Skimping on fertilizer will hurt you.


Investment bank Itau BBA reported that Brazil, which imports 85% of its fertilizer, bought more ammonium nitrate from the US, Belgium, and Holland in January–September to compensate for lower Russian supply.

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