Natural Gas Plunge

[bucket]

farming, great call . . . natural gas slumped right to your targeted support.

Major support now $3.30/MMBTU? That would represent a near 50% washout from recent fall gas highs.

Does this mean they are making nitrogen fertilizer again at reduced input prices or are they using european natgas prices to price fertilizer?

[errolanderson]

Prices for Natural Gas in North America have certainly moderated, not so much in Europe. Oil edging back up today.

maybe the blizzard in Hawaii will stimulate gas prices? . . . .

[farming101]

farming, great call . . . natural gas slumped right to your targeted support.

Major support now $3.30/MMBTU? That would represent a near 50% washout from recent fall gas highs.

I doubt end of day prices will meet or beat 3.30 to the downside, maybe intraday
There is a lot of winter to go. Withdrawals have started
The capacity to export LNG from the US has grown exponentially. There will be a big incentive to load a few more ships for export
Maybe by Feb with a warm winter
I could be wrong

[bucket]

I doubt end of day prices will meet or beat 3.30 to the downside, maybe intraday
There is a lot of winter to go. Withdrawals have started
The capacity to export LNG from the US has grown exponentially. There will be a big incentive to load a few more ships for export
Maybe by Feb with a warm winter
I could be wrong

Can you comment on the lost opportunity Canada has experienced by not pushing LNG projects forward?

[wheatking16]

Natural gas is below the 200 DMA.

The next level of interest is 3.20 and will likely slow down or bottom in the 3.08-3.20 range.

[errolanderson]

I doubt end of day prices will meet or beat 3.30 to the downside, maybe intraday
There is a lot of winter to go. Withdrawals have started
The capacity to export LNG from the US has grown exponentially. There will be a big incentive to load a few more ships for export
Maybe by Feb with a warm winter
I could be wrong

This sell-off may be an opportunity for hedgers to purchase Feb/Mar nat gas calls. Feb at-the-money $3.65 calls trading for 0.39 today or $3,900 U.S. per contract for massive ten million BTU gas contract.

[farming101]

2021 numbers are only to September


In 2022 the US will have the largest LNG export capacity in the world.
Canada ships virtually all its NG to the US
This arrangement will likely continue

[shtferbrains]

This sell-off may be an opportunity for hedgers to purchase Feb/Mar nat gas calls. Feb at-the-money $3.65 calls trading for 0.39 today or $3,900 U.S. per contract for massive ten million BTU gas contract.

Yer grandma buys gas from Sask Energy for $3.20gj + del + $23.00 monthly fee.

Fertilizer producers are not buying gas an a daily price. They are hedged out at least a year or have long term contracts from producers.

Again, it takes about 35gj's to produce a ton of ammonia. Probably cost more for delivery from the plant to your field than thier gas costs no mater what price you put in for cost per GJ.

[AlbertaFarmer5]

Does this mean they are making nitrogen fertilizer again at reduced input prices or are they using european natgas prices to price fertilizer?

It means they are selling fertilizer at world prices to world markets in places where supply is extremely short due to shut Downs, and that we have to bid accordingly to keep enough supply here for our own needs.

[Hamloc]

It means they are selling fertilizer at world prices to world markets in places where supply is extremely short due to shut Downs, and that we have to bid accordingly to keep enough supply here for our own needs.

I was just reading on Farm Futures this morning that Yara is starting all of it’s European Ammonia plants due to the fact that the price of Ammonia on world markets has risen high enough to make it profitable again. Out of interest I took a look at the natural gas price in the U.K. this morning. It is at 320 pence a British therm, up from 228 pence just 9 days ago. That is a 40% increase and equivalent to $240 for a barrel of oil.

[shtferbrains]

Yara share price is going the wrong way. Time to make some cash.

Behind all of the noise you have to remember the top exec of all these companies including big pharma get bonuses based on how they drive share prices. They will push profits for the next cheque. What the long term consequences are doesn't seem a big deal as most don't stay long.

[errolanderson]

AECO storage hub nat gas price moving up on these cold temps.

Suffield spot bottomed @ $3.35 per gigajoule two weeks ago. Now the spot gas appears ranging $4 to $4.10 per gig.

New York gas futures still struggling with the Feb contract hovering around $3.70/MMBTU. Nat gas futures have collapsed 30 to 35 percent over the past month. Surprised futures remain so doggy considering time of year.

Seasonally, there should be a January gas price recovery . . . .

[Hamloc]

I was just reading on Farm Futures this morning that Yara is starting all of it’s European Ammonia plants due to the fact that the price of Ammonia on world markets has risen high enough to make it profitable again. Out of interest I took a look at the natural gas price in the U.K. this morning. It is at 320 pence a British therm, up from 228 pence just 9 days ago. That is a 40% increase and equivalent to $240 for a barrel of oil.

This morning U.K. natural gas price is trading at 455 pence per therm, almost doubled now since early December. From what I read this morning in countries in the EU like Germany electricity is hitting record prices as well.

It looks to me like Putin is playing with the European leaders like puppets on a string. Their poor choices in energy infrastructure have put him in the drivers seat.

[shtferbrains]

14 times current USA price for natural gas.

Wonder if those proposed LNG plants on northern BC coast look to have better economics now?

Diesel plants are a low cost producer. Set up your own gen set.

Have to wonder what we will see play out in the food vs fuel situation.

Reset for sure. Not very well planned.

[farming101]

This sell-off may be an opportunity for hedgers to purchase Feb/Mar nat gas calls. Feb at-the-money $3.65 calls trading for 0.39 today or $3,900 U.S. per contract for massive ten million BTU gas contract.

That was a good call Errol
Feb 3.65 calls up 59.2% less fees as of yesterday. Should be up some more today.
14 days to expiry .8457 delta