Key facts
- Saudi phosphate producer Maaden will load a 60,000-tonne DAP cargo at Duqm, Oman, for shipment to India in late August or early September.
- An additional 55,000 tonnes of DAP sold to East Africa will also be loaded from Duqm in September.
- Maaden is transporting DAP via truck from its Ras Al-Khair facilities to Saudi Arabia's Red Sea coast.
- The shift to Omani ports is a response to increased risks in the Red Sea and around the Bab el-Mandeb strait.
- Freight costs from Duqm to India are estimated at $20s/t, compared to $40/t from Saudi Red Sea ports.
- Maaden has lowered its 2026 phosphate production guidance to 6-6.5 million tonnes of DAP.
Saudi phosphate producer Maaden is set to export a significant cargo of diammonium phosphate (DAP) from Duqm, Oman, to India, marking a strategic shift in its logistics amid heightened geopolitical risks in the Red Sea. The 60,000-tonne shipment, scheduled for late August or early September, is priced on a formula basis.
This move allows Maaden to bypass the Strait of Hormuz, which it previously used, and the increasingly perilous Red Sea route. Following the Strait of Hormuz's effective closure in February, Maaden had been trucking its product to Saudi Arabia's Red Sea coast, primarily Yanbu, for onward export. However, recent threats from Yemen's Houthi militants against Saudi shipping have amplified concerns around the Bab el-Mandeb strait, a critical chokepoint.
While the freight cost from Duqm to India is estimated to be lower ($20s/t) compared to shipments from Saudi Red Sea ports ($40/t), the operation faces challenges. Congestion at Omani ports is reportedly driving up demurrage rates, and war risk premiums remain a significant factor for regional shipments.
In addition to the India-bound cargo, Maaden will also load 55,000 tonnes of DAP from Duqm in September for buyers in East Africa, with netbacks expected between the mid-$890s/t and mid-$900s/t fob. These logistical adjustments come as Maaden has trimmed its 2026 phosphate production guidance to 6-6.5 million tonnes of DAP, citing sulphur shortages and high logistical costs.
It remains unclear if Saudi Arabia's other major phosphate producer, Sabic, will also adopt similar export strategies via Oman.