Daily Review of Urea: Slowdown in Agricultural Demand Follow-up, Prices Mainly Under Weak Adjustment

Domestic Urea Price Index:

According to Feidoodoo data estimates, on February 20th, the small particle urea price index was 2333.45, an increase of 4.36 from the previous day, a 0.19% rise month-on-month, and a 15.75% decrease year-on-year.

Urea Futures Market:

Today, the opening price for the UR405 urea contract was 2170, with a high of 2170, a low of 2124, a settlement price of 2142, and a closing price of 2142. The closing price decreased by 47 compared to the previous trading day's settlement price, marking a 2.15% drop, with a daily fluctuation range of 2124-2170. The basis in the Shandong area for the May contract was 158; today, the May contract saw an increase in positions by 14614, reaching a total of 188,900 hands.

Spot Market Analysis:

Today, the domestic urea market prices showed a slight upward adjustment, with most manufacturers' quotations remaining stable, and demand follow-up weakening, indicating signs of market loosening and price adjustments.

Specifically, prices in the Northeast region rose to 2290-2370 yuan/ton. In the North China, prices fell to 2160-2340 yuan/ton. Prices in the East China region remained stable at 2270-2330 yuan/ton. In the South China, prices rose to 2380-2480 yuan/ton. In the Central China, small and medium particle prices fell to 2250-2380 yuan/ton, while large particle prices remained stable at 2310-2400 yuan/ton. Prices in the Northwest region rose to 2320-2330 yuan/ton. The Southwest region's prices increased to 2300-2600 yuan/ton.

Market Forecast:

From the factory side, manufacturers are receiving good orders, and with the support of pending orders, there is no pressure on shipments, maintaining a relatively firm mentality overall. On the market side, influenced by recent weather conditions and continuous price increases, business transactions have slowed down, and the current market price trend has weakened under the influence of market sentiment. In terms of supply, the industry currently has few plant failures and maintenance, and daily production is gradually increasing, ensuring continued ample spot market supply. Regarding demand, the current decline in agricultural shipments has slowed down compared to the previous two days; industrial demand follow-up is still slowly recovering, leading to a bearish demand side and suppressing price increases.

In summary, with the weakening of agricultural demand follow-up and the slow recovery of industrial demand, market demand is weakening. Coupled with the bearish influence of ample supply, it is expected that the urea market prices will primarily undergo weak adjustments in the short term.