Urea Daily Review: Better Acceptance of Lower Prices Amid Current Tight Spot Supply

Domestic Urea Price Index:

According to Feidoodoo data calculations, the urea small granule price index on January 30th was 2259.77, an increase of 12.91 from the previous day, a month-on-month increase of 0.57%, and a year-on-year decrease of 19.66%.

Urea Futures Market:

Today, the urea UR405 contract opened at 2137, with a high of 2153, a low of 2100, a settlement price of 2131, and a closing price of 2115. The closing price decreased by 26 compared to the previous trading day's settlement price, a month-on-month decrease of 1.21%, with the day's fluctuation range between 2100-2153. The Shandong region's basis for the 05 contract is 75. The 05 contracts decreased by 6825 hands today, with current holdings at 177,100 hands.

Spot Market Analysis:

Today, the domestic urea market prices continued to adjust slightly upwards, with an increase in new orders for enterprises, a tight supply of goods, and a slight rise in low-end quotations.

Specifically, prices in the Northeast region rose to 2190-2270 yuan/ton. In the North China region, prices rose to 2070-2280 yuan/ton. In the East China region, prices rose to 2190-2240 yuan/ton. In the South China region, prices rose to 2350-2400 yuan/ton. In the Central China region, small and medium granule prices rose to 2200-2380 yuan/ton, while large granule prices remained stable at 2250-2300 yuan/ton. Prices in the Northwest region rose to 2210-2220 yuan/ton. Prices in the Southwest region remained stable at 2200-2600 yuan/ton.

Future Forecast:

From the factory side, the market transaction atmosphere has improved recently, with better acceptance of new orders for enterprises, and quotations generally slightly adjusting upwards. Some enterprises have not yet fully received Spring Festival orders and continue to accept orders at lower prices, with stable quotations. The current market low-end prices are gradually approaching the high-end, and it is expected that the short-term market prices still have an upward trend, but the overall increase space is limited. From the market perspective, the market situation is stable and upward, with an overall weak and stable transaction atmosphere, and downstream is mostly cautiously waiting and watching to follow up at lower prices. On the supply side, companies undergoing maintenance continue to resume gradually, increasing the supply volume, and enterprises have better acceptance of orders, leading to short-term tightness in spot goods, and tight market supply. On the demand side, downstream operators follow up appropriately. As the end of the year approaches, more downstream factories gradually shut down, compound fertilizer factories reduce operations, and agriculture appropriately restocks, leading to weak demand operations.

Overall, the current urea market has better order acceptance, and although supply is gradually increasing, the current market spot supply is tight, supported by bullish factors. It is expected that the urea market prices will remain mostly stable with slight