Urea Daily Review: Factory Shipments Support, Downstream Demand Lackluster, Market Atmosphere Stagnant

Domestic Urea Price Index:
According to Feidoodoo data, on October 18th, the urea small granule price index was 2469.23, up by 0.77 from yesterday, a 0.03% increase from the previous period, and a year-on-year decrease of 4.12%.

Urea Futures Market:
Today's urea UR2401 contract opened at 2120, with a high of 2179, a low of 2109, a settlement price of 2144, and a closing price of 2174. The closing price increased by 60 compared to the settlement price of the previous trading day, up by 2.84%. The fluctuation range for the day was 2109-2179, with a price difference of 70. The 01 contract increased its position by 31,251 hands today, with a current holding of 353,760 hands.

Spot Market Analysis:
Today, the domestic urea market price rose slightly. Most manufacturers' quotations are relatively stable, with a few factories adjusting their ex-factory prices upward. The urea market price is overall in a consolidation phase.

Specifically, the price in the Northeast region was adjusted to 2440-2490 yuan/ton. The North China region price was adjusted downward to 2250-2490 yuan/ton. The Northwest region price remains stable at 2410-2420 yuan/ton. The Southwest region price is stable at 2380-2800 yuan/ton. The East China region price remains stable at 2360-2440 yuan/ton. In the Central China region, the price of small granules is stable at 2380-2620 yuan/ton, while the large granules price was adjusted upward to 2530-2560 yuan/ton. The South China region price remains stable at 2520-2600 yuan/ton.

Market Forecast:
In terms of supply, the urea market supply remains high, with abundant goods available at the current stage. Regarding manufacturers, the quotations of urea manufacturers increased this week. Affected by the significant price increase, the market transactions have slowed down. However, many manufacturers have accumulated a certain number of pending orders, with no pressure on short-term shipments and a generally bullish attitude. In terms of corporate inventory, the total inventory of urea companies has decreased by about 10% compared to last week. Due to the good order intake previously, the inventory has decreased, and there's currently no significant pressure on factory stock. On the demand side, downstream is showing resistance to high prices. Currently, apart from the autumn farming needs, there are no other demands, temporarily affecting the demand side negatively. Regarding the market, the current Shanxi production restrictions and labeling news continue to provide support, both contributing to the firm operation of urea prices.

In summary, the urea market is currently in a state of manufacturer rivalry. With the support of pending shipments and labeling news, combined with the sluggish demand from downstream traders, it is expected that the urea market price will remain steady in the short term.