Urea Daily Review: Increased Transactions at the Lower Market Segment, Factory Quotations Undergo Minor Range Adjustments

Domestic Urea Price Index:

According to Feidoodoo data estimates, on March 26, the urea small particle price index stood at 2196.95, marking a decrease of 1.05 from the previous day, a 0.05% decline on a day-to-day basis, and a 20.95% decline year-on-year.

Urea Futures Market:

Today, the urea UR405 contract opened in 2010, reaching a high of 2045 and a low of 1999, with a settlement price of 2022 and a closing price of 2007. The closing price, compared to the previous trading day's settlement price, increased by 31, representing a 1.57% rise, with the day's fluctuations ranging from 1999 to 2045. The Shandong area basis for the 05 contracts was 123; the 05 contracts saw a reduction of 11,356 in open interest today, with the current open interest standing at 166,622.

Spot Market Analysis:

Today, the domestic urea market prices continued to decline, with an increase in low-end transactions in recent days. Some mainstream enterprises slightly raised their quotations after receiving orders, resulting in narrow price fluctuations.

Specifically, prices in the Northeast region fell to RMB 2200-2220/ton. Prices in the North China region rose to RMB 2000-2290/ton. Prices in the East China region rose to RMB 2120-2170/ton. Prices in the South China region rose to RMB 2230-2340/ton. Prices for small and medium particles in Central China rose to RMB 2130-2320/ton, while large particle prices rose to RMB 2180-2250/ton. Prices in the Northwest region fell to RMB 2140-2150/ton. Prices in the Southwest region fell to RMB 2100-2450/ton.

Factory Aspect:

Factory ex-factory prices continued to decrease, with some manufacturers seeing improved low-end transactions after price reductions, leading to a gradual increase in orders and a slight upward adjustment in quotations. However, high-price transactions remained sluggish, and factories adjusted prices cautiously. From the market perspective, operations were at a stalemate, with a strong sentiment of observation among operators, leading to a gradual stabilization of the situation. Recent market activities saw an increase in low-end transactions, but this was insufficient to support price movements, with the market showing weak performance in the short term. In terms of supply, many devices under maintenance have resumed operations, with daily production slightly increasing. The industry supply continued to operate high, with supply exceeding demand. On the demand side, downstream demand continued as before, with just-in-time small-scale restocking being the main activity, indicating weak performance.

Overall Analysis:

Currently, the urea market exhibits a weak supply-demand relationship, with no positive news to support high price levels. It is anticipated that in the short term, urea market prices will likely undergo minor adjustments within a stable range.