Urea Daily Review: Insufficient Effective Market Support, Prices Fluctuate

Domestic Urea Price Index:

According to Feidoodoo data, on November 21st, the price index for small particle urea was 2540.00, a decrease of 14.68 from the previous day, down 0.57% month-on-month, and 6.52% year-on-year.

Urea Futures Market:

Today, the opening price for the urea UR2401 contract was 2291, with a high of 2323 and a low of 2264. The settlement price was 2298, and the closing price was 2301. The closing price rose 25 from the settlement price of the previous trading day, up 1.10% month-on-month, with a daily fluctuation range of 2264-2323. The price difference in the Shandong area for the 01 contract was 129. The 01 contract saw an increase of 1434 hands today, with a current holding of 256988 hands.

Spot Market Analysis:

Today, domestic urea prices showed regional increases, with price adjustments in different areas. The market saw a slight increase in demand due to earlier low prices, with good inquiries and an increase in low-end transactions, leading to firms holding their prices.

Specifically, prices in the Northeast region fell to 2540-2590 yuan/ton. In North China, prices fell to 2330-2600 yuan/ton. Northwest prices fell to 2480-2490 yuan/ton. Southwest prices remained stable at 2550-2800 yuan/ton. East China prices rose to 2410-2470 yuan/ton. In Central China, prices for small and medium particles fell to 2420-2640 yuan/ton, while large particles fell to 2560-2660 yuan/ton. In South China, prices fell to 2630-2690 yuan/ton.

Market Forecast:

From the business perspective, manufacturers, supported by pending orders, have a strong will to hold prices, but due to sluggish market transactions, they adjust their factory prices according to their own levels, resulting in regional market price variations. In terms of supply, although some units are temporarily shut down for maintenance, the overall operation rate remains high. With more companies expected to shut down later, the operation rate is expected to decrease, and the specific situation will depend on the shutdown status of businesses. On the market front, supported by policies to ensure supply and stabilize prices, the overall price increase is expected to be limited. In terms of demand, it is currently the off-season for agricultural needs, with the market mainly focusing on reserves. Most traders replenish at low prices, with some areas having good market deliveries, leading to dispersed reserve demands. In terms of industrial demand, the need for compound fertilizers has increased, with new orders for winter reserve fertilizers gradually coming in, and previous orders are being shipped, which supports the demand for urea and influences prices.

In summary, the short-term market is running stably, lacking effective positive support, making it difficult for prices to continue rising. It is expected that urea market prices will undergo weak consolidation in the short term.