Urea Daily Review: Low Inventory Levels Provide Support, Prices Remain Strong

Domestic Urea Price Index:
According to Feidoodoo data, the urea small granule price index was 2475.59 on October 19, an increase of 6.36 from yesterday, up 0.26% month-on-month, and down 3.59% year-on-year.

Urea Futures Market:
Today's urea UR2401 contract opened at 2165, with a high of 2306, a low of 2165, a settlement price of 2255, and a closing price of 2280. The closing price rose 136 compared to the previous trading day’s settlement price, up 6.34% for the day, with a full-day fluctuation range of 2165-2306, a price difference of 141. The 01 contract increased its position by 21,993 today, with a current holding of 375,740.

Spot Market Analysis:
Today, the domestic urea market price continued to adjust upward, supported by pending orders and upcoming tender openings. The overall atmosphere is good, with some companies limiting orders. The futures price increased significantly, followed by the spot price.

Regional Price Overview:
The price in the Northeast region is stable at 2440-2490 yuan/ton. In the North China region, the price has been adjusted to 2380-2490 yuan/ton. The price in the Northwest region is stable at 2410-2420 yuan/ton. The price in the Southwest region is stable at 2380-2800 yuan/ton. The price in the East China region has been adjusted to 2370-2440 yuan/ton. In Central China, the price for small granules has been adjusted to 2390-2620 yuan/ton, while the price for large granules is stable at 2530-2560 yuan/ton. The price in the South China region has been adjusted to 2540-2600 yuan/ton.

Market Forecast:
On the supply side, due to environmental restrictions in Shanxi factories, there is a slight tension in the supply of large urea granules. Manufacturers still have supporting pending orders, and the current low inventory levels jointly maintain strong price performance. On the demand side, winter storage still exists in the Northeast market, but due to the current high prices and high supply, overall purchasing sentiment is cautious. With the arrival of the tender, downstream traders are mostly watching.