Urea Daily Review: Manufacturer Morale Boosts, Prices Firmly Rise

Domestic Urea Price Index:

According to the calculations by Feidoodoo, on November 6th, the urea small granule price index was 2591.50, an increase of 19.55 from last Friday, a week-on-week increase of 0.76%, and a year-on-year increase of 1.87%.

Urea Futures Market:

Today's urea UR2401 contract opening price: 2372, highest price: 2435, lowest price: 2357, settlement price: 2398, closing price: 2420, the closing price rose by 27 compared to the last trading day's settlement price, a week-on-week increase of 1.13%, with the daily fluctuation range of 2357-2435; the 01 contract's Shandong area basis was 140; the 01 contract saw an increase in positions by 21743 hands today, with a current total of 388968 positions.

Spot Market Analysis:

Today, domestic urea prices continued to be firm and rose, with an increase ranging from 10 to 60 yuan/ton. After several days of continuous price rises, factories received a large number of orders, and the current main stance is to maintain prices.

Specifically, prices in the Northeast region rose to 2590-2650 yuan/ton. Prices in the North China region rose to 2410-2630 yuan/ton. Prices in the Northwest region rose to 2570-2580 yuan/ton. Prices in the Southwest region remained stable at 2480-2800 yuan/ton. Prices in the East China region rose to 2550-2590 yuan/ton. In the Central China region, the price for small and medium granules rose to 2540-2680 yuan/ton, and the price for large granules remained stable at 2550-2680 yuan/ton. Prices in the South China region rose to 2620-2740 yuan/ton.

Market Forecast:

On the supply side, the daily production of urea is still at a high level. In the later stage, gas-head enterprises will enter the maintenance period one after another, and it is expected that the urea production capacity utilization rate will fall, and the supply will decrease accordingly. For manufacturers, factories have received a large number of orders earlier, and some manufacturers have started to limit orders after filling up their orders, and the pre-received orders support a strong price mentality. On the market side, the market is boosted by international news such as the conflict between Palestine and Israel, the India-Pakistan conflict, and the reduction of urea production in Egypt, which has led to a strong rise in urea futures, and sentiment has once again pulled domestic demand to follow up, with mainstream regional market quotes being firm. On the demand side, the current spot prices are high, and the downstream storage willingness is low, and winter storage has not been launched on a large scale. As far as the current market storage demand is concerned, the time for light storage is quite scattered, and most follow up slowly.

In summary, manufacturers are supported by orders, market sentiment is mostly boosted, and considering the expected reduction in supply in the future, it is predicted that the urea market prices will fluctuate and consolidate in the short term.