Urea Daily Review: Market Demand Weakens, Urea Prices Generally Stable with Slight Declines

Domestic Urea Price Index:

According to Fdata, on November 30th, the small particle urea price index was 2523.77, down 4.09 from yesterday, a 0.16% decrease from the previous day, and a 10.11% decrease year-over-year.

Urea Futures Market:

Today, the urea UR2401 contract opened at 2290, with a high of 2314, a low of 2266, a settlement price of 2288, and a closing price of 2308. The closing price fell by 1 compared to the previous trading day's settlement price, a 0.04% decrease. The daily fluctuation range was 2266-2314; the Shandong area basis difference for the 01 contract was 142; the 01 contract reduced 10207 positions today, with current holdings at 172979.

Spot Market Analysis:

Today, domestic urea prices were slightly adjusted downwards, with companies in various regions making small adjustments but generally maintaining stability.

Specifically, prices in the Northeast region were stable at 2510-2550 RMB/ton. In North China, prices were stable at 2340-2560 RMB/ton. In the Northwest region, prices were stable at 2470-2480 RMB/ton. In the Southwest region, prices were stable at 2480-2800 RMB/ton. In East China, prices were stable at 2440-2490 RMB/ton. In Central China, small particle prices were stable at 2440-2650 RMB/ton, and large particle prices at 2580-2660 RMB/ton. In South China, prices fell to 2620-2660 RMB/ton.

Market Forecast:

From the factory perspective, most factories, supported by prior pending orders, currently maintain steady and firm prices, with new orders significantly reduced compared to the last two days. Additionally, despite having pending orders, the market flow has decreased, and some enterprises are experiencing a slight inventory buildup, expecting a gradual increase in corporate inventory in the short term. On the supply side, current enterprise operating rates and production maintain high levels. Entering December, increasing numbers of device maintenance and reduced production from gas-head devices are anticipated, potentially improving market expectations under positive stimuli. In terms of demand, urea is still in the off-season, with the market mostly purchasing on dips and steady progression in essential demand. Following the recent restocking, agricultural market demand is minimal, but industrial demand persists, with downstream industries purchasing on dips and maintaining a watchful attitude, leading to a slowdown in overall reserve demand.

In summary, current urea market demand is low, with the market restocking on dips and supply guaranteed. It is expected that the urea market prices will continue to be generally stable with slight declines in the short term.