Urea Daily Review on August 7: Market Demand Weakens, Awaiting Indian Tender Results

Domestic Urea Price Index:

According to data from Fertilizer Duo Duo, the urea small granule price index on August 7 was 2467.86, a decrease of 32.27 from last Friday, down 1.29% from the previous week, and up 0.15% year-on-year.

Urea Futures Market:

The opening price of the urea UR2309 contract was 2232, with a high of 2249, a low of 2178, a settlement price of 2205, and a closing price of 2222. The closing price fell 68 compared to the settlement price of the previous trading day, down 2.97%. The daily fluctuation range was 2178-2249, with a price difference of 71. The 09 contract reduced its position by 24,927 lots today, with a current position of 251,663 lots.

Spot Market Analysis:

Today, domestic urea market prices generally fell. Earlier, urea prices had risen to a high level, resulting in strong resistance to high prices downstream. Coupled with the current weak domestic demand, the market is mainly characterized by weak fluctuations.

Specifically, prices in the Northeast region remained stable at 2230-2450 yuan/ton. Prices in North China fell to 2300-2480 yuan/ton. Prices in the Northwest region remained stable at 2510-2520 yuan/ton. Prices in the Southwest region remained stable at 2450-2700 yuan/ton. Prices in East China fell to 2360-2440 yuan/ton. In Central China, the price of small and medium granules fell to 2390-2700 yuan/ton, and large granules fell to 2510-2600 yuan/ton. Prices in South China remained stable at 2600-2700 yuan/ton.

Market Forecast:

On the supply side, it is expected that urea maintenance units will gradually resume operations this week, negatively impacting the supply side. On the demand side, agricultural demand is weakening, with industrial demand being the primary focus. Urea consumption is decreasing, and domestic fertilizer demand is not high. Internationally, the tender for imported urea announced by India has not yet been finalized, and there is still significant uncertainty. Most people are adopting a wait-and-see attitude. It is expected that the announcement of the Indian tender price this week will have a significant impact on the domestic market. In terms of futures, urea futures trading prices rose last Friday and returned to a downward trend today, which will subsequently lead to a synchronized adjustment of urea market prices.

In summary, with an increase in urea market supply and demand lower than supply, urea prices are expected to mainly show weak fluctuations. Meanwhile, the market is still awaiting the results of the Indian tender.