Urea Daily Review: Prices Continue to Rise, Market Follow-up Slows Down

Domestic Urea Price Index:

According to Feidoodoo Data calculations, on November 8th, the urea small particle price index was 2624.68, an increase of 5.00 from the previous day, up 0.19% month-on-month, and 1.68% year-on-year.

Urea Futures Market:

Today, the urea UR2401 contract opened at 2400, with a high of 2423, a low of 2364, a settlement price of 2391, and a closing price of 2396. The closing price fell by 52 compared to the settlement price of the previous trading day, down 2.12%, with a daily fluctuation range of 2364-2423; the 01 contract had a Shandong region basis of 194; the 01 contract reduced its positions by 13,044 hands today, with current holdings at 354,606 hands.

Spot Market Analysis:

Today, domestic urea prices continued their upward trend. With the recent continuous rise in prices, the market follow-up speed has begun to slow down gradually. Under the tight spot situation of manufacturers, today's ex-factory quotations did not show a downward trend.

Specifically, prices in the Northeast region remained stable at 2590-2680 yuan/ton. Prices in the North China region rose to 2430-2680 yuan/ton. Prices in the Northwest region rose to 2610-2620 yuan/ton. Prices in the Southwest region remained stable at 2550-2800 yuan/ton. Prices in the East China region rose to 2580-2630 yuan/ton. In the Central China region, the prices of small and medium particles remained stable at 2560-2730 yuan/ton, while the prices of large particles rose to 2680-2730 yuan/ton. Prices in the South China region rose to 2680-2770 yuan/ton.

Market Forecast:

On the supply side, daily production will continue to operate at high levels in the short term. This week, enterprise inventory has risen slightly, but with the current plant shutdowns and gradual shipments, enterprise inventory remains low, and the market spot supply is still tight. On the manufacturer's side, manufacturers have a large number of pre-received orders from earlier periods, and are currently dealing with pending shipments. Some mainstream regional factories have stopped receiving orders successively. Under the tight spot supply situation, manufacturers' quotations continue to rise, and the sentiment remains firm. In the market, the recent futures prices continue to rise, and the board prices continue to pull up. Driven by sentiment, the market's new order transactions have increased, and the transaction focus has moved up, with the current market atmosphere improving. On the demand side, the follow-up in the domestic urea market is still slightly slow, and the industrial demand market mostly purchases as needed. The demand for urea from compound fertilizer factories in the Northeast has increased, while the agricultural demand market is still in the off-season, with a small number of dealers restocking at low prices. Under the influence of high prices, most dealers' reserve demand has slowed down.

In summary, with manufacturers still having pending shipments and inventory continuing at low levels, the market sentiment continues to support prices, and it is expected that urea market prices will continue to fluctuate at high levels in the short term.