Urea Daily Review: Reduced Pending Orders Support Firm Market Trend

Domestic Urea Price Index:

According to Feidoodoo Index data, on December 12, the small particle urea price index was 2516.50, a decrease of 6.36 from the previous day, down 0.25% week-on-week, and down 10.04% year-on-year.

Urea Futures Market:

Today, the urea UR405 contract opened at 2242, with a high of 2300 and a low of 2240. The settlement price was 2279, and the closing price was 2299, up 51 from the previous day's settlement price, an increase of 2.27%. The day's fluctuation range was 2240-2300; the 05 contract had a basis of 151 in the Shandong area; the 05 contract increased positions by 16605 hands, with total positions now at 141,600 hands.

Spot Market Analysis:

Today, domestic urea prices were stagnant and slightly declining, with most enterprise quotations remaining stable. The market transaction prices were mostly at lower levels, and the market trend was firm.

Specifically, prices in the Northeast region remained stable at 2500-2530 yuan/ton. In North China, prices dropped to 2330-2540 yuan/ton. In the Northwest, prices fell to 2460-2470 yuan/ton. In the Southwest, prices remained stable at 2480-2800 yuan/ton. In East China, prices were stable at 2450-2500 yuan/ton. In Central China, small and medium particle prices remained stable at 2450-2650 yuan/ton, while large particle prices were stable at 2580-2660 yuan/ton. In South China, prices dropped to 2590-2640 yuan/ton.

Market Forecast:

From the factory perspective, prices remained stable under the support of pending orders. In some mainstream regions, factories are processing pending orders, gradually reducing the volume of pending orders, leading to a slight loosening of prices. Currently, enterprises are cautious in price adjustments due to market news influences, with pressure on price increases. Market-wise, bearish market influences make price increases difficult. Regarding inventory, recent weather conditions have hindered transportation, limiting shipment from factories in the north and increasing inventory levels. On the supply side, although market supply is reducing, it remains relatively sufficient for current market demand. Short-term supply is expected to continue its downward trend, with daily production gradually decreasing. Demand-wise, the current market demand is mostly for small, stage-wise purchases, with agricultural needs focused on reserves and sporadic market transactions. Industrial demand from compound fertilizer enterprises remains high, with good demand and essential low-price follow-ups.

In summary, with reduced pending orders at urea enterprises and limited downstream demand, overall market changes are minor. It is expected that in the short term, urea market prices will continue to stabilize and undergo minor adjustments.