Urea Daily Review: Slow Increase in Daily Production, Prices Rise Again

Domestic Urea Price Index:

According to Feidoodoo calculations, on September 18th, the urea small granule price index was 2614.68, an increase of 8.64 from last Friday, up 0.33% from the previous week, and up 1.52% year-on-year.

Urea Futures Market:

Today's urea UR2401 contract opened at 2251, with a high of 2286, a low of 2236, a settlement price of 2269, and a closing price of 2270. Compared to the settlement price of the previous trading day, it rose by 42, up 1.89%. The daily fluctuation range was 2236-2286, with a price difference of 50. The 01 contract increased its holdings by 3080 hands today, with a current position of 331572 hands.

Spot Market Analysis:

Today, the domestic urea market price continued its strong trend, with some enterprises slightly increasing their factory quotations.

Specifically, prices in the Northeast region remained stable at 2500-2560 yuan/ton. Prices in the North China region rose to 2480-2670 yuan/ton. Prices in the Northwest region rose to 2560-2570 yuan/ton. Prices in the Southwest region remained stable at 2450-2800 yuan/ton. Prices in the East China region rose to 2640-2700 yuan/ton. In the Central China region, the price of small granules rose to 2560-2730 yuan/ton, and the price of large granules rose to 2620-2630 yuan/ton. Prices in the South China region fell to 2620-2740 yuan/ton.

Market Forecast:

In terms of supply, the current daily production increase of enterprises is slow, inventory is at a low level, some enterprises still have pending orders, and new orders are still decent. The overall market supply is tight, which is favorable for price increases. Additionally, this week, Shanxi's autumn and winter air pollution industrial production restriction plan has been approved and will be announced soon. The future focus will be on the intensity of the restrictions. In terms of demand, the start-up rate of compound fertilizer downstream this year has surged, increasing the demand for urea. Some enterprises have announced the postponement of the national fertilizer off-season commercial reserve market entry time, which may reduce demand at this stage.

In summary, the current market supply is at a low level, daily production is slowly increasing, and market demand still exists. Therefore, it is expected that the short-term urea spot price will mainly be stable with minor adjustments.