Urea Daily Review: Spring Order Pressure Becomes Apparent, Enterprise Quotations Continue to Explore Lower Prices

Domestic Urea Price Index:

According to Feidoodoo data calculations, on January 10th, the urea small granule price index was 2366.82, down 6.05 from yesterday, a 0.25% decrease day-on-day, and a 14.94% decrease year-on-year.

Urea Futures Market:

Today, the urea UR405 contract opened in 2055, with a high of 2089 and a low of 2052. The settlement price was 2069, and the closing price was 2069. The closing price increased by 7 from the previous trading day, down 0.34%, with a daily fluctuation range of 2052-2089. The Shandong region's basis for the 05 contract was 221. The 05 contract increased its positions by 2746 hands today, with a total of 163,200 hands held.

Spot Market Analysis:

Today, the domestic urea market prices continued their downward trend, with manufacturers facing increasing sales pressure. Currently, to secure a sufficient volume of new orders, prices are continuously being explored lower.

Specifically, prices in the Northeast region fell to 2370-2420 yuan/ton. Prices in the North China region dropped to 2110-2420 yuan/ton. Prices in the East China region decreased to 2260-2340 yuan/ton. Prices in the South China region fell to 2420-2470 yuan/ton. Prices for small and medium granules in the Central China region dropped to 2240-2450 yuan/ton, and large granules fell to 2400-2480 yuan/ton. Prices in the Northwest region remained stable at 2350-2360 yuan/ton. Prices in the Southwest region remained stable at 2300-2800 yuan/ton.

Market Forecast:

On the factory side, manufacturers are primarily dispatching previously pending orders, with a significant decrease in inventory and a small volume of new orders following. As the spring order season approaches, factories are flexibly adjusting prices, with market-high prices gradually converging towards the lower end, and current factory quotations continuing to decline. In the market, low-end prices continue to emerge, but the overall trading atmosphere remains bearish, with transactions maintaining a stagnant and tepid state. On the supply side, industry supply is affected by enterprise equipment malfunctions, limiting daily production increases. Some enterprises in Shanxi are gradually resuming operations, with gas-head units expected to resume in the middle and latter part of the month, gradually increasing the industry's capacity utilization rate from a low level. On the demand side, industrial and agricultural demand continues to be average, with localized demand slowly following, mainly with just-in-time small orders, and a strong wait-and-see sentiment still prevailing.

Overall, the current urea market is characterized by weak supply and demand, with prices in a stalemate. Most factories are preparing for spring orders, with quotations continuing to decline. It is expected that in the short term, urea market prices will continue to be mostly stable with minor decreases, facing difficulties in rising.