Urea Daily Review: Strong Market Resistance, Enterprises Lower Their Quotations

Domestic Urea Price Index:

According to the data calculated by Feidoodoo, on September 7th, the urea small granule price index was 2605.14, a decrease of 10 from the previous day, a decrease of 0.38% month-on-month, and an increase of 3.53% year-on-year.

Urea Futures Market:

Today, the opening price of the urea UR2401 contract was 2207, with a high of 2207, a low of 2064, a settlement price of 2121, and a closing price of 2094. The closing price fell 118 compared to the settlement price of the previous trading day, a decrease of 5.33%. The daily fluctuation range was 2064-2207, with a price difference of 143. The 01 contract increased by 15136 hands today, with a current position of 341244 hands.

Spot Market Analysis:

Today, the domestic urea market price fell slightly, with most enterprises slightly lowering their quotations, some enterprises' quotations remained stable, and the overall volume of new orders decreased.

Specifically, the price in the Northeast region remained stable at 2500-2560 yuan/ton. The price in the North China region fell to 2410-2600 yuan/ton. The price in the Northwest region remained stable at 2580-2590 yuan/ton. The price in the Southwest region remained stable at 2480-2800 yuan/ton. The price in the East China region fell to 2630-2680 yuan/ton. The price of small granules in the Central China region fell to 2510-2730 yuan/ton, while the price of large granules remained stable at 2620-2640 yuan/ton. The price in the South China region fell to 2620-2730 yuan/ton.

Market Forecast:

On the enterprise side, companies are still continuing to execute domestic and export orders, with inventory remaining low. Due to equipment maintenance, daily production has relatively decreased, resulting in tight spot supply and little change in the supply side. On the downstream side, there is still a demand for compound fertilizer. Due to the rise in raw material prices, the downstream procurement cycle has been shortened, and the cost of dealers has increased, forcing them to purchase in small quantities as needed. In terms of market sentiment, affected by the recent deviation of urea market prices from the supply and demand fundamentals, there are currently calls from associations for rational operation and to avoid speculative operations. In recent days, several enterprises have issued supply guarantee proposals, mentioning prioritizing domestic demand, reducing exports, etc., ensuring that there will be no market out-of-stock situations.

Overall, due to the current high prices, there is strong market resistance. It is expected that the spot price of urea will gradually fall in the short term, but due to the low supply, the price decline will be limited.