Urea Daily Review: Weak Market Operation, Price Fluctuations in Consolidation

Domestic Urea Price Index:

According to Feidoodoo data calculations, on January 25, the urea small granules price index was 2233.00, a decrease of 4.55 from the previous day, down 0.20% day-on-day, and a 20.04% decrease year-on-year.

Urea Futures Market:

Today, the urea UR405 contract opened in 2075, with a high of 2115, a low of 2070, a settlement price of 2089, and a closing price of 2100. The closing price increased by 66 compared to the previous trading day, up 3.24%, fluctuating between 2070 and 2115 throughout the day. The 05 contract's basis in the Shandong area was 30. The 05 contract saw an increase of 3,525 hands in positions today, reaching a total of 204,600 hands held.

Spot Market Analysis:

Today, the domestic urea market prices continued to decline, with manufacturers' quotes undergoing narrow-range fluctuations. Some enterprises had good sales of low-priced supplies, slightly enhancing market activity.

Specifically, prices in the Northeast region remained stable at 2190-2250 RMB/ton. In North China, prices rose to 2040-2260 RMB/ton. In East China, prices fell to 2120-2200 RMB/ton. In South China, prices rose to 2330-2400 RMB/ton. In Central China, small and medium granule prices rose to 2140-2380 RMB/ton, and large granule prices remained stable at 2180-2250 RMB/ton. In Northwest China, prices fell to 2140-2150 RMB/ton. In Southwest China, prices fell to 2225-2600 RMB/ton.

Market Forecast:

On the factory side, recently, some regional factories have seen good reception of lower-end quotes. Currently, they continue to attract orders at low prices. As the Spring Festival holiday approaches, most factories have pre-sale plans, with factory quotes continuing to decrease, but transactions remain average. In the market, the operation remains weakly stable, with a relatively weak overall trading atmosphere and downstream cautiously following up. On the supply side, as enterprises that were under maintenance resume operations, daily production is gradually rising, leading to ample market supply and pressure on price increases. On the demand side, traders, based on the continuous price decline and mostly for reserve needs, are cautiously following up with just-in-time and sporadic purchases, maintaining a strategy of following up on lower prices.

Overall, the current urea market prices continue to explore lower levels, with limited demand from traders and a cautious purchasing approach. It is expected that urea market prices will continue to undergo weak consolidation in the short term.