Recent price trends of urea

According to the Commodity Analysis System of Business Society, the domestic urea market price has slightly decreased this week, with urea prices dropping from 2584.29 yuan/ton at the beginning of the week to 2577.14 yuan/ton at the end of the week, a decrease of 0.28%. Weekend prices increased by 9.76% year-on-year. On August 13th, the urea commodity index was 119.87, unchanged from yesterday, a decrease of 21.31% from the cycle’s highest point of 152.33 points (2022-05-15), and an increase of 115.59% from the lowest point of 55.60 points on August 17th, 2016. (Note: The cycle refers to the period from September 1st, 2011 to the present)

Cost support is average, downstream demand weakens, and urea supply is sufficient

From the supply side perspective, the mainstream prices of urea in China have fluctuated this week.

From the data of the upstream and downstream industry chains, it can be seen that there have been ups and downs in the urea upstream market this week. The price of liquefied natural gas fluctuated and rose, rising from 3630.00 yuan/ton at the beginning of the week to 3640.00 yuan/ton at the weekend, an increase of 0.28%. The weekend price fell by 47.97% year-on-year; The price of anthracite has stabilized at a low level, with the price of Yangquan anthracite (washing medium block) at 1130 yuan/ton this week; The price of liquid ammonia slightly decreased, dropping from 3383.33 yuan/ton at the beginning of the week to 3366.67 yuan/ton at the weekend, a decrease of 0.49%. The weekend price fell by 11.33% year-on-year. Upstream raw material prices fluctuate, and there is insufficient support for urea prices. This week, the downstream melamine price of urea has stabilized at a low level, with a price of 7075.00 yuan/ton.

From a demand perspective: Agricultural demand has weakened, while industrial demand is average. The use of fertilizers in summer has basically ended, with sporadic fertilizer supplementation being the main focus, and agricultural demand has weakened. The operating rate of the compound fertilizer plant is average, and the enthusiasm for urea procurement is normal. Board and melamine enterprises are operating at a low level, with a focus on purchasing on demand. From a supply perspective, the daily production of urea is around 160000-170000 tons, indicating sufficient supply.

Small fluctuation and decline in the future market

In mid to late August, the domestic urea market may experience a slight fluctuation and decline. Business Society urea analysts believe that the upstream market of urea has ups and downs, and the cost of urea is generally supported. Downstream agricultural demand has basically ended, while industrial demand is average. The daily production of urea is around 160000-170000 tons, with sufficient supply. In the future, urea may experience a narrow range of fluctuations and decline.