Daily review of urea: Short-term supply tightening and spot continues to rise (July 13)

China Urea Price Index:

According to Feiduo data, the urea small pellet price index on July 13 was 2,413.64, up 23.64 from yesterday, up 0.99% month-on-month, and down 8.26% year-on-year.

Urea futures market:

The price of urea UR2309 contract fell first and then rose today. The price fell immediately after the opening of early trading, falling to the lowest intraday point of 2035 and then rebounded. The futures price pulled up to 2086 and then fluctuated. After a narrow decline in the afternoon, the futures price saw a narrow upward trend, closing at 2079 in the late session. The opening price of the Urea UR2309 contract: 2070, the highest price: 2086, the lowest price: 2035, the settlement price: 2063, the closing price: 2079. The closing price increased by 30% compared with the settlement price of the previous trading day, and the month-on-month increase by 1.46%. The daily fluctuation range is 2035-2086, and the spread is 51; The 09 contract has reduced its position by 19987 lots today, and has held 367605 lots so far.

Spot market analysis:

Today, China's urea spot market prices continued to rise, growing happily, and market transactions were stable. Although downstream traders and terminals were afraid of heights at noon, urea companies had more orders to issue, supply was tight, and sales pressure was not great. Currently, the spot market is dominated by positive benefits, and there is still room for transactions to move upwards. Specifically, prices in Northeast China have stabilized at 2,120 - 2,200 yuan/ton. Prices in North China rose to 2,210 - 2,400 yuan/ton. Prices in the northwest region rose to 2,450 - 2,460 yuan/ton. Prices in Southwest China are stable at 2,300 - 3,000 yuan/ton. Prices in East China rose to 2,360 - 2,440 yuan/ton. The price of small and medium-sized particles in Central China rose to 2,380 - 2,500 yuan/ton, and the price of large particles rose to 2,260 - 2,360 yuan/ton. Prices in South China rose to 2,550 - 2,680 yuan/ton.

Market outlook forecast:

From the perspective of futures, futures prices continued to rise slightly today. The two markets continued to grow in the same direction. Futures have an emotional positive effect on the rise in spot prices. Fundamentally speaking, the demand for rice in the south has been strong recently, and topdressing of corn is still being followed up. Overall, agricultural demand still exists. In the long run, the demand for urea may weaken after autumn, mainly applying phosphate fertilizer. In terms of industrial demand, plywood factories continue to focus on purchasing, and compound fertilizers are still at a relatively low level. Gradually, a small amount of raw materials are purchased for urea. On the supply side, short-term temperature increases in China have led to an increase in the frequency of equipment failures, a short-term decline in industry start-ups, and a tight supply of goods in the region. On the cost side, the price of anthracite lump coal has bottomed out, and the cost of fixed beds has ended its decline. In terms of inventories, China's inventories are low, and it is speculated that stocks will gradually accumulate in the later period as demand decreases. To sum up, the Royal Liquor Angel urea spot market continued to rise slightly.