Daily Review of Urea: Market fluctuations and operation waiting for the implementation of the stamp label (August 2)

China Urea Price Index:

According to Feiduo data, the urea small pellet price index on August 2 was 2,516.82, down 2.27 from yesterday, down 0.09% month-on-month, and up 1.44% year-on-year.

Urea futures market:

The opening price of the Urea UR2309 contract: 2332, the highest price: 2364, the lowest price: 2300, the settlement price: 2336, and the closing price: 2308. The closing price dropped 23% compared with the settlement price of the previous trading day, and the month-on-month decline was 0.99%. The daily fluctuation range was 2300-2364, and the spread was 64; The 09 contract reduced its position by 16439 lots today, and held 219511 lots so far.

Spot market analysis:

Today, the prices of Chinese urea companies are mixed, and the overall urea market is operating relatively smoothly. The decline was mainly due to the recent poor shipments in some mainstream regions, which led to some pressure on inventories. In addition, China's demand weakened, and offers were slightly lowered. The increase was mainly due to the fact that international exports still had positive results. Supported by pending orders from peripheral factories, inventories were under general pressure., the quotation made up, which had a slight supporting effect on the correction market.

Specifically, prices in Northeast China rose by 180 to 2,230 - 2,450 yuan/ton. Prices in North China fell by 20 to 2,280 - 2,590 yuan/ton. Prices in the northwest region are stable at 2,510 - 2,520 yuan/ton. Prices in Southwest China are stable at 2,450 - 3,000 yuan/ton. Prices in East China fell by 10 to 2,470 - 2,550 yuan/ton. The price of small and medium-sized particles in Central China has stabilized at 2,490 - 2,700 yuan/ton, while the price of large particles has dropped by 30 to 2,540 - 2,630 yuan/ton. Prices in South China fell by 30 to 2,620 - 2,700 yuan/ton.

Market outlook forecast:

In terms of futures, the trading price of urea futures is relatively stable, which simultaneously drives the sentiment of the urea market. It is expected that the spot price of urea will also develop steadily. On the supply side, upstream factories still need to be supported, and their quotations are quite stable. However, some areas were affected by heavy rains, which led to limited factory shipments and poor actual transactions. Some factories began to slightly reduce their factory quotations. On the demand side, China's agricultural demand has entered the off-season. Coupled with the continuous rise in China's urea prices in the past few days, downstream merchants are still resistant to high prices, so it is difficult to support prices to continue to rise significantly. Internationally, the international price of urea continues to be high, exports have driven the price increase in China's urea market, and India has issued a tender for imported urea. The combination of two factors will further stimulate the market in China's urea market.

Overall, supply and demand in the urea market are currently relatively balanced, and the growth rate has also slowed down. It is expected that China's urea market will remain in a relatively stable state before the final implementation of the stamp label, and there will be no significant correction in prices. The overall situation is mainly due to small fluctuations.