Daily Review of Urea: Corporate prices continue to drop slightly, market mentality game continues (December 26)

China Urea Price Index:

According to Feiduo data, the urea small pellet price index on December 26 was 2,430.27, a decrease of 25.32 from yesterday, a month-on-month decrease of 1.03% and a year-on-year decrease of 12.89%.

Urea futures market:

Today, the opening price of the Urea UR405 contract is 2075, the highest price is 2095, the lowest price is 2065, the settlement price is 2080, and the closing price is 2085. The closing price is 7% lower than the settlement price of the previous trading day, down 0.33% month-on-month. The fluctuation range of the whole day is 2065-2095; the basis of the 05 contract in Shandong is 275; the 05 contract has reduced 819 lots today, and the position held so far is 183,300 lots.

Spot market analysis:

Today, China's urea market prices continued to be weak and downward, and the market transaction atmosphere remained weak. In the absence of new positive support, companies lowered their quotations to accept new orders.

Specifically, prices in Northeast China fell to 2,420 - 2,470 yuan/ton. Prices in North China fell to 2,200 - 2,470 yuan/ton. Prices in Northwest China fell to 2,340 - 2,350 yuan/ton. Prices in Southwest China are stable at 2,450 - 2,800 yuan/ton. Prices in East China fell to 2,340 - 2,400 yuan/ton. The price of small and medium-sized particles in Central China fell to 2,320 - 2,580 yuan/ton, and the price of large particles fell to 2,410 - 2,480 yuan/ton. Prices in South China fell to 2,480 - 2,550 yuan/ton.

Market outlook forecast:

In terms of factories, factory orders are gradually reduced, and some companies continue to reduce their quotations slightly in order to receive new orders. Currently, corporate prices still have room to explore. In terms of the market, the market performance was light, spot transactions were limited, futures were short, and the market atmosphere remained sluggish. In terms of supply, most gas head companies have stopped maintenance, and market supply has shrunk. The current supply has reached a recent low. In the later period, gas head companies will resume production in January next year as planned. On the demand side, demand for winter storage this year has been delayed, and downstream purchasing sentiment is still relatively cautious. Except for a small amount of purchase that is just needed, a small amount of actual transactions have been completed; compound fertilizer companies have been slow to deliver goods, resulting in a decrease in operating rates and a decrease in demand for urea procurement.

On the whole, there is currently a small amount of follow-up purchases in the urea market, the market trading atmosphere is flat, and companies have lowered their orders more. It is expected that the urea market price will continue to maintain a stable and downward consolidation in the short term.