Daily Review of Urea: Markets tend to stabilize and prices are weak (February 1)

China Urea Price Index:

According to Feiduo data, the urea small pellet price index on February 1 was 2,253.64, a decrease of 6.82 from yesterday, a month-on-month decrease of 0.30% and a year-on-year decrease of 20.10%.

Urea futures market:

Today, the opening price of the Urea UR405 contract is 2083, the highest price is 2117, the lowest price is 2065, the settlement price is 2085, and the closing price is 2108. The closing price has increased by 18 compared with the settlement price of the previous trading day, up 0.86% month-on-month. The fluctuation range of the whole day is 2065-2117; the basis of the 05 contract in Shandong is 72; the 05 contract has reduced its position by 5996 lots today, and so far, the position has held 169,000 lots.

Spot market analysis:

Today, China's urea market prices have been consolidated downward. Affected by restrictions on cargo transportation, the market transaction atmosphere has dropped compared with the previous period, and most companies 'quotations have remained stable.

Specifically, prices in Northeast China have stabilized at 2,190 - 2,270 yuan/ton. Prices in North China fell to 2020-2280 yuan/ton. Prices in East China fell to 2,170 - 2,250 yuan/ton. Prices in South China fell to 2,350 - 2,400 yuan/ton. The price of small and medium-sized particles in Central China fell to 2,170 - 2,380 yuan/ton, and the price of large particles fell to 2,240 - 2,320 yuan/ton. Prices in the northwest region are stable at 2,210 - 2,220 yuan/ton. Prices in Southwest China are stable at 2,230 - 2,600 yuan/ton.

Market outlook forecast:

In terms of factories, manufacturers have fully received advance orders during the Spring Festival and have entered the final stage one after another. Currently, shipments are mainly at high prices, and the quotations are stable and medium. In terms of the market, rainy and snowy weather has affected logistics, factory goods shipments have been limited, and the market transaction atmosphere has weakened compared with the previous period, resulting in insufficient motivation for prices to continue to rise, and market conditions may loosen and explore. On the supply side, as the maintenance equipment of gas head enterprises is starting to resume production, Nissan is gradually recovering and supply is becoming more abundant. However, recently, the industry's shipment of goods has accelerated, and the current company's inventory has dropped compared with last week. On the demand side, as the Spring Festival approaches, the demand for demand continues to weaken, downstream sentiment for chasing high declines, and plate factories have left the market one after another on holidays; the operating rate of compound fertilizer companies has continued to decline; follow-up of agricultural demand is limited, and the overall demand side is operating in a weak position.

On the whole, companies in the urea market are currently receiving sufficient orders and supporting the downward trend of inventories. However, due to limited shipment of goods, prices continue to have difficulty rising. It is expected that the urea market will be consolidated and operational in a short period of time, and prices will be stable and adjusted.