Daily Review of Urea: Market transaction activity is not high, the market continues to be weak and downward (August 28)

China Urea Price Index:

According to Feiduo data, the urea small pellet price index on August 28 was 2,092.09, a decrease of 7.27 from yesterday, a month-on-month decrease of 0.35% and a year-on-year decrease of 18.27%.

Urea futures market:

Today, the opening price of the Urea UR501 contract is 1884, the highest price is 1892, the lowest price is 1863, the settlement price is 1876, and the closing price is 1871. The closing price is 11% lower than the settlement price of the previous trading day, down 0.58% month-on-month. The fluctuation range of the whole day is 1863-1892; the basis of the 01 contract in Shandong is 149; the 01 contract has increased its position by 8223 lots today, and the position is 163635 lots so far.

Today, urea futures prices surged and fell back with the market environment, with the overall weak operation mainly. Recently, the fundamentals of urea itself have not improved significantly. The main logic of strong supply and weak demand and regulatory policies still suppress price elasticity. The continued recovery of the operating level of downstream compound fertilizer companies still supports demand, but it is temporarily difficult to form a strong replenishment market., market sentiment is difficult to release in the short term. Futures prices lack self-driving in the short term or may still be dominated by emotional shocks in the overall market environment.

Spot market analysis:

Today, China's urea marketThe transaction atmosphere is still weak, corporate quotations continue to be lowered, and the marketSpot transactions are average, and the short-term market lacks follow-up support for new orders, making it difficult for prices to move upwards.

Specifically, prices in Northeast China have been lowered to 2,080 - 2,110 yuan/ton. Prices in East China have been lowered to 2010-2080 yuan/ton. The price of small and medium-sized particles in Central China has been lowered to 2020-2250 yuan/ton, and the price of large particles has been lowered to 2110-2180 yuan/ton. Prices in North China have been lowered to 1,900 - 2,100 yuan/ton. Prices in South China have been lowered to 2,140 - 2,230 yuan/ton. Prices in Northwest China have been lowered to 2,080 - 2,130 yuan/ton. Prices in Southwest China are stable at 2,050 - 2,450 yuan/ton.

Market outlook forecast:

In terms of factories, most manufacturers currently have a small number of new orders, mainly executing pre-orders and waiting for support. Some companies with relatively few orders are facing shipping pressure, and the quotations have been slightly lowered. However, the overall new order follow-up atmosphere is general, and the shipping pressure of manufacturers is gradually apparent., driving the focus of market negotiations to further explore. In terms of the market, the market transaction activity after the price was loosened was not high, the follow-up situation of new orders was average, the buying sentiment was flat, the industry operators had a strong wait-and-see attitude, and the mood was strong and volatile in the short term, and the market gradually relaxed in a stalemate. On the supply side, the industry's Nissan continues to improve, but the recovery is slow. Nissan fluctuated for a short time, with little change and still maintained a high level. On the demand side, the current demand support is not good, and the downstream procurement atmosphere is general. Most people maintain appropriate follow-up on dips. There is no sign of large-scale follow-up and replacement orders. Short-term weak consolidation is the main reason.

On the whole, the current urea market continues to be weak and volatile, and the market operation appears to be deadlocked. The market lacks actual positive support, and prices are under pressure to go downward. It is expected that the urea market price will remain mainly downward in the short term.