Daily review of urea: Demand performance is not warm or hot, mainly follow-up on dips in the field (November 4)

China Urea Price Index:

According to Feiduo data, the urea small pellet price index on November 4 was 1,894.68, an increase of 0.45 from last Friday, a month-on-month increase of 0.02% and a year-on-year decrease of 26.33%.

Urea futures market:

Today, the opening price of the Urea UR501 contract is 1820, the highest price is 1848, the lowest price is 1813, the settlement price is 1834, and the closing price is 1845. The closing price has increased by 22 compared with the settlement price of the previous trading day, up 1.21% month-on-month. The fluctuation range of the whole day is 1813-1848; the basis of the 01 contract in Shandong is-55; the 01 contract has increased its position by 4668 lots today, and so far, it has held 175915 lots.

Today's overall urea futures prices are relatively strong. At present, the fundamental perspective of urea itself is still weak for the time being, but there is certain policy expectation support and reserve demand support below the price, and the space for premium premiums continues. Midstream bargain-hunting arbitrage also has certain speculative demand support. Manufacturers 'sales pressure is still acceptable, although it cannot be formed. Driven by a sharp rise, the willingness to stabilize prices still exists. The market's periodic shocks may have to wait until policy expectations are implemented before they can be broken, which will be transmitted to the demand link.

Spot market analysis:

Today, China's urea market prices are weak and stable.Currently, there are no good things on the market, market trading activity is low, and most downstream players maintain appropriate buying on dips. The emotional stalemate continues, and corporate quotations have not changed much。

Specifically, prices in Northeast China have stabilized at 1,890 - 1,930 yuan/ton. Prices in East China have been raised to 1,790 - 1,830 yuan/ton. The price of small and medium-sized particles in Central China has been lowered to 1,780 - 2,000 yuan/ton, and the price of large particles has stabilized at 1,860 - 1,940 yuan/ton. Prices in North China have stabilized at 1,750 - 1,930 yuan/ton. Prices in South China are stable at 1,950 - 2,030 yuan/ton. Prices in the northwest region are stable at 1,880 - 1,890 yuan/ton. Prices in Southwest China are stable at 1,860 - 2,250 yuan/ton.

Market outlook forecast:

In terms of factories, the advance receipt of new orders by manufacturers is lukewarm. Early orders are being cashed one after another, and the number of order days is gradually decreasing. Most new orders are sporadic and small orders, and removal from the warehouse is still slow. The inventory of urea companies in China continues to rise, and only a few companies has a slight decline due to equipment parking inventory. In terms of the market, the market has no obvious positive guidance and is waiting for new good news to appear. The current mood of the industry is unstable, the fundamentals are still loose for a short time, and the market is temporarily fluctuating within a narrow range. On the supply side, there have been an increase in equipment maintenance failures in enterprises in recent days, and the industry's daily production has shown a downward trend. Most companies only maintain a balance between production and sales. On-site parking has slowed down the process of accumulating warehouses to a certain extent. The supply pressure in the industry has eased slightly, and the overall supply and demand fundamentals are still loose. situation. On the demand side, with the end of autumn fertilizer, downstream follow-up is cautious, and demand is still weak. The buying atmosphere is tepid. Traders and terminals are mostly maintaining bargain-hunting reserves. The operating rate of compound fertilizer factories shows signs of a slight rebound, and the overall follow-up is limited.

On the whole, the current reserve demand in the urea market in China is mostly based on the price level to cover positions appropriately, and the number of on-site transactions is limited. It is expected that the urea market will fluctuate within a narrow range in a short period of time, and prices will be under pressure and will be slightly lowered.