Urea Daily Review: Export-friendly news remains unclear, market sentiment remains stagnant.
Domestic Urea Price Index:
According to Feidoodoo data, on October 24, the urea small granule price index was 2519.36, a decrease of 11.36 compared to the previous day, a decrease of 0.45% month-on-month, and a decrease of 0.18% year-on-year.
Urea Futures Market:
The opening price of the Urea UR2401 contract today was 2200, with a highest price of 2226, a lowest price of 2174, a settlement price of 2199, and a closing price of 2196. Compared to the settlement price of the previous trading day, it decreased by 19, a decrease of 0.86%. The price fluctuated in the range of 2174-2226, with a price difference of 52. The 01 contract reduced its position by 9,991 lots today, with a current position of 319,537 lots.
Spot Market Analysis:
Today, the domestic urea market underwent adjustments with lower prices compared to the previous day. Rumors of export opportunities cooled the positive sentiment in the domestic market, leading to a shift in the mindset of businesses. Shipment intentions became apparent, but most enterprises were supported by pending shipments, resulting in a stagnant market.
Specifically, in the Northeast region, prices remained stable at 2460-2550 yuan/ton. In North China, prices were stable at 2370-2530 yuan/ton. In the Northwest region, prices were stable at 2470-2480 yuan/ton. In the Southwest region, prices were adjusted to 2420-2800 yuan/ton. In East China, prices decreased to 2460-2520 yuan/ton. In Central China, the prices of small granules decreased to 2430-2660 yuan/ton, and large granules decreased to 2530-2660 yuan/ton. In South China, prices decreased to 2580-2640 yuan/ton.
Market Forecast:
Regarding supply, there have been continuous plant recoveries this week, and daily production will remain at a high level. In a situation of ample supply, prices may continue to decline. In terms of manufacturers, they had received significant orders earlier, and current orders are sufficient. While pending orders are gradually decreasing, prices are expected to undergo downward adjustments. As for inventory, current business inventory levels are low, with intentions for slight accumulation in the short term. Demand-wise, the market is currently in the winter storage phase, with demand following suit. However, as prices continue to rise, downstream buyers are becoming apprehensive about high transaction prices, resulting in a slowdown in new order transactions and a strong market sentiment of wait-and-see.
In summary, the urea market is currently in a stagnant state, with accumulated pending orders for businesses and downstream reluctance to accept high prices. Additionally, the lack of clear export news means that the market lacks substantial positive factors to support it. It is expected that the rate of increase in urea market prices will slow down.
