Recent trends in urea prices

Under the weak support of raw material anthracite and the temporary lack of favorable downstream demand, the urea market price in Shandong fluctuated narrowly this week. According to the Commodity Analysis System of Business Society, the price of urea in Shandong increased from 2461.67 yuan/ton at the beginning of the week to 2465 yuan/ton at the end of the week, an increase of 0.14%, and the weekend price decreased by 10.23% year-on-year.

Details of domestic urea prices this week

From the supply side perspective: In the early stage, urea maintenance manufacturers resumed production, resulting in an increase in daily urea production. The data shows that the daily urea production in China is about 160000 tons, with coal urea enterprises operating at a rate of about 85% and gas urea enterprises operating at a rate of about 40%. The mainstream urea manufacturers in Shandong saw a slight increase in factory prices during the week.

Details of the price of Yangquan anthracite coal this week

Variety/ January 15th/ January 21st/ Changes

Anthracite coal (washed lump)/ 960 yuan/ton/ 960 yuan/ton/ None

From the upstream market perspective, there were ups and downs in the urea upstream market this week: the price of liquefied natural gas plummeted by 8.32%, and the weekend price fell by 17.16% year-on-year. Affected by rainy and snowy weather in some regions of China, market circulation is restricted, and liquid factory shipments are under pressure, leading to a continued decrease in liquid prices. The price of liquid ammonia increased by 2.93%, and the weekend price fell by 22.42% year-on-year. However, the prices of anthracite coal have remained low and have stabilized. Over the weekend, the price of Yangquan anthracite coal (washed lump) was 960 yuan/ton, indicating a continued weak trend in the coal market in the short term. Overall, there has been a significant drop in upstream raw material prices, which lacks support for urea prices.

From the perspective of downstream demand: agricultural demand is at the end of the off-season, while industrial demand follows the market. Composite fertilizer, board, and melamine enterprises are operating at a low level, and some industries are gradually shutting down for holidays, with a focus on essential procurement. This week, the downstream price of melamine in urea has stabilized at a high level, with a price of 7450 yuan/ton. From the perspective of exports: Although there are still bids overseas, the impact of urea export policies on the domestic market is not significant.

Looking ahead, the urea market in Shandong may experience a slight fluctuation and decline in late January. Business Society urea analysts believe that the upstream market of urea has significantly declined, and the cost support for urea is insufficient. Downstream industrial demand is mainly in demand, while agricultural demand has not yet recovered. In the second half of the year, gas companies will start construction one after another, and it is expected that Nissan will recover to some extent. In the future, urea may experience a narrow range of fluctuations and decline.