Urea price trends across China on August 22

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Urea price trends across China on August 22 Author/Source: Date: 2019-08-22 Clicks: 37 The domestic urea market is operating in a stable but weak manner, with a slight cooling in trading activity. Following price increases by some companies recently, middlemen have become more cautious in their purchases. Manufacturers in most regions are facing difficulties in securing new orders, and there is a strong sentiment of wait-and-see among market participants. On the supply side, some companies carried out maintenance work in mid-August, causing the operating rate of urea producers to drop to around 63%, which led to a decline in available spot supplies. On the demand side, overall domestic demand remains weak at present. The agricultural sector is in its off-season, and agricultural distributors are cautious about stocking fertilizers. In the industrial sector, demand for urea has seen a slight increase, with some downstream factories beginning to restock slightly; meanwhile, plywood manufacturers in the Linyi area of Shandong are also gradually recovering. Fertilizer manufacturers continue to purchase goods based on their actual needs. It is expected that the domestic urea market will remain stable with only slight fluctuations in the short term. The urea market in Shandong region has seen a slight decline. Currently, the mainstream price for small and medium-sized particle urea is 1,750–1,820 yuan per ton. The purchase price in Linyi is 1,810 yuan per ton, a decrease of 10 yuan per ton. In Heze, the purchase price ranges from 1,790 to 1,800 yuan per ton. Fertilizer manufacturers are mainly dealing with their existing inventory, while plate manufacturing companies have increased production volume but are cautious about making purchases. Demand for fertilizers in agricultural applications is low due to the off-season, domestic demand is weak, and export orders are gradually coming to an end, leading to a generally pessimistic outlook. It is predicted that the local urea market will remain weak in the short term. The ex-factory price of small-grained urea in Shandong region is 1,770–1,830 yuan per ton. In the Linyi market, the transaction price is around 1,810 yuan per ton, while in the Heze market it is approximately 1,800 yuan per ton. Some companies have reduced their prices by 10–20 yuan per ton. The mainstream ex-factory price of small-grained urea in Shandong region has seen a slight increase: Yangmei Pingyuan offers it at 1,755 yuan per ton, with prices remaining stable for now; Ruixing Chemical quotes 1,810 yuan per ton, representing a slight increase of 30 yuan per ton; Mingshui Chemical lists the price at 1,920 yuan per ton, again with stable prices. Overall, the ex-plant price of urea in Shandong region saw a slight increase today; the actual transaction prices are determined through negotiation. The enthusiasm of downstream buyers is moderate, and it is expected that urea prices will remain stable at low levels in the coming period. The urea market in Hebei remains stable, with the mainstream price for small and medium-sized granules at 1,780 yuan per ton. Agricultural demand provides limited support; industrial demand determines sales volume, and new order volumes are not optimistic. Companies mainly handle prior orders and export orders, and it is expected that local urea prices will experience **fluctuations in the short term. Yangmei Pingyuan Chemical Co., Ltd. offers a price of 1,755 yuan per ton for urea. Urea specifications: Purpose: agricultural use; Grade: top quality; Particle size: medium to small particles. This quote is valid for 3 days. Quotation provider: Yangmei Pingyuan Chemical Co., Ltd. Shandong Ruixing Chemical Co., Ltd.’s quote for urea is 1,810 yuan per ton. Urea specifications: Purpose: agricultural use; Grade: top quality; Particle size: medium to small particles. This quote is valid for 3 days. Quotation provider: Shandong Ruixing Chemical Co., Ltd. Shandong Jinmei Mingshui Chemical Group Co., Ltd.’s quote for urea is 1,920 yuan per ton. Urea specifications: Purpose: agricultural use; Grade: top quality; Particle size: medium to small particles. This quote is valid for 3 days. Quotation provider: Shandong Jinmei Mingshui Chemical Group Co., Ltd. In Henan province, the mainstream ex-factory price for small particles remains stable at 1,780–1,810 yuan per ton. In Anhui province, the mainstream ex-factory price for small particles is around 1,850–1,880 yuan per ton, also stable for now. In Jiangsu province, the mainstream prices for medium and small particles range from 1,860 to 1,920 yuan per ton; some companies have increased their prices by 10 yuan per ton. In Shanxi province, the price for large and small particles is around 1,700 yuan per ton, with no changes so far. In Inner Mongolia, the mainstream transaction price for medium and small particles is around 1,550–1,600 yuan per ton, stable as well. In Hubei province, the mainstream price for small particles is 1,830–1,850 yuan per ton, stable currently. In Shaanxi province, the mainstream local sales price for medium and small particles is 1,770 yuan per ton, while the price for shipments to other areas is 1,720 yuan per ton, both stable. In Guangxi province, the mainstream wholesale price for medium and small particles is around 1,950 yuan per ton, stable. In Sichuan province, the urea market remains stable but cautious; the current mainstream local sales price for medium and small particles is 1,780–1,850 yuan per ton, with specific prices subject to negotiation. Currently, manufacturers mainly focus on fulfilling prior orders; in some regions, stockpiling for autumn has begun, but sales remain limited. Due to the overall economic environment, the local urea market is expected to remain weak in the near term. The wholesale price of small-grained urea in Guangdong remains stable at 2,000 yuan per ton. In Xinjiang, the price at the factory level is around 1,400–1,480 yuan per ton, also stable. In Jilin, the price of small-grained urea is approximately 2,000 yuan per ton, unchanged. In Heilongjiang, the price offered by manufacturers for small-grained urea is 1,700 yuan per ton, a decrease of 30 yuan per ton compared to before. In Liaoning, the price for small-grained urea when transported by truck is between 1,820 and 1,860 yuan per ton; the actual transaction price can be negotiated and remains stable. As for futures, the opening price of the main contract UR001 for urea was 1,741.0000 yuan yesterday, and the closing price was also 1,741.0000 yuan, representing no change from the previous trading day. The percentage change was 0.00%, while the settlement price was 1,740.0000 yuan. The open interest of the main contract decreased by 6,622 contracts, with a total of 56,548.0000 contracts traded during the day. In terms of trading positions: the combined position held by both parties is 43,752 lots. The long position held by multiple parties totals 18,345 lots; the member with the largest long position is Yongan Futures, which saw a decrease of 102 lots today. The long position volume is 1,907 lots, accounting for 10.40% of the total long positions; the short position volume is 25,407 lots, with Yongan Futures being the member with the largest short position, which decreased by 32 lots today. The short position volume is 8,822 lots, accounting for 34.72% of the total short positions. In the main production areas, weak support from some export orders has led to a period of stagnation and adjustment. Additionally, since fertilization preparations are still in their early stages in most regions, agricultural demand remains low. Although the weather is gradually cooling down and production activities on the downstream side are increasing, distributors remain cautious when purchasing goods, sticking to a wait-and-see attitude with a generally cautious mindset. It is expected that urea prices will continue to show weak trends and decline in the near term; close attention should be paid to international developments as well as domestic demand conditions.