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Urea price trends across China on August 30 Author/Source: Yuege Agri Supplies Network Date: 2019-08-30 Clicks: 9 The domestic urea market has shown steady fluctuations on a minor scale; overall transaction volume remains average. Manufacturers mostly adhere to the pre-payment system established earlier, and prices remain relatively stable. On the supply side, recently some companies have planned to shut down for maintenance, and environmental regulations in the Jincheng area of Shanxi have led to reduced production, causing the operational rate to drop to around 62%, with a daily production volume of approximately 149,000 tons. On the demand side, the agricultural market is still in the off-season for fertilizer use. After a few dealers stocked up on fertilizers last week, they have reverted to a wait-and-see attitude, resulting in very limited transactions in this market. The next peak period for urea use in China will be during the autumn fertilization period from late September to early October. The areas where urea is used in relatively large quantities during this season are mainly northern Anhui, southern Henan, and some regions in Jiangsu, while usage is relatively low in other areas. In the industrial sector, the operation of plywood factories in Linyi, Shandong, has seen a slight recovery, but there has not been a significant increase in activity. New environmental inspections have been launched in that area, further suppressing industrial demand there. The production at compound fertilizer factories is currently relatively stable, and manufacturers tend to purchase urea raw materials as needed. It is expected that the domestic urea market will remain stable with only slight fluctuations in the short term. As urea plants in Inner Mongolia began maintenance work one after another, market confidence improved slightly. Some industrial users believed that prices were at relatively low levels, so they placed small orders to meet their production needs. However, industrial activity downstream in the North China region remained low. At the same time, due to the sharp rise in futures prices, spot-traders in the delivery area entered the market to purchase contracts for arbitrage purposes. The market expects the urea production rate to decline in September, and due to cost support, there is limited room for further price drops. However, since neither traders nor end-users are willing to build up large inventory levels, there are no signs of a significant price increase at present. Social inventory in MERCOSUR remains low, and spot sales are being absorbed at a rapid pace. The stock at upstream factories is sufficient to last 5-7 days, and prices are expected to remain relatively stable in the short term. The prevailing ex-plant prices for small-grained urea in the Shandong region remain stable: Yangmei Pingyuan offers 1,755 yuan per ton, with no changes in price; Ruixing Chemical offers 1,780 yuan per ton, also with stable prices; Mingshui Chemical offers 1,900 yuan per ton, again with stable prices. Overall, the ex-plant prices of urea in Shandong region remain stable today, with actual transaction prices determined through negotiation. The enthusiasm for purchasing at the downstream end is moderate, and urea prices are expected to remain stable at low levels in the coming period. Yangmei Pingyuan Chemical Co., Ltd. quotes 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 1,780 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 1,900 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 the Shandong region, the ex-factory price for small particles is 1,730–1,830 yuan per ton. In the Linyi market, the transaction price is around 1,790–1,800 yuan per ton, while in the Heze market it remains stable at around 1,790 yuan per ton. In the Hebei region, the ex-factory price for small particles is 1,740–1,790 yuan per ton, with prices remaining stable. The urea production facilities in Anyang, Henan, are operating normally, producing over 600 tons per day; there is little inventory available, and prices are determined on a case-by-case basis. Previous orders are still being processed; there is little enthusiasm on the part of downstream customers to receive goods, resulting in moderate sales volume. In the Henan region, the standard ex-factory price for small particles is 1,760–1,800 yuan per ton, with prices remaining stable. A few companies have raised their prices by 20 yuan per ton. In Anhui, the standard ex-factory price for small particles is around 1,820–1,850 yuan per ton, also stable. In Jiangsu, the standard prices for medium and small particles range from 1,840–1,900 yuan per ton; some companies have lowered their prices by 10 yuan per ton. In Shanxi, the prices for large and small particles are around 1,680–1,690 yuan per ton, with no changes so far. In Inner Mongolia, the standard transaction prices for medium and small particles are around 1,520–1,560 yuan per ton, stable as well. In Hubei, the standard price for small particles is 1,830–1,850 yuan per ton, stable for now. In Shaanxi, the local sales price for medium and small particles is around 1,750–1,770 yuan per ton, while the price for shipments to other areas is 1,680 yuan per ton, still stable. In Guangxi, the market wholesale price for medium and small particles is around 1,900 yuan per ton, stable. In Sichuan, the ex-factory price for medium and small particles is around 1,780–1,860 yuan per ton, stable. In Guangdong, the standard wholesale price for small particles is 1,950–1,970 yuan per ton, stable. In Xinjiang, the ex-factory transaction prices are around 1,400–1,480 yuan per ton, stable. In Jilin, the price for small urea particles is around 2,000 yuan per ton, stable. In Heilongjiang, the transaction price for small urea particles produced by local manufacturers is around 1,700 yuan per ton, stable. In Liaoning, the price for small urea particles transported by truck is 1,760–1,840 yuan per ton, with prices negotiable; overall, prices remain stable. In northern Jiangsu and Anhui, there is some preparation of fertilizers, but in most areas, the preparation process is slow. Fertilizer manufacturers purchase goods according to their needs. Factories in Linyi that produce rubber sheets have stopped production, resulting in limited demand. Traders are cautious about making purchases, so the market atmosphere remains mediocre. However, in Shandong, orders are still acceptable due to low-priced supplies, and with tightened supply from Inner Mongolia, there is a strong tendency to maintain prices at present. It is expected that urea prices will remain stable with slight fluctuations in the near future. Attention should be paid to international developments and domestic environmental regulations.