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Urea price trends across China on May 20 Author/Source: Yuege Agri Supplies Network Date: 2020-05-20 Clicks: 56 The domestic urea market remained stable, with slight increases in some areas. In certain regions, the pace of new orders from manufacturers slowed down, and downstream buyers became more cautious in their purchases. However, thanks to previous order collections, manufacturers have accumulated a certain amount of stock ready for shipment, so there is no significant inventory pressure in the short term. Yuege Agri Supplies Network predicts that the domestic urea market will see moderate fluctuations within a stable framework in the short term, with manufacturers adjusting their prices flexibly based on their own circumstances. On the supply side, currently the operating rate of domestic urea producers is around 72%, with a daily output of approximately 150,000 tons. Both figures have decreased compared to previous levels. From late May to June, there will likely be more production cuts and maintenance activities at domestic urea plants. On the demand side, some areas in the south are making moderate purchases of agricultural supplies for use downstream, but demand is fairly scattered, which limits its impact on the market. Downstream companies that produce compound fertilizers and panels are cautious in their purchasing, opting to buy only what they need as it is required. Shandong Hualu Hengsheng’s medium-sized particles are priced at 16,150 (a rise of 15), while large-sized particles cost 16,750 (a rise of 5). Hebei Dongguang’s small-sized particles are priced at 1,620 (stable); Henan Xinlianxin’s particles are priced at 1,610 (stable). Shanxi Fengxi’s particles are priced at 1,520 (stable). Jiangsu Linggu’s small-sized particles are priced at 1,720 (stable), while medium-sized particles cost 1,710 (stable). Anhui Haoyuan’s particles are priced at 1,710 (stable). Inner Mongolia Boda’s particles are priced at 1,420 (stable). Shaanxi Shanhua’s locally sold particles are priced at 1,586 (stable). Xinjiang Yankuang’s particles are priced at 1,360 (stable). In the Shandong region, the ex-factory price for small and medium-sized particles is 1,610–1,660 yuan per ton, while the prevailing transaction price ranges from 1,590–1,640 yuan per ton. In the Linyi area, the market price for such particles is 1,660–1,670 yuan per ton. In the Heze area, the purchase price for small and medium-sized particles is around 1,650–1,660 yuan per ton, with prices remaining stable for now. In the Hebei region, the ex-factory price for small particles is around 1,620–1,650 yuan per ton, while the prevailing transaction price is around 1,590–1,610 yuan per ton. The ex-factory price for large particles is around 1,680 yuan per ton, with prices also remaining stable. In the Henan region, the mainstream ex-factory price for small and medium-sized particles is 1,610–1,650 yuan per ton, while the prevailing transaction price is around 1,580–1,620 yuan per ton, with prices stable for now. In the Anhui region, the mainstream ex-factory price for small particles is around 1,680–1,760 yuan per ton, with some companies raising their prices by 20–30 yuan per ton. In the Jiangsu region, the mainstream price for small and medium-sized particles is around 1,670–1,720 yuan per ton, with a few companies increasing their prices by 10 yuan per ton. In the Shanxi region, the export price for small particles is around 1,540–1,560 yuan per ton, while the price for large particles is around 1,540 yuan per ton for new orders; some companies are raising their prices by 10–20 yuan per ton. In the Inner Mongolia region, the mainstream export price for small and medium-sized particles is around 1,430–1,460 yuan per ton, while the price for large particles is around 1,440–1,500 yuan per ton, with prices stable for now. In the Hubei region, the mainstream ex-factory price for small particles is around 1,700 yuan per ton, with prices remaining stable. In the Shaanxi region, the mainstream local sales price for small and medium-sized particles is around 1,600–1,620 yuan per ton, with some companies raising their prices by 20 yuan per ton. In the Guangxi region, the mainstream wholesale price for small and medium-sized particles is around 1,800 yuan per ton, with prices stable for now. In the Sichuan region, the ex-factory price for small and medium-sized particles is around 1,660–1,740 yuan per ton, with prices stable. In the Guangdong region, the mainstream wholesale price for small particles is around 1,820–1,830 yuan per ton, with prices stable. In the Xinjiang region, the ex-factory and transaction prices are around 1,380–1,470 yuan per ton, with prices stable. In the Jilin region, the transaction price for small particles containing urea is around 1,700–1,740 yuan per ton. Prices remain stable. The transaction price for small-grain urea in Heilongjiang is around 1,660 yuan per ton; prices remain stable as well. The freight cost for small-grain urea in Liaoning is between 1,670 and 1,720 yuan per ton, with the actual transaction price subject to negotiation. In terms of supply, factories in regions such as Shandong and Hebei still have some stock ready for shipment, so prices will remain firm in the short term. On the demand side, there is currently little enthusiasm among downstream buyers to place orders; exports from cyanuric acid and plywood manufacturers are hindered, resulting in significantly lower production rates compared to previous years. The compound fertilizer factory has plans to shut down for maintenance in the first half of June, and the overall operational rate will also decrease at that time. In the southern agricultural market, the overall volume of arrivals is limited, social inventories remain low, and spot sales are performing well. Overall, the market sentiment is currently delicate. On one hand, scheduled maintenance at some upstream factories in June will result in a short-term supply gap. On the other hand, although agricultural demand remains strong, industrial demand is likely to decline, and this combined drop in both supply and demand increases uncertainty in the market’s future outlook. The industry players have varying views on the short-term market outlook, and make purchasing and selling decisions based on their own circumstances. Recently, there have been more plans for reduced production or maintenance at domestic urea plants; however, due to limited demand from industry, agriculture, and exports, some downstream users remain cautious, which may pose obstacles to any price increases. Driven by a bullish mindset, the overall trading atmosphere in the market is better than in previous periods; some dealers purchased goods in moderate quantities, but demand remains insufficient, hence there is little momentum for further price increases.