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Urea price trends across China on July 20 Author/Source: Yuege Agri-Materials Website Date: 2021-07-20 Clicks: 6 Since the weekend, the domestic urea market has shown a stable but weak trend; in some areas, transaction prices have declined. Urea manufacturers are mainly handling pre-paid orders, with few new orders coming in. Downstream buyers are less willing to pay high prices for urea, and their enthusiasm for purchasing it is moderate. On the demand side, agricultural demand is limited; the use of fertilizers in agriculture in the Northeast and Northwest regions is nearing completion. In regions such as North China and East China, there are only occasional purchases to replenish stock. Industrial compound fertilizer manufacturers have entered the production phase for autumn-use fertilizers, and their operating rates have increased compared to earlier periods. The operating rate in the melamine industry is around 67%, remaining at a high level compared to the same period last year. Small and medium-sized plywood manufacturers, due to their reluctance to use urea at high prices, operate at moderate capacity levels. On the supply side, urea manufacturers have been alternating between reducing production and resuming operations, resulting in a daily urea production level of around 160,000 tons; it is difficult to see a significant increase in the short term. In terms of raw materials, following the roof water and sand inrush accident at the Haojialiang Coal Mine on July 15, Yulin underwent a comprehensive production inspection. On the same day, the provincial environmental protection agency arrived in Yulin to conduct an extensive environmental audit. As a result, the number of coal mines that stopped operating increased sharply, with nearly 30 such mines shutting down. Moreover, due to the hot and rainy weather, the shipment and distribution of coal were restricted, while demand for coal for power generation increased significantly. The heavy rains in Shanxi led to disruptions in the coal transport railways within the province, restricting rail shipments from Shanxi to Henan and Shandong, which further exacerbated the shortage of coal downstream. As a result, domestic coal prices are likely to rise rather than fall in the short term. It is expected that the domestic urea market will remain volatile at high levels until the import quotas are finalized. Below are the latest prices across various regions in China today: The main ex-factory prices for urea as of July 20. Price changes in different regions – In Shandong, the ex-factory price for small and medium-sized particles is around 2700–2750 yuan per ton. In Linyi, the market price for such particles is around 2720–2730 yuan per ton. In Heze, the purchase price for small and medium-sized particles is around 2710 yuan per ton, with prices remaining stable for now. In Hebei, the ex-factory price for small particles is around 2750–2770 yuan per ton, also stable. In Henan, the main ex-factory price for small and medium-sized particles is 2740–2790 yuan per ton, with prices stable. In Anhui, the main ex-factory price for small particles is around 2790–2810 yuan per ton, stable as well. In Jiangsu, the main price for small and medium-sized particles is around 2850–2880 yuan per ton, stable. In Shanxi, the price for small and medium-sized particles is around 2660–2670 yuan per ton, with some companies offering prices 10 yuan per ton lower. In Inner Mongolia, the main price for small and medium-sized particles is around 2600–2710 yuan per ton, stable. In Hubei, the ex-factory price for small particles is around 2750 yuan per ton, stable. In Shaanxi, the local market price for small and medium-sized particles is around 2700 yuan per ton, with some companies offering prices 30 yuan per ton lower. In Guangxi, the main wholesale price for small and medium-sized particles is around 2830 yuan per ton, stable. In Sichuan, the ex-factory price for such particles is around 2650–2670 yuan per ton, stable. In Guangdong, the main wholesale price is around 2850 yuan per ton, stable. In Xinjiang, the ex-factory price is around 2450–2580 yuan per ton, stable. In Jilin, the ex-factory price is around 2800 yuan per ton, stable. In Heilongjiang, the price for small particles transported by road or train is around 2670 yuan per ton, stable. In Liaoning, the price for small particles transported by road is around 2760–2820 yuan per ton, stable. Overall, the urea market across the country is relatively stable, with only slight price increases in some regions. The Jincheng factory has seen its railway shipments disrupted due to heavy rain and landslides, resulting in a decrease in daily urea production. Fertilizer plant inventories are low, so they are entering the market to make purchases again at current price levels. Overall, shipments to MERCOSUR have declined, with prices showing both increases and decreases. Overall, there is no significant increase in market demand, with supply and demand remaining relatively balanced. The domestic market is relatively optimistic regarding expected printing prices and supply levels. With domestic price increases being weak and below international market prices, the volume of goods gathered at domestic ports has increased. Urea prices are expected to remain largely stable, but given low levels of inventory in the market, price fluctuations are likely to be significant.