Domestic market supply and demand imbalance upgrade. The market's dedication to supply and demand has been a barometer of price changes. Since the beginning of domestic demand into the suspended period after the first end to the original farmers lack of confidence in the market then it is because of one disaster after another, the industry needs to follow up, the rapid decline in the price of urea.
From the urea supply side, after the first half of the two months of rotation overhaul, most urea enterprises do not intend to stop. From the first half of August statistics show that, although the price of urea factory Pu fell 50, 80 yuan / ton, the operating rate is still maintained at around 58% level. And I observed that, in order to postpone the parking, the East, North and central China's urea enterprises direct sales of liquid ammonia increased, and even some of the northwest manufacturers are also planning to ease the pressure of urea sales. But this is not a permanent solution, the fact that ammonia Market "difficult to assume responsibility", has begun to decline, only second of August weekend, local ammonia factory price decline reached 200 yuan / ton.
About the demand for urea, can be described as "backing down the mountain, everyone on the run", expected compound fertilizer raw materials procurement to relay high urea, although not fall on urea compound fertilizer and demand, but also to be regarded as one of the market. How come a new round of environmental inspection hit, Linyi compound fertilizer enterprises bear the brunt, since August 15th, for 20 days. According to the 14 day, nearly half of the Linyi composite fertilizer factory is still in production, there is still a demand for urea, goods price of 1490 yuan / ton, further adjustment but wait until 15 days later.
In short, the supply side not only external support, the industry itself in order to make the production of urea prices stabilized as soon as possible. As for the current round of the bottom price, obviously depends on the rate of decline in operation rate.
The international urea market is heating up again. With the latest week's international market for urea, the tone of bottoming out has been set, and demand has improved to bring a wave of bullish prices. Black Sea, Baltic Sea, small particles of urea, offshore guidance price 195, 200 U. S. dollars / ton; Arabia Bay small particles of urea prices also rose to 205 offshore, 210 U. S. dollars / ton. With our country small grain urea 220 / 225 U. S. dollars / ton offshore spreads have narrowed. At the same time, India urea importer also revealed the September purchase intention, seems to take advantage of the foreign trade market also attracted the attention of domestic manufacturers. Since 2016, the supply and marketing pattern of the international market has been adjusted with the export of urea equipment for export to Iran and Saudi arabia. China's urea quotation has become a benchmark for the pricing of Iran and other countries. Because of its cost advantages, it has more factories for export.
Iran, Saudi Arabia's supply of urea will still be the bottleneck of China's export manufacturing prices. Relatively speaking, our country still can keep the southeast urea market share, but the order and demand far less than in the past, set in Hong Kong the urea sponsored enterprises, can only be regarded as a matter of expediency to ease their pressure on the stock, the port play a "reservoir" function. However, taking into account the northwest and North China enterprises have "land and sea transport" outside the phenomenon of South market, do not rule out the late through the transfer of domestic Hong kong. Of course, in terms of the export of urea, China still has no right to speak, and is likely to compromise and hang back in international bidding.
In summary, the current round of market decline in urea or because of the market environment and the price of domestic trouble and foreign invasion dip further, the poor attitude, although there are many factors may be of concern, but in the short term there is no support at all. In fact, the author can still feel the cost support, only from the current anthracite prices up 200, 250 yuan / ton point of view, the cost side of the left to the urea enterprise is too stubborn to price, maintenance tolerance is limited. In other words, once the price of urea fell to 1300 yuan / 1350 yuan / ton, the enterprise operating rate will be significantly reduced, and then make the market showing a bottom.