As expected last week, urea prices rose again in September after reaching the end of August, with prices rising by more than 50 yuan / ton in all parts of the country within a week, and factory prices in the mainstream region are now stabilizing at 2,000 yuan / ton for the time being. The favorable market mainly comes from the international market. Under the normal situation of tight supply and demand, the international urea price continues to rise, and the demand for urea in the international market is increasing. Combined with the strong dollar and other factors, the domestic urea market will once again be in line with the international market.

Multiple benefits support

Analysis of the market can be seen that, in addition to the downstream wait-and-see mentality, there are no other negative factors, while the positive factors are increasing.

First, environmental factors. In the four quarter, environmental factors have to be mentioned. At present, environmental protection has not had a great impact on the market, but it is undeniable that the environmental protection situation is gradually becoming more stringent, and with the passage of time, its impact will gradually appear.

Second, supply and demand are good. Since the beginning of this year, under the control of supply-side reform and environmental protection and production safety policies, China's urea supply has been declining continuously. Once the situation of annual overcapacity has been changed, the overall supply and demand situation has always been in a state of balance or tight balance, and will be normalized. The supply and demand situation will become a positive trend and has been recognized by the industry.

Third, export is good. On the one hand, the continued strength of the US dollar makes the currencies of many countries depreciate and their purchasing power decline. This has hindered the import of urea from India, Pakistan and other countries, and also brought opportunities for China's urea exports. From 6.3 at the end of April this year to 6.8 at present, the impact on a ton of urea has reached 100 yuan. On the other hand, the demand of the international market is excellent, and the competitiveness of China's urea is obvious. Recently, Bangladesh continued to invite tenders, and later Bangladesh, India, Ethiopia and other countries still have tender plans, and because of the buyer's packaging requirements, China's supply competitiveness is obvious. According to the FMB forecast, India will also be about 1.5 million tons of procurement tenders this year, coupled with the post-booming demand in South America, the fourth quarter of the international market will remain optimistic. At the same time, due to U.S. sanctions against Iran, Iran's urea export situation is grim, already can only face a very single Indian market, if India and the United States later frustrated negotiations, Iran's nearly 4 million tons of trade will be withdrawn from the market, which will bring more opportunities to China's supply.

Price or innovation high

Supported by multiple benefits, especially the release of international market demand, the domestic urea price has soared. As of Sept. 11, the quotation of urea mainstream factory in Shandong Province was temporarily stable at RMB 1990-2000 per ton, while the quotation of enterprises was temporarily stable at RMB 1990-2010 per ton; the quotation of urea mainstream factory in Hebei Province was temporarily stable at RMB 1990-2010 per ton; the quotation of urea mainstream factory in Henan Province was temporarily stable at RMB 1975 per ton, and some enterprises were mainly for export market in Shanxi Province. The outgoing plant quoted 1950-1960 yuan / ton. Because the price is too high, the new orders of enterprises in all parts of the transaction are more general, enterprises to carry out pre-order, or transfer to the export market, have confidence in the future market, the price has continued to increase intention.

_Analysis of urea market in this year shows that urea supply in China continues to decline, raw material costs are on the high side, agricultural demand is slightly reduced, industrial demand is increased, and social inventory is extremely low. This situation weakens the role of TRADERS'reservoirs, further strengthens the linkage between terminal demand and factory prices, and the relationship between supply and demand has been established. From the original oversupply to a tight balance. Because of seasonal reasons, the contradiction between supply and demand is still prominent. Export has also been transformed from a traditional urea exporter to a phased import and export country.

China's fourth quarter export increase has become a reality. In the just-concluded bidding process in Bangladesh, China realized a low supply of FOB310, and Shandong, Hebei and other places signed some export orders. It is expected that China's Urea Export will reach about 1 million 500 thousand tons this year.

In a word, under the circumstances of stricter environmental protection policy, tight supply and demand situation and favorable export situation, the upstream manufacturers are confident of the future market and still have the intention to raise prices. But considering that the current price has reached or even exceeded the peak season price level, whether the follow-up price can break through the high still needs to pay attention to the international market. It is expected that prices will rise sharply in the short term, and there is no big decline. In the long run, the domestic supply of urea in kind has been declining continuously in the fourth quarter, the international market demand has been booming, export may achieve a certain amount of breakthroughs in the premise of this year's urea prices will be higher than last year's bottom, the top will also break through last year's 2050 yuan / ton factory price, optimistic about the latter part of the market.