Is the urea market going to change? Is the next year's account cleared?
Time：2019-02-03 Read：559second
2019 during the Spring Festival, the new year has become more and more dense, and everywhere are filled with auspicious words, such as "pig". With the approaching of the Spring Festival holidays, the market of chemical fertilizers has become more and more light, such as phosphorus, potassium and compound fertilizers. Even though urea prices have rebounded slightly recently due to the return of green manure to wheat in a small area of local agriculture, will this market make the industry happy? Maybe. From the market dealers to understand that the trend of urea in the later period is not very promising, most people still think that the aftereffect is insufficient, worrying about transportation, production start-up, demand and other three factors, the urea market is likely to change. During the period around the Spring Festival, factories are more likely to "release" price bills. I do not know whether the annual accounts of each distribution market have been cleared.
Firstly, it comes from the pressure of urea enterprises to start up and rebound. In the process of recovery of gas-head urea enterprises, the pressure of sales at all levels of the market has been aggravated. For example, some urea enterprises in Southwest China have restored part of their load, and others are on the way to resume production. During the Spring Festival, some major urea enterprises in Inner Mongolia also have plans to resume production. Secondly, liquid ammonia, which is closely related to urea, has also greatly boosted the urea enterprise's starting rate to rise again. The Spring Festival holidays are approaching, with high-speed restrictions on dangerous chemicals vehicles, the reduction of starting rate of ammonia enterprises, and the liquidation and sale mode of liquid ammonia enterprises. All kinds of factors lead to the compromise on the price of liquid ammonia in enterprises. Those enterprises will be forced by the pressure of inventory and low price to shift the production center of gravity. To urea, this can be seen from the recent sharp decline in the liquid ammonia market throughout the country; especially during the seven-day holiday, the slow shipment of enterprises, some enterprises have the risk of warehousing expansion, it is bound to produce more urea and less liquid ammonia, naturally urea shipments will increase.
Secondly, the demand for urea in downstream is difficult to guarantee, and the game between upstream and downstream is restarted. In addition to the demand for wheat green manure in the markets of East and Central China, during the special period before the Spring Festival, large agricultural dealers considered the limitation of transportation and the early use of fertilizer, so they still focused on the low-volume reserve in the early stage, followed by the replenishment model with picking in the later stage. In addition, insufficient funds led to the slowdown of the progress of reserve fertilizer, and credit sales between some upstream and downstream areas. Accounts have not yet been settled, which forces production enterprises to introduce appropriate policies or price concessions; the prices of terminal grain and vegetables are low, sales are also under pressure, farmers'income is not good, planting and fertilizer preparation enthusiasm are affected. Instead of reserving ahead of time to bear risks, it is better to reserve a picture on demand, or some industry members will choose to use relatively low-cost advantages of particles. Nitrogen fertilizer replaces urea. Industrial plywood enterprises do not need to expect for the time being, under the pressure of environmental protection, production restriction and the reduction of start-up rate during the Spring Festival holidays; according to the understanding of some raw material fertilizer enterprises to compound fertilizer enterprises, start-up is running at a low level due to the Spring Festival holidays and facing greater cost pressures, and their manufactured fertilizer stocks are high, and some enterprises operating during the Spring Festival are either selling fixed production or digesting manufactured fertilizer for regeneration. Production, in order to ease the inventory pressure of enterprises, the demand for urea is limited, can be said to be a decreasing trend.
Again, the international market is calm, and there is no tender or price advantage. Obviously, the support for the domestic market is limited.
Finally, some urea enterprises in the main producing areas have made sufficient preparations before the Spring Festival, and the orders to be issued are more abundant. For example, some large and medium-sized urea enterprises have realized from some traders that the implementation of the pending issuance is the main task, and there is no inventory for the time being. However, the hidden helplessness is the slow transportation, which to some extent supports the price of urea enterprises to remain firm.
_Generally speaking, the urea market will face the situation that there is no market for urea, even if it needs to be supported, it may be difficult to suppress its shortfall, lack of demand stamina, and the Spring Festival. It's time to clear the accounts.
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