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The reason for urea price increase is not only the printing mark
Time:2020-10-23   Read:769second  

The dust settled one after another in India, and the price of urea in China rose one after another. Similar to the previous situation, the price of urea in China also increased to a certain extent under the influence of the Indian bidding. It is understood that India's RCF has extended the validity of the bid to October 23 again. It is reported that China is ready to send about 700000 tons of urea to India, and the middlemen may also China increases procurement. However, up to now, urea prices have not risen significantly, and from the recent market information, sales after partial price increases are generally. The price increase of urea is not entirely due to the printing of the standard, but also benefited from the fertilizer demand in North China, Northwest China and Northeast China. For example, the rising price of raw natural gas in the southwest market, the high price of liquid ammonia, and the shift of production focus of some enterprises are also concerned about its future trend.

The market of urea has been rising steadily and partially, but the rising trend is slowing down and the increase is shrinking. The wholesale market at the basic level still has a price but no market. The large agricultural material suppliers reserve prudently and there is demand from the industry, but the large orders are still small. Although the operating rate of urea enterprises is low, there is a rising trend. It is understood that the supply of small granule urea in Shanxi is in short supply, and the mainstream ex factory quotation is about 1600-1610 yuan / ton, and the urea of individual enterprises in Sichuan and Chongqing area has increased greatly to 1680 yuan / ton. Some large agricultural material suppliers say that the price of urea has increased greatly, and the downstream procurement is also more cautious. Therefore, in order to avoid risks, they do not plan to reserve a large amount of urea.

First of all, the reason for the price increase of urea is the printing bid. As of recently, the bid winning quantity of India may increase to 2.229 million tons, and the goods will be shipped before November 16. However, India's RCF has extended the validity of the bid to October 23 again, mainly for seeking financial support and port allocation. Although there are logistics problems in China's ports, the total bid volume of urea in China is expected to be relatively high Considerable. This will undoubtedly promote the export of urea in China, and alleviate the situation of oversupply in the domestic urea market to a certain extent, and some manufacturers shift their focus to export orders.

Secondly, the domestic market demand for fertilizer support. According to the statistics of China chemical fertilizer network, the overall industry operating rate of compound fertilizer enterprises is only about 47%. However, with the introduction of winter storage policies and prices, the production progress of the enterprise will be promoted to a certain extent, and the purchase quantity of raw material urea will also be increased. In addition, the construction of plywood plant is still acceptable, and the demand for urea is considerable. In addition, some parts of Guangdong, northwest and southwest China And other areas of fertilizer demand procurement. In addition, it should be mentioned that some urea enterprises in Sichuan and Chongqing said that under the support of the expected increase in the price of raw gas, downstream supplies of urea were increasing, resulting in a tight supply of local urea, and the price continued to rise. Some enterprises increased by 100 yuan / ton.
Once again, the operating rate of urea enterprises is low to only 55.6%, and local supply is tight. Under the influence of production restriction, the start-up of urea enterprises in Jincheng area of Shanxi Province is still on the low side; a few urea enterprises in Shandong and Henan are in the process of maintenance; in addition, the market of liquid ammonia is relatively good, the prices of various places are at a high level, and a few enterprises have shifted the production focus to them slightly, and local urea output has slightly decreased. However, due to the high price of liquid ammonia and even continued to rise, the downstream resistance to it, coupled with the release of local new capacity, the market of liquid ammonia has a trend of weakening. At this time, some enterprises may shift their production focus back to urea.

Finally, in a comprehensive view, the price increase of urea is not only the printing mark, but also the support of the starting of local demand and the reduction of supply side. However, due to the limited overall demand, especially the agricultural sector is in the off-season, the lack of the most critical supporting factors. In addition, with the resumption of production of some maintenance enterprises, the downstream resistance to urea reserves and other negative factors have increased. It is expected that the next step will be taken The increase of urea should be relatively limited, and it should be the trend of small rise in some areas.

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