Since the beginning of the week, urea has been continuously increasing by over a hundred yuan per day. Today, some areas are still rising, and some regions have temporarily stabilized. For example, the mainstream factory quotation of urea in Hebei Province has increased by 240 to 300 yuan/ton to around 2600 to 2670 yuan/ton. As of yesterday, the receiving price of urea by composite fertilizer enterprises in Linyi, Shandong Province has increased to 2600 yuan/ton. It seems to be a combination of positive factors, but the increase and momentum are unexpected, and the increase is quite abnormal, Especially in some enterprises, there has been a phenomenon of suspension of revenue; The basic reasons for the price increase can be summarized as the sudden release of the printing label, the high boost of international urea prices, and the increase in domestic coal prices, among other factors, which have also contributed to the hype atmosphere in the domestic market. As a result, urea prices have experienced an upward trend that exceeds the actual demand support.

After the significant increase in urea prices, it has driven the overall operating rhythm of the domestic fertilizer market. Phosphorus and potassium fertilizers are ready to move forward, and local prices have tentatively increased. Compound fertilizers are under passive pressure, leading to some enterprises being forced to stop receiving and reporting. As a small nitrogen fertilizer, ammonium chloride is also supported by the rise in urea prices. Local ammonium chloride prices have seen a significant increase in a short period of time, and there are also signs of rising in other places, However, given the rapid rise and fall in urea prices in the early stages, the overall pace of price adjustment for ammonium chloride is relatively cautious and maintains a positive trend.

Whether the "strange" trend of urea can last long, simply from a rapid rise but not supported by domestic demand, it is difficult to maintain it for a long time. On the one hand, from a supply perspective, according to statistics from China Fertilizer Network, the total daily production of urea is about 168000 tons, slightly increasing compared to before the price increase of urea. In early August, a new urea production capacity of a factory in Shandong will be put into operation, and urea companies parking in the nearby Sichuan Chongqing area should also resume production in mid August. Moreover, under high prices, the production enthusiasm of each factory is relatively high; The price of liquid ammonia is also soaring, with increases of around 450-650 yuan/ton in many places this week, and the factory generally costs 3000 yuan/ton or above. Whether the production center is tilted towards urea or liquid ammonia, it has advantages. On the other hand, the export support of urea is strong, and the international price is high, as well as the bidding suddenly issued by India, resulting in tight supply in the domestic Spot market, especially against the background of low social inventory; However, the performance of domestic agricultural demand is average, with the main focus being on replenishment during the off-season, and the industrial sector just needs to purchase. However, it should be taken into account that due to the long-term high operation of urea, there is a panic buying situation in some downstream areas; Moreover, the rising price of coal, the rising cost of urea enterprises and the rising sentiment of the futures market will inevitably affect the Spot market if the futures market cools down in the later period, as well as the risk of urea backflow from ports. If all kinds of potential negative factors are released, that is when urea changes.

Supported by urea, the bottom line of ammonium chloride price rise increased, and some markets took the lead in increasing the price. For example, the mainstream ex factory quotation of dry ammonium in East China rose to 700 yuan/ton. Compared with the receiving price of urea from compound fertilizer plants in Linyi, Shandong, ammonium chloride still holds the advantage of low price. In addition, it also depends on the changes in supply and demand of ammonium chloride itself. On the one hand, according to statistics from China Fertilizer Network, the overall industry operating rate of Lian Alkali Enterprises is still slightly higher at 80%, and there is not much change in operating in August. However, new production capacity of ammonium chloride may be put into operation in September, which will be the biggest negative impact on the market in the later stage; On the other hand, the demand for ammonium chloride has performed well. Firstly, supported by urea, some downstream composite fertilizer enterprises have been prompted to purchase ammonium chloride instead of some urea for use. Secondly, the production of extruded granular ammonium chloride enterprises has improved. Thirdly, the export performance of ammonium chloride is decent, slightly boosting the domestic market. Fourthly, the recent market atmosphere for ammonium chloride is relatively high, and confidence in the later stage is also sufficient. However, there is still a bearish outlook in the long-term market, as there is a risk of a high price drop in urea, and the current demand for ammonium chloride is mainly in demand, as well as concerns about the release of new production capacity in the future. Overall, the recent positive trend of ammonium chloride has dominated the market, and there is room for some quotes to rise. However, do not overly rely on the bullish atmosphere to influence the market.