Since the start of bidding in India at the end of July, the overall price adjustment of urea in China has intensified, with some factories frequently adjusting prices several times a day. However, during the bidding period, there has also been a decrease of one hundred yuan (ton price, the same below) per day. Recently, the Indian bid has gradually come to an end, and the wait-and-see sentiment in some downstream markets has also increased. Although the futures market closed up 5% this Friday, However, during the weekend, some mainstream factories also experienced a certain decline in their quotations. Once the printing label is implemented, what other factors will support domestic urea prices? The main communication points between the author and the market are as follows:

Firstly, the procurement of raw materials in the autumn fertilizer market. Although the current demand in the agricultural market is relatively average, the potential demand for compound fertilizers is relatively high. Although some domestic compound fertilizer companies panicked in purchasing during the labeling period, due to the relatively high price, downstream compound fertilizer companies took less goods. As time goes on, there is a hard demand in the downstream. After the labeling is completed, there is a possibility for some compound fertilizer companies to connect with urea factories and then take goods.
Secondly, social inventory is low. Due to the significant difference between the cost and selling price of urea in the downstream market this year, there is a relatively high level of caution, resulting in a long-term low purchasing enthusiasm. However, it is also because of this that the social inventory of urea has been at a low level for a long time. Recently, domestic urea quotations have been repeatedly quoted, the price adjustment cycle has become shorter, and there has been a sharp rise and fall. The main reason is that the social inventory in the downstream market is at a low level, The resilience of urea price adjustment is relatively low. Once there is a market disturbance, the fluctuation range of urea starts at a minimum of 30-50 yuan. However, in the near future, once compound fertilizer enterprises enter the procurement stage, the price may show signs of upward trend.

Finally, there is a possibility of continued procurement in the international market. Recently, the international market is still tense. Although it is not clear whether India can re bid in the near future, the international news shows that in order to avoid the impact of the Russia-Ukraine conflict, the willingness of the international market to purchase urea is still relatively high, and the international urea price may be repeated.

Although there is positive support, domestic negative factors cannot be ignored, and the above positive factors are also based on the background of acceptable bidding volume for printed samples. Currently, there is not much demand for raw material urea in domestic high phosphorus fertilizer production, and the supply is too high and the cost support is weak. Even in recent times, local demand in Xinjiang has decreased, and urea exports from Xinjiang have gradually increased. Although there is positive support for urea prices in the later stage, But the bearish factors are also relatively large, and there are still signs of price fluctuations in the future.

In summary, recent domestic urea prices have been supported by printing labels, and the overall price is relatively strong. There is also a strong demand for domestic urea in the near future, and there may be signs of price increases. However, once the focus returns to the domestic market, bearish factors must also be considered. It is expected that urea prices may remain stagnant in the near future, and even a slight increase in price levels cannot be ruled out. However, the sustainability of the increase still needs to be studied by the market, in addition to the quantity and price of printing labels, We still need to pay attention to the start of factory operations and the procurement of downstream compound fertilizers in the near future.