At the beginning of the new year, the performance of the nitrogen fertilizer market is not ideal. Although urea prices have rebounded recently with the support of weak storage replenishment and local demand, on the one hand, the increase is small, and on the other hand, the emotional drive is greater than the support of actual demand; The current weak rise in urea prices has led to sporadic declines in prices in Shaanxi region, and the overall upward trend may also come to an end. The performance of small nitrogen fertilizer ammonium chloride is significantly weaker than urea, with weak demand and flexible selling prices in the market, which have forced factories to continuously lower their prices. The market is in a wait-and-see mood, and the recent increase in urea prices may have slowed down the pace of ammonium chloride price reduction to some extent, thereby narrowing the decline in ammonium chloride. However, the urea market has also begun to weaken.

Recently, supported by low-priced advance orders and local demand for goods, urea has been slowly increasing. However, the pessimistic expectation has not dissipated, and the overall market fatigue is gradually becoming apparent. In terms of price, the mainstream ex factory quotation for urea in Northeast China is 2350-2418 yuan/ton, while in Shanxi region it is 2270 yuan/ton. Yesterday, the composite fertilizer factory in Linyi, Shandong received urea at a price of 2340 yuan/ton; In contrast, the low price advantage of ammonium chloride is particularly obvious, but from the downstream procurement situation, it has not stimulated the purchasing enthusiasm for ammonium chloride. Currently, the mainstream ex factory price of dry ammonium is around 570-650 yuan/ton, with single negotiation being the main approach. The delivery price of dry ammonium in Linyi, Shandong is 680 yuan/ton, and the reference price of dry ammonium to port in Bayuquan Port is 680 yuan/ton. In addition to the mutual influence of urea and ammonium chloride, their respective supply and demand performance is also crucial.

In the short term, urea supply and demand are relatively balanced, but in the middle of the month, there may be a significant oversupply. Some gas head urea enterprises in the southwest have limited production and stopped production, while urea enterprises in the Jincheng area have limited production. Some individual enterprises occasionally stop due to malfunctions. According to statistics from China Fertilizer Network, the total daily production of urea is about 152500 tons. However, some gas head enterprises will prepare to resume production in the middle and later stages, and temporary maintenance enterprises will also resume in the short term, indicating an increasing trend in supply; However, the demand for urea is decreasing. Currently, some grassroots units need to purchase fertilizers and replenish them appropriately before the Spring Festival. In addition, the recent low price of urea has to some extent stimulated downstream purchasing enthusiasm; But as the Spring Festival approaches, the decrease in production of downstream compound fertilizer plants and plate plants becomes more significant, and urea companies should make appropriate price reductions to attract orders; Furthermore, the domestic policy of ensuring supply and stabilizing prices has led to restrictions on urea exports, resulting in a lack of support for the domestic market. Overall, the momentum behind the rise in urea is insufficient. There are pending orders to support the price increase in the short term, but in the long run, the quotation may face downward pressure.

The slight increase in urea prices is a rare benefit for ammonium chloride, prompting some downstream compound fertilizer plants to purchase some ammonium chloride to replace urea. However, from the supply and demand situation of ammonium chloride, relying on urea is difficult to alleviate its weak market in the short term. The price of the main product soda ash has significantly fallen, but from the perspective of double ton prices and profits, the production enthusiasm of the enterprise is still high. According to statistics from Zhongfeiwang, the overall industry operating rate of Lian Alkali Enterprise has reached 90%, and there is currently no expectation of a decrease. The inventory level of some enterprises has increased, and the market supply pressure is obvious; However, the demand is weak, and compound fertilizer plants and extruded particle ammonium chloride plants have poor sales, resulting in overall low production. They purchase ammonium chloride on demand, and traders hold bearish expectations for ammonium chloride. Inverted sales have also exacerbated the market's pessimistic sentiment.
But as of now, the overall decline in ammonium chloride has been significant, and there is still a demand gap before and after the Spring Festival. Blindly observing or pursuing bottom prices can also easily miss the best opportunity, after all, we need to consider the possibility of centralized procurement in transportation and downstream markets after the Spring Festival, such as the demand promotion in the highly concerned Northeast region.