On the eve of the Spring Festival in previous years, urea may have remained stagnant or received orders at reduced prices. This year, the situation is different. In the first half of the month, urea in some regions did not decrease but instead increased, and sales were relatively good. In recent days, as the Spring Festival approaches, urea prices are still fluctuating slightly, and urea factories in Shaanxi and other places are still slightly increasing in prices. This shows that there is still sales in the urea market. Although the recent sales volume is not large, the market has not completely stopped, which is also a good thing, After the Spring Festival, the demand for winter wheat top dressing in some regions will gradually start, and there may be a slight increase in urea driven by agricultural demand. There is still hope for the market.

The urea market seems to be more optimistic than worried, with hope in the future. However, the ammonium market is not as optimistic, and even after the Spring Festival, it is difficult to have a significant turning point. Recently, it was learned that the low-end factory quotation for 55% powdered ammonium in Hubei is 2900 yuan (ton price, the same below), which is quite surprising. In the current ammonium market, any low price may occur, and recent snowfall in some provinces has caused transportation obstacles. The price reduction of ammonium in order to sell goods is not accidental. So, what is the market situation for ammonium nitrate? The specific situation is as follows.

Firstly, hard demands still exist, but they are relatively scattered. Downstream procurement has basically come to an end before the Spring Festival, and the demand for ammonium may not improve immediately after the Spring Festival. The prices of grain and agricultural and sideline products are relatively low, and grassroots farmers have poor enthusiasm for purchasing fertilizers. Composite fertilizer enterprises have a large inventory of finished products, and sales are not ideal. Therefore, the enthusiasm for purchasing raw materials is not high, and some large factories have purchased guaranteed ammonium, so they are not eager to make new purchases. Although small and medium-sized compound fertilizer enterprises have a shortage of raw materials, they will not accept higher priced raw materials, so they will only purchase at suitable prices.

Secondly, although the operating rate is not too high, inventory pressure is gradually increasing. During the Spring Festival, there will be production restrictions or shutdowns by enterprises, and the overall operating rate of ammonium will be around 50%. However, due to the unsatisfactory demand for ammonium in recent months, enterprises have accumulated a certain amount of inventory, resulting in fewer new orders and only a small amount of purchases in the surrounding areas. This gradually increases the inventory pressure on enterprises, and later sales will be somewhat passive.
Once again, under poor demand, the raw material market is currently unable to provide favorable support for ammonium nitrate. About half a month before the Spring Festival, the price of sulfur did not decrease but instead increased, with a considerable magnitude. It was only in the past week that the price stabilized. However, the decrease in sulfur in the early stage was a bit large, which had a certain impact on the cost of ammonium. If various markets start slowly after the Spring Festival, there is still a possibility of a downward trend in sulfur. After the Spring Festival, the mining restriction period for ores may end, and in recent years, the import quantity of phosphate ores has increased, so there is a possibility of stable or slight decrease in ore prices.

In summary, there are many bearish factors for ammonium nitrate, and the market may not be very good after the Spring Festival. However, there is still strong demand, but the price will not be too optimistic.