This week, the raw material sulfur has risen again, with ammonium manufacturers mainly following suit and diammonium temporarily maintaining stability; The rise of potassium chloride in ports and border trade in mid to early November has been slightly stable to this day. Some say it has dropped a bit, but in fact, the actual transaction price is already like this, so it cannot be said to have fallen. Phosphorus and potassium have both seen significant increases, with ammonium prices relatively high and potassium fertilizers rising to relatively normal levels. The industry is increasingly expecting urea to rise to stimulate the start of winter storage. The fertilizer market is delicate, and it is rare to see such a situation where phosphorus and potassium prices rise first.

Urea is indeed a bit of a rising trend to join the fun. On the one hand, although the price reduction and order taking effect last weekend/early this week was average, the stock market was a bit hot, which drove urea futures to rise. Urea manufacturers took the opportunity to rise and support the market. On the other hand, the 2024 National Chemical Fertilizer Commercial Reserve Training and Exchange Conference was successfully held in Chengdu on November 19. Urea manufacturers have some expectations for light storage and storage, and if there is no increase at this time, when will it be!

Let's talk about the price increase of urea. That's right. Since the beginning of the week, the factory price of urea in Shandong and other places has increased by about 20 yuan/ton, and some manufacturers are temporarily stable and preparing to follow suit. Let's say urea is stable, it seems to be okay. After the price increase, the new orders from urea manufacturers slowed down, mainly due to the lower enthusiasm of downstream customers for receiving goods. These customers can only take the opportunity to sell more goods, persist for a few hours, and persist day by day.

There are too few points to discuss about the fundamentals of urea supply and demand. The daily production of urea is at a high level, about 185000 tons. Some plants in Henan, Hubei, and Shaanxi will resume production in the future. At the end of November, urea manufacturers in Inner Mongolia and Qinghai may shut down for winter maintenance. In mid December and later, Sichuan and Chongqing gas manufacturers will also enter the winter shutdown and maintenance period. The expected value in this regard is not high, after all, we experienced a relatively high export volume last year, and the price suitability decreased in mid to late December last year.

The customs have released the latest urea export data, with 3500 tons exported in October and a cumulative export of 257000 tons from January to October, a decrease of more than 3 million tons compared to last year. The release of new urea production capacity and the reduction in exports have stabilized or even slightly reduced domestic industrial and agricultural demand, and the situation of oversupply is generally difficult to change.

Non expired cash dealers have been intermittently purchasing goods, and industrial and agricultural customers have also made some purchases. Some urea manufacturers are under high cost pressure, and roughly speaking, they may lose tens of yuan to 100 yuan/ton or more. Based on this, most urea manufacturers are unwilling to lower prices or significantly lower them. The stock market and urea futures are slightly affected, especially when urea futures are hard core and rising, urea manufacturers are very willing to cooperate with symbolic increases.

As time goes by, the progress of urea procurement by the light storage and storage party becomes more critical. The winter storage fertilizer production of compound fertilizer enterprises is important for the rhythm of urea procurement, and whether urea can be exported more is highly anticipated.

Overall, although the industry expects a rise in urea prices, the supply situation is not optimistic, and there is a slight increase in social inventory. Before reaching a truly concentrated consumption stage, everything is unknown. Originally, last weekend the author believed that this round of urea could drop by about 50 yuan/ton, and Shandong and other places may break through 1700 yuan/ton, but it did not come true. In this way, urea manufacturers will continue to expect urea prices to remain stagnant and consolidate, even if the stalemate is weak. When coal prices decrease and demand slightly increases, the worst-case scenario is that urea prices will rise significantly for a short period of time before rebounding.