Recently, the nitrogen fertilizer market has been in a state of decline, with prices of small nitrogen fertilizers such as ammonium chloride and ammonium sulfate both decreasing. Urea, on the other hand, seems to have been in a slump since the dust settled on export policies. Urea production companies have maintained high production loads, but demand has not achieved the expected results. Prices have shifted from a stalemate to a continuous decline in recent days. If prices continue to drop in this way, it will be a big deal. It will be difficult for the autumn market to seize the opportunity, and the compound fertilizer market may also come to an abrupt end

The mainstream ex factory prices of urea in some major production areas have gradually fallen below 1800 yuan/ton, and high priced enterprises are under pressure to sell their goods. Due to the weakening demand, there should be a trend of high prices filling in the decline. According to China Fertilizer Network, the mainstream ex factory price of urea in Shandong is currently around 1770-1840 yuan/ton. The receiving price of urea at Linyi Compound Fertilizer Plant has dropped to around 1800 yuan/ton, and the mainstream ex factory price of urea in Shanxi is around 1720 yuan/ton; From the perspective of market sales, the wholesale price in some areas of Jiangsu and Anhui is around 1820 yuan/ton, with a significant decrease, while the wholesale price in some areas of Henan is around 1850 yuan/ton. Is there still room for the price to fall in the absence of easing supply and demand contradictions?

Not to mention the abundant supply of urea, the surplus has gradually become apparent, especially after the demand enters the off-season in the later stage, the pressure will be even more severe. According to statistics from China Fertilizer Network, the daily production of urea is currently just over 200000 tons, which is a normal state. There are maintenance companies preparing to resume production, as well as sporadic parking companies preparing to resume production. Overall, there is little change in supply. In addition, the liquid ammonia market is weak, and although prices have fluctuated, they are at a relatively low level. The cost pressure on enterprises is high, and some enterprises have low production enthusiasm, lacking support for urea in their production focus; It is reported that some urea companies have some inventory for sale recently, and downstream large and medium-sized traders also have some inventory sources.

The opposite of supply is light demand. The demand in agriculture is relatively weak, and the overall progress of goods delivery is slow, especially with urea prices in a downward trend. Downstream distributors and grassroots markets are hesitant, cautious and cautious, and mainly purchase according to demand; The delivery progress of compound fertilizer factories in the industrial sector is still not ideal. Under the dual pressure of high inventory and high costs, most small factories are forced to shut down, and the overall operation of large factories has dropped to less than 40%. In addition, the low price of ammonium chloride, a small nitrogen fertilizer, has a significant advantage over urea. Therefore, it is inevitable for some compound fertilizer factories to purchase ammonium chloride instead of using some urea.

In addition, from the perspective of cost and futures market, the price of raw coal is running at a low level, and the cost pressure on urea enterprises is not significant; The futures market continues to fluctuate, which has a certain impact on the sentiment of the spot market. Furthermore, there is the export performance of urea. Recently, urea exports have maintained a steady pace. From the perspective of domestic policies to ensure supply and stabilize prices, the boost effect of exports on the domestic market is relatively limited.

Overall, there are mixed positive and negative factors in the urea market, and some companies have a bullish sentiment. The overall market still shows a weak trend, and there may be room for some prices to loosen or fall.