Week round up: Urea prices rose sharply this week. At the beginning of the week, market transactions slowed down, market prices were weak, but on Tuesday began to be affected by futures prices significantly up the market, market transactions significantly improved, along with the announcement of printing targets, factories began to receive a large number of port orders, futures also followed by the daily limit and continued to pull up, the market mentality turned positive, factories began to limit or stop receiving orders. Expected to remain high and volatile next week.
This week, after five consecutive weeks of high demand and unexpected supply shortages, urea prices rose another 10-15%. Demand in the Atlantic basin region has grown much faster than in other regions, particularly the US, Brazil, Argentina and Northwest Europe. This week, U.S. urea prices rose $66 / t, Nola's latest barge traded at $463 / t CFR, and Brazilian urea prices showed an unseasonal premium, with its peak price increasing to about $420 / t CFR.
With the exception of the upcoming urea tender in India, demand east of Suez is stable, but overall supply remains tight. China's urea supply appears to be affected, some provinces have slowed the issuance of export permits, small and large particle urea transaction prices increased by about $45 / ton to $380-400 / ton FOB. Southeast Asia in the short term, there is basically no large granular urea available, so traders will look to the Middle East market and order containerized urea at $400 / ton FOB price. Despite the tightening of the ammonium sulfate and ammonium nitrate markets, transacted prices rose again this week at generally lower increases than urea.
Urea prices rose sharply this week under the influence of multiple positive factors. Futures prices began to rise sharply from Tuesday, and in the evening, India issued a new round of tender procurement to further stimulate the market enthusiasm, futures prices directly jumped and pulled up the limit. Export traders also began to find a large area of factories to purchase port sources of goods, resulting in upstream factories broke orders and stopped, and significantly increased the price for three consecutive days. On the supply side, the recent parking maintenance and new equipment parallel, the overall operating rate has not changed much, the Nissan still maintains a high of more than 170,000 tons, and the supply is still sufficient. In terms of demand, the main driving factor of this round of demand is the pull of exports, affected by the continuous rise in international market prices, export profits in domestic and foreign market prices, resulting in a large number of export traders to purchase export port supplies, coupled with India's release of standard purchases to further stimulate the domestic market. However, domestic agricultural demand is basically coming to an end, and continuous high prices have led to further suppression of domestic demand, and many compound fertilizer plants are in a wait-and-see state. It is expected that prices will be mainly high and volatile in the near future.
After a surge this week, the market resistance began to show, especially China's domestic compound fertilizer companies, after not catching up with the market began to wait and see, production plans are also delayed. However, the international market is still hot, export traders are still actively inquiry and purchase, but it is understood that there are relevant departments in the investigation of urea around the port to the station, whether to enjoy the agricultural preferential freight transfer port export situation, and some factories have been clear not to receive export orders, may release a certain signal, will have a certain impact on exports. Next week, we need to focus on the international market price trend and export situation, while the change of futures prices will also have an important impact on the market mentality, if there is no obvious negative factors, it is expected that the price will maintain a high volatile trend.
