Price trend
The liquid ammonia market in Shandong region was sluggish, with prices fluctuating and falling. According to the Commodity Market Analysis System of SunSirs, the main production area of Shandong experienced a weekly decline of 0.97%.
Analysis review
The main reason was obvious supply pressure and excessive market inventory. Recently, with the resumption of maintenance equipment, the supply side has shown loose performance. Coupled with the increase in urea to ammonia conversion by manufacturers, the supply has significantly increased, and the rise in ammonia volume has dragged down ammonia prices. From the beginning of the week to the middle of the week, prices remained firm, but as the weekend approached, companies were affected by inventory pressure and began to lower prices. Mainstream large factories in Shandong generally lowered their prices by 50-100 RMB/ton. Distributors mainly shipped as low prices. And downstream procurement enthusiasm was not high, agricultural demand was still in the off-season, industrial demand remained rigid, and the overall demand side was bearish. As of June 13th, the mainstream quotation in Shandong region was 2,300-2,400 RMB/ton.
Market outlook
Recently, the agricultural demand market has been in a low season, and industrial demand has followed suit with sufficient supply. However, the supply pressure may partially ease in the later stage. On the one hand, as prices hovered at low levels or supply was tightened in the main production areas of the north, there was an increase in enterprise inspections and price hikes. From the demand side perspective, downstream procurement may continue to be sluggish, maintaining reasonable procurement demand. There is limited room for order growth in the later stage, and industrial demand on rigid demand followed up. Taking all factors into consideration, the performance of liquid ammonia may still be weak next week, and it cannot be ruled out that it may continue to decline.
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