According to China Chemical News, domestic urea prices rose across the board last week. The increase in urea futures prices and heightened enthusiasm for fertilizer stockpiling in the Northeast market both boosted urea prices, with market trading sentiment showing a marked improvement. By last Friday, ex-factory prices for urea in northern regions (excluding Shanxi, Northeast, and Northwest) ranged from RMB1,580 to 1,620 per ton (all prices per ton unless specified otherwise). Low-end prices at Shanxi plants hovered around RMB 1,500 . Xinjiang urea plants mostly maintained stable pricing, with minor downward adjustments at some facilities, resulting in ex-factory quotes between RMB 1,320 and 1,520. Small and medium-sized granular urea plants in Jiangsu and Anhui reported ex-factory prices between RMB 1,600 and 1,680 , with higher quotes concentrated in Jiangsu. Market prices in Guangdong and Guangxi ranged from RMB 1,740 to 1,770. Last week, mainstream wholesale prices for domestic urea settled between RMB 1,640 and 1,770.

On the supply side, domestic urea daily output continued to rise last week, averaging approximately 202,000 tons. This represents an increase of about 2,100 tons week-on-week and 14,600 tons year-on-year, with an average operating rate of around 85.3%.

Industrial demand remained robust, with Northeast China's compound fertilizer plants maintaining strong buying enthusiasm for large-grain urea for winter stockpiling, providing solid support to the domestic market. Other downstream sectors like plywood and melamine plants continued purchasing on an as-needed basis, exerting relatively limited upward pressure. Nationwide compound fertilizer plant operating rates reached approximately 33.98% last week, up 2.86% week-on-week and 1.38% year-on-year.

Agricultural demand: Last week, the domestic agricultural urea market remained in its off-season. However, driven by a “buy on the rise, not on the dip” mentality, regional agricultural distributors showed increased enthusiasm for stockpiling, with winter storage inventories gradually rising. The next peak urea consumption season will be the spring wheat regreening top-dressing period. Prior to that, limited fertilization demand exists in areas like Jiangsu around the Spring Festival for winter-winter fertilizer application.

Inventory-wise, domestic urea plant inventories continued to decline last week amid favorable shipment conditions and increased advance orders, alleviating inventory pressure for some plants. As of last Friday, domestic urea plant inventories stood at approximately 1.444 million tons, down about 3.86% week-on-week and 1.16% year-on-year. Last week, urea market inventories in Guangdong and Guangxi regions totaled around 120,000 tons, down approximately 22,000 tons year-on-year.

Internationally, the urea market showed subdued performance overall last week. On November 20, India's Potash Corporation of India Limited (IPL) received bids from 24 suppliers for its urea import tender. The lowest bid on the East Coast was $418.4 per tonne CIF, with a total tender volume of 2.26 million tons; the lowest bid on the West Coast was $419.9 per tonne CIF, with a total tender volume of 2.46 million tons. Prices were slightly below market expectations, with the East Coast price equivalent to $394-396 FOB for Chinese urea exports. Reports indicate robust domestic demand in India, with market sources suggesting India may launch another round of urea import tenders by late December.

Following a recent upward trend, high-end transactions in China's domestic urea market have slowed slightly. However, as many urea plants have prior low-price prepaid orders pending shipment, they are expected to maintain firm pricing in the short term. Without additional positive support, the urea market may undergo a corrective consolidation phase, though the lower price range is likely to be higher than previous levels. Market attention will focus on China's urea supply volume to India and the impact of urea futures price movements on market sentiment.

As an integrated internet platform providing benchmark prices, on November 26, the benchmark price of urea from Business Society was 1655.00 RMB/ton, an increase of 2.95% compared with the beginning of the month (1607.50 RMB/ton).

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