2025 Market Review

Q1: Substitute Demand Drives Urea Prices Higher

In January 2025, rising international natural gas prices drove sustained increases in global urea prices, with potential export profits exceeding 1,000 yuan per ton at one point.

Despite export restrictions on urea during Q1, smooth exports of ammonium sulfate and compound fertilizers indirectly substituted for urea exports, bolstering urea prices.

April 2025: Tightening Signals Emerge for Compound Fertilizer Export Policy

During the first half of the year, substantial growth in ammonium sulfate and compound fertilizer exports temporarily bolstered urea prices. However, rumors began circulating in April that compound fertilizer exports would also face restrictions, causing urea prices to rapidly retreat from their highs.

April-May: Urea Export Policies Drive Market Fluctuations

On April 30, market rumors emerged that urea exports would be liberalized, prompting a swift rebound in market prices that persisted for a week after the holiday.

However, export policy rumors shifted again, fueling market concerns that policies might fall short of expectations and causing prices to drop rapidly.

Mid-to-Late June: Rainfall Triggers Summer Fertilizer Demand

In mid-to-late June, delayed rains finally arrived in the Huang-Huai region, triggering explosive summer fertilizer demand. Urea supply-demand dynamics swiftly shifted from ample to tight, with inventories rapidly depleting and prices rebounding strongly.

September: Export Quota Benefits Exhausted

By September, export quotas were largely depleted, autumn fertilizer demand concluded, yet high production rates persisted. Urea inventories grew rapidly, driving sustained price declines.

Winter Stockpiling Demand Boosts Prices Starting October

From mid-October, winter stockpiling demand kicked in. Compound fertilizer production rates gradually increased, downstream buyers stepped up urea procurement, and a new batch of urea export quotas was approved. These factors combined to drive urea prices higher amid volatility.

Looking Ahead to 2026: Energy Cost Dynamics and Subtle Shifts in Agricultural Demand

The current urea market is navigating an extremely sensitive window period.

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