Price trend

This week, the domestic liquid ammonia market continued the downward trend of the previous week, showing a sluggish performance. According to the commodity price analysis system of SunSirs, the weekly decline in liquid ammonia prices in Shandong province was 1.32% this week (January 26-30), a slight narrowing of the decline. The main reason was that, against the backdrop of ample ammonia supply, the festive atmosphere was growing stronger, and downstream industries were gradually suspending operations or reducing production, leading to weaker demand. As of January 30, the mainstream price of liquid ammonia in Shandong province was 2,150-2,350 RMB/ton.

Market analysis

From a supply perspective, supply this week increased compared to last week. Production in the main producing areas in northern China remained stable, with steady ammonia supply in Shandong and Hebei regions. Some plants in Anhui and Jiangsu regions resumed production, leading to increased ammonia supply. Although environmental restrictions led to production cuts in Shaanxi, the large supply from surrounding areas meant that prices in the Northwest and Inner Mongolia regions continued to decline. According to data monitored by SunSirs, major manufacturers in Shandong adjusted prices throughout the week, with price adjustments generally in the 50 RMB range. The market showed an oversupply situation, and companies still had expectations of resuming production later, suggesting that supply may continue to increase in the future.

From the demand side, downstream demand was generally weak. The operating rate of compound fertilizer plants remained low, and some downstream phosphate fertilizer companies in certain regions were experiencing reduced operating rates due to environmental regulations, resulting in relatively weak demand. Urea prices rose this week, mainly due to short-term buying activity from downstream users as the Spring Festival approaches. However, this upward trend may not be sustainable in the long term. According to the commodity analysis system, the weekly increase in urea prices was 1.15%. Furthermore, domestic industrial demand remains weak, and agricultural demand was mainly based on need-based purchasing and sporadic restocking. Overall demand improvement was limited, and a wait-and-see attitude still dominated the market.

Market outlook

According to analysts at SunSirs, the liquid ammonia market is expected to continue facing supply and demand pressure next week, mainly due to the anticipated resumption of production at some facilities, which poses a supply risk. However, agricultural demand may increase, and operating rates for downstream products such as ammonium biphosphate and diammonium phosphate are showing signs of recovery. The interplay between supply and demand is expected to intensify in the later period, and the ammonia market is likely to remain volatile within a certain range.

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