Price trend

In the first week after the holiday (February 24-28), the domestic liquid ammonia market mainly saw range-bound adjustments. According to SunSirs' commodity market analysis system, the weekly increase in liquid ammonia prices in Shandong was 0.7%. As of February 28, the mainstream price of liquid ammonia in Shandong was between 2,000-2,300 RMB/ton.

Market analysis

From the supply side, supply maintained a steady upward trend last week. Ammonia plants that underwent maintenance before the holiday gradually resumed operations, and liquid ammonia production in Shandong, Hebei, and Henan remained unchanged. Companies primarily offered discounts to move inventory, but with prices close to cost, ammonia plants were also willing to maintain prices. Many ammonia plants switched to other production lines or reduced operating rates, resulting in a lack of upward or downward price movement. In Shandong, most manufacturers saw little price change after the holiday, with companies focusing on actively moving inventory.

On the demand side, downstream demand was slowly recovering. Downstream enterprises were gradually resuming operations after the holiday, but most are purchasing only as needed, with limited large-scale bulk purchases. Operating rates for urea, monoammonium phosphate, and diammonium phosphate had also increased, but compound fertilizer performance was poor. Overall, domestic industrial demand was weak, agricultural demand was based on immediate needs and sporadic restocking, with little improvement in demand, and a wait-and-see attitude still dominated the market.

Market Outlook:

Analysts at SunSirs believe that overall, the domestic liquid ammonia market will likely continue to see a balance between supply and demand in March. While increased operating rates will lead to increased supply, demand will also gradually rise.

Supply is expected to increase, with some ammonia plants still expected to resume operations after experiencing disruptions. However, demand-side support is expected to continue to strengthen. On the one hand, the traditional peak season for agricultural demand is approaching, leading to an increase in agricultural demand. On the other hand, industrial demand will also increase as downstream industries resume operations after the holidays, jointly driving a positive market supply and demand environment.

In summary, considering that the price of liquid ammonia has already fallen to its lowest point and there is a need for market recovery, driven by the marginal improvement in the supply and demand relationship, the domestic price of liquid ammonia is expected to have room to rise in March.

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