SunSirs: The Domestic Urea Market Fluctuated and Declined in December

Price trend

According to the Commodity Market Analysis System of SunSirs, as of December 30th, the reference average price of the domestic urea market was 1,811 RMB/ton, a decrease of 8.56% from the reference average price of 1,981 RMB/ton on December 1st.

Analysis review

Market conditions

This month, the domestic urea market prices have been weak and declining. In the first half of this month, domestic urea prices fell. The supply and demand in the urea market were weak, with a decrease in market supply, weak downstream purchasing enthusiasm, weak market transactions, and a poor trading atmosphere. In the second half of this month, domestic urea prices continued to decline. The increase in urea supply has led to an increase in market inventory. Downstream procurement was relatively cautious, with a focus on low-priced purchases, and there was temoprarily no positive market support.

As of December 30th, the ex factory price of urea in Shandong region was around 1,630-1,660 RMB/ton, in Hebei region it was around 1,700 RMB/ton, in Henan region it was around 1,680 RMB/ton, and in Liaoning region it was around 1,810 RMB/ton.

Supply and demand

In terms of supply, urea supply has been tight and then loose this month, and the market supply temporarily was still acceptable. In terms of demand, downstream procurement was relatively cautious, market trading has decreased, transaction atmosphere was light, and the demand side needed to be improved.

Market outlook

SunSirs’ urea analyst believes that the urea market has been declining recently. As of November 30th, there was a strong bearish sentiment in the market, with downstream low-priced purchases being the main focus, and there was temporarily no positive news emerging in the market. It is expected that the domestic urea market prices will continue to operate to be weaker in the short term.

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