SunSirs: Liquid Ammonia Prices Rose Sharply (July 21-25)

Price trend

Domestic liquid ammonia prices rose last week (July 21-25). According to the SunSirs’ Commodity Market Analysis System, prices in Shandong Province saw an 8.66% weekly increase. This was primarily due to tight supply as many plants underwent maintenance amidst stable downstream demand. As of July 25th, the mainstream price of liquid ammonia in Shandong was between 2,400 and 2,550 RMB/ton.

Analysis review

On the supply side, last week, supply remained generally stable, though some plants were still undergoing maintenance, resulting in a decrease in supply. Furthermore, supply pressure remained relatively low in Shandong, Hebei, Anhui, and the Hubei and Hunan regions. From midweek to the weekend, companies saw a series of price increases, with manufacturers increasing prices by 100-200 RMB/ton last week. This suggested a slightly tight market.

On the demand side, downstream demand saw little improvement. Compound fertilizer production capacity utilization remained low, and demand for urea remained rigid. Urea prices declined last week, falling 0.4%. However, demand for phosphate fertilizers increased in the Hubei and Hunan regions, leading to a slight improvement in agricultural demand. Furthermore, domestic industrial demand, coupled with declining inventories due to early consumption at ammonia plants, had supported ammonia prices. Manufacturers were clearly willing to maintain prices, which helped to support ammonia prices.

Future outlook:

Analysts of SunSirs believe that the rise in liquid ammonia last week was mainly due to the positive factors on the supply side. Although there was improvement on the demand side, the increase was not large. However, with the expected resumption of work of maintenance equipment in the north next week, the tight supply may improve, which will to some extent dilute the positive factors of increased compound fertilizer production. Taking all factors into consideration, it is expected that the price of liquid ammonia will maintain fluctuations in a range.

If you have any inquiries or purchasing needs, please feel free to contact SunSirs with support@sunsirs.com.