SunSirs: The Pressure of Supply and Demand Increased, and Liquid Ammonia Fell back from a High Level This Week

Price trend

This week (10.17-21), the domestic liquid ammonia market declined. After a sharp rise in September, the market gradually fell from a high level this week. The supply changed from tight to loose. The supply of liquid ammonia in Shandong, Hebei, Hubei, Hunan, Fujian, Southwest and other major production areas increased, and the price also decreased to varying degrees. According to the monitoring of SunSirs, the drop of liquid ammonia in Shandong was 1.82% this week, and the mainstream price of liquid ammonia in this area was 3,900-4,100 RMB/ton near the weekend.

Analysis review

In terms of supply, the supply of liquid ammonia in the main production areas increased sharply this week. Since last weekend, the shipment volume in Shandong, Hebei, Hunan and Hunan, Fujian and other places increased significantly, and with the effect of manufacturers' successive price reductions, the shipment strength increased. Moreover, due to the price of urea was downward, many enterprises had switched to liquid ammonia production. In a short time, the volume of liquid ammonia increased significantly, and the supply pressure increased significantly.

From the terminal point of view, the demand of liquid ammonia downstream was sluggish, and the focus of urea trading moved down significantly. According to the monitoring of SunSirs, urea fell 1.92% this week. As of the 21st, the mainstream ex factory price of urea in Shandong was 2,400-2,500 RMB/ton. The main reason is that the downstream industrial demand weakened, and the operating rate of plates was generally low. In addition, the demand for compound fertilizer declined at the end of the autumn peak fertilizer season, and the agricultural demand entered the slack season. The price of urea dropped from a high level.

Market outlook

Analysts from SunSirs believe that the current market atmosphere is weak due to the increased pressure on supply and demand. The risk on the supply side is still increasing. In the later period, the supply of liquid ammonia of enterprises may only increase but not decrease. On the contrary, agricultural demand enters the slack season, and downstream procurement will continue to slow down. Therefore, the price of liquid ammonia will remain under pressure mainly next week.

If you have any questions, please feel free to contact SunSirs with support@sunsirs.com.