In June, urea was in a state of twists and turns. Could it come back to life in July

1、 Price trend



This month, the mainstream urea factory price in Shandong Province rose first, then fell and then rose again: the quotation first rose from 1643.33 yuan / ton at the beginning of the month to 1680.00 yuan / ton on June 13, with an increase of 2.23%, and then fell to 1623.33 yuan / ton on June 25, which was 3.37% lower than that on June 13. However, near the end of the month, urea price had a slight rise, and the quotation rose again from 1623.33 yuan / ton on June 25 to 1643 on June 30 33 yuan / ton, up 1.23%, which was the same as the price at the beginning of the month. On the whole, urea market has ups and downs this month, with an upward trend at the end of the month. The urea commodity index on June 30 was 76.43.


2、 Market analysis


From the perspective of upstream and downstream industrial chain, the price of liquid ammonia dropped and then rose. The quotation first fell from 3033.33 yuan / ton at the beginning of the month to 2966.67 yuan / ton on June 11, then rose to 3116.67 yuan / ton on June 21, and finally closed at 3066.67 yuan / ton. On the whole, the price of liquid ammonia rose by 33.34 yuan / ton in June, and the price at the end of the month was 6.69% lower than that of the same period last year;


The price of liquefied natural gas (LNG) rose first and then fell. The price of liquefied natural gas (LNG) rose first and then fell. The quoted price first rose from 2470.00 yuan / ton at the beginning of the month to 2503.33 yuan / ton on June 11, and then dropped to 2450.00 yuan / ton on June 30. On the whole, the price of liquefied natural gas in June fell by 20 yuan / ton, and the price at the end of the month was 27.66% lower than that in the same period last year. Overall, the urea cost support in this month is strong.


PVA 1799 (PVA BF17)

In this month, the quotation of melamine downstream of urea was temporarily stable, which was 5066.67 yuan / ton, and the domestic melamine operating rate was about 55%. The price of melamine was stable, the cost of raw materials increased by 20 yuan / ton, and the production profit decreased.


From the supply side, the actual output of urea in June was 4.6512 million tons (daily average of 155000 tons), up 3.02% year-on-year. However, the operating load rate of domestic gas head urea enterprises was 74.79%, with a month on month decrease of 3.90% and a month on month increase of 1.36%.


From the perspective of demand: in June, there were some agricultural topdressing phenomena in North China and East China, with a slight increase in agricultural demand and a general enthusiasm for stock preparation; while in terms of industrial demand, the market trading atmosphere was not warm and the follow-up of manufacturers’ new orders was fair, and the demand in other regions was general. After the middle of June, the urea market showed obvious signs of weakening, with an average drop of 70-100 yuan / ton on the 24th. On the 20th-24th, some factories increased their orders for the Dragon Boat Festival, and even fell at the rate of 20-30 yuan / ton per day.


3、 Future forecast


In the first ten days of July, the market price of urea may rebound about 30-50 yuan / ton. Urea analysts at the business club believe that after entering July, the continuous rainfall will make the demand of agricultural topdressing in southern China frequent. After the middle of July, the topdressing of corn in Lianghe and other places in Shandong Province began to start, and the compound fertilizer plants began to operate. The industrial demand for low nitrogen and high phosphorus fertilizers began to produce. The demand in July was not pessimistic, and the potential demand remained in the later stage. However, since July, urea enterprises that have been overhauled in the early stage have started operation one after another. It is difficult to be optimistic about the gradually rising operating rate and returning to the daily volume of more than 150000 tons. In addition, the amount of topdressing in summer is far less than that of spring ploughing, and the area of fertilizer used in the downstream is relatively small, and most dealers have prepared fertilizer in the early stage. Therefore, the driving force of urea price upward in July is insufficient. It is expected that the price rebound of urea market will be within 30-50 yuan / ton, and the increase in some regions will not last too long. Urea may not be able to recover from the dead in July.