Urea rose in March, and if it did, take a large factory in Shandong Province as an example. On February 22, the quotation was once as low as 1820 yuan/ton, and on March 10, it started to rise. The quotation lasted from 1910 to 1930 yuan/ton. Large orders and outsourcing can start to talk about 20 to 40 yuan/ton. It can be said that the price of urea is really rising, rising is skewed!
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On March 7, the ex-factory quotation of a large factory in Hebei rose to 1920 yuan/ton, but the previous afternoon the factory was still signing orders at a level far below that price. When the quotation of a factory in Shaanxi Province rose to 1823 yuan/ton on March 7, the quantity of new orders was also very small, but at present, the quotation has reached 1893 yuan/ton, the contrast is obvious.
It can be seen that the urea price increase is true, but the porcelain is not so solid, that is, there is a certain gap between the quotation and the actual transaction. Let’s take a closer look at the reasons for this price increase.
First, the delayed release of agricultural demand is slightly concentrated. Our long-awaited agricultural demand, which was delayed by the snowy and rainy weather in February, was finally released. This is the biggest driving force behind the price increase. It is known that Shandong, Henan, Jiangsu and Anhui all have a part of the end-sweeping agricultural demand for agricultural distributors to replenish, so the urea ex-factory quotation in the main producing areas increased by 60-90 yuan/ton.
Secondly, the demand of industrial plywood enterprises, power enterprises, especially compound fertilizer enterprises is only slightly restrained by the environmental pressure of the two sessions, and there is no obvious shortcoming. For example, as of March 8, the average operating rate of compound mast plants in China has decreased by only one percentage point per week.
Thirdly, the expected production restriction of urea enterprises in Shandong, Shanxi and other places is not obvious, but it is over-exaggerated again, which can not be said, that is, the production restriction plus the delay of the resumption time of gas head urea enterprises, and then the delayed agricultural demand, has brought about the sharp rise in urea prices. Looking carefully, the daily output of two large urea enterprises in Shandong Province has decreased slightly. A small urea enterprise has stopped production and maintenance for half a month since March 1, and the urea enterprises in Lianghe River are basically full. However, in order to adapt to the situation of differentiated urea promoted by the landlords in Northeast China, they also appropriately open more differentiated urea. Naturally, the price of ordinary urea goes up, which is also conducive to the price of differentiated urea going up. During the period of the game, the price of natural gas may rise. The preliminary news is that the result of the game between gas suppliers and gas-head urea enterprises may rise, but the increase may not be too large. Of course, during the game, the time for gas-head urea enterprises to resume production has been delayed again and again. The gas companies in Inner Mongolia and Mongolia opened one after another from 9 to 12 March, and the gas companies in Ningxia and Xinjiang are in full swing. Head urea enterprises may not resume production until the end of March. Taking advantage of daily urea production as expected in our earlier period and not increased to a controllable level, this price increase of urea is feasible and can be sustained slightly.
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Then, let’s see why the price increase is skewed when it goes up.
Previously, we also anticipated that the urea price increase is just in need. First, the low price in the early period awaits to be issued, and the difference between land sales and export price increases. But it is not a long-term solution. It is true that the urea gap is not so large. In the long run, the supply will increase significantly sooner or later, and the downstream will soon be restless, fearing that it will become the last one to take over the market. After a slightly larger increase, this kind of worry will arise. It is more obvious that the factory price of most urea enterprises is 150-200 yuan/ton higher than the cost. It can be seen that the price increase is not a skewed increase, but a probable result after the price increase.
Finally, we should continue to operate cautiously. When urea prices rise, don’t be too aggressive. When urea prices fall, don’t wait to hit the bottom price all the time. Timely entry is the best policy.
| POLYVINYL ALCOHOL |