On the evening of July 25, India released a new round of urea import bidding, which finally ushered in the price landing after nearly half a month of twists and turns. A total of 23 bidders, the total supply of 3.382,500 tons, the supply is more adequate. The lowest CFR price on the East Coast is $396 / ton, and the lowest CFR price on the West Coast is $399 / ton. From the price alone, the personal feeling is still OK.

First, simply reverse the price in China, the freight from China to the East coast is 16-17 US dollars/ton, the profit of traders is removed, etc., and the estimate of China FOB365-370 US dollars/ton (for reference only). Then calculate the domestic factory price, taking Shandong area as an example, excluding port miscellaneous, freight, other costs are estimated not to exceed 200 yuan/ton, and pour out the factory about 2450-2500 yuan/ton. As of August 9, the mainstream factory transactions in Shandong region 2400-2490 yuan/ton, the price just covers this range.

But the price can not be said to be flat with the domestic, but since late July several rounds of bargain purchasing behavior, most of them are lower than this price level, so it is also a good news for the country. So how should the domestic market develop next?

Let’s look at the number of bids

According to the statistics of all aspects of the market, the current supply of goods for printing standards is as little as three hundred thousand tons, and more than seven hundred thousand tons, which are either in the manufacturer, or in the port, or in the social warehouse, or there are some empty orders. If all can go out, and even need new procurement demand, for the domestic in late September can also appear new support, together with other domestic good, staged market. However, if the amount of participation does not meet expectations, there may be a certain degree of negative impact in the short term, after all, the current domestic fundamentals are weak.

Wait for time to bring demand

Of course, the price is considerable, domestic exports can be a large number of good news, but from July to date, the positive role has been digested for the most part, with the export orders one after another, waiting for shipment in the process, the next to have domestic demand debut relay.

As far as agriculture is concerned, in the autumn fertilizer market in September and October, there will be a small amount of fertilizer demand in the mainstream region. In terms of industry, plate production with the end of hot and rainy weather in summer, the arrival of gold and silver, production will be improved, and urea demand may also increase; Another big industrial demand increment compound fertilizer, referring to previous years have at least a month of production peak, this year due to the high risk of urea prices, the trend is unstable, the production of compound fertilizer has been delayed compared with previous years, urea although there are also low in the recent purchase behavior, but the overall urea inventory is still low. Therefore, with the passage of time, the seasonal cycle is approaching, and the industrial and agricultural demand is expected to increase, which will support the market in stages.

Keep an eye on supply variables

Exports are coming to an end, and domestic demand will take time to bring about, so it depends on the change in supply. The continued high price brings about the ultra-high Nissan operation, and many planned maintenance companies have repeatedly postponed the maintenance time, so the daily output has been running at more than 170,000 tons, which is around 140,000 tons in the same period, and the daily output is 20-30,000 tons, which also makes sufficient preparations for exports. The negative impact of sufficient supply has always existed, but the next thing we need to pay attention to is the time for planned maintenance companies to postpone parking, and then the time for three sets of new production capacity to be put into operation in August and September, which will directly affect the change in the size of supply.

China urea industry Nissan chart

Therefore, comprehensive analysis, the positive continuation of the printing label, but also the number of the landing of the other boot. Although there is a certain increase in domestic demand is expected, but the ability to chase high is limited, under the visual impact of sufficient supply, the domestic urea market will still return to the basic logic from the impact of exports. Under the role of exports, transportation, ports, demand, supply, etc., the stage market continues, but the long-term trend is still biased to the lower probability.