According to the Commodity Analysis System of Business Society, the mainstream domestic urea market prices fluctuated and fell in June: urea prices dropped from 2402.50 yuan/ton at the beginning of the month to 2257.50 yuan/ton at the end of the month, a decrease of 6.04%. At the end of the month, prices decreased by 27.25% year-on-year.

On June 27th, the urea commodity index was 104.16, an increase of 0.12 points compared to yesterday, a decrease of 31.62% from the cycle’s highest point of 152.33 points (2022-05-15), and an increase of 87.34% from the lowest point of 55.60 points on August 17, 2016. (Note: The cycle refers to the period from September 1st, 2011 to the present)

From the supply side perspective, the mainstream domestic urea market prices fluctuated in June.

Cost side: Upstream market prices fluctuate with each other

In June, the price of liquefied natural gas fluctuated and increased, rising from 3750.00 yuan/ton at the beginning of the month to 3974.00 yuan/ton at the end of the month, an increase of 5.97%. The price at the end of the month decreased by 32.21% year-on-year. The price of Yangquan Anthracite (washing in quick) fell slightly, from 1160 yuan/ton at the beginning of the month to 920 yuan/ton at the end of the month, down 240 yuan/ton. The price of liquid ammonia has dropped significantly, from 3000.00 yuan/ton at the beginning of the month to 2683.33 yuan/ton at the end of the month, a decrease of 10.56%. The price at the end of the month decreased by 43.78% year-on-year. Overall, there has been a significant decline in upstream urea products and insufficient cost support.

On the demand side: The price of melamine has slightly decreased

From the demand side, agricultural demand has weakened while industrial demand is average. Affected by the mentality of buying up rather than buying down, there is a strong wait-and-see atmosphere in the downstream of urea. Agricultural sporadic fertilizer supplementation, compound fertilizer, board, and melamine enterprises are operating normally, and small orders are mainly needed for procurement. The price of melamine decreased slightly in June, from 7125.00 yuan/ton at the beginning of the month to 6600.00 yuan/ton at the end of the month, a decrease of 7.37%.

Looking at the future market, the urea market may experience slight fluctuations and gains in mid to early July. The price of upstream LNG has a downward trend, the price of Anthracite has consolidated at a low level, and the cost support is general. The daily production of urea is around 160000-170000 tons, and the supply is normal. Corn in the north and rice in the south have good fertilizer use, with increasing agricultural demand and industrial demand being the main demand. Urea may fluctuate slightly in the future.