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CURRENTLY UREA MARKET

Share | 2016-05-18 17:37:23 From:topfert Comment:0 Look:2485 [ L M S ]

Old Yang Ridicule Market--- Urea to touchthe bottom to be rebound and India tender lack of sincerity

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In late May, domestic urea market trend still a pair ofweakness, factory price is strong on surface, but there are also kickedupstairs. The market ispositiveperiod, just downstream manufacturers are too cautious. Dealer waitand see just due to the terminal market is not active to stock the fertilizer,the defeat psychological shadow after trying to short quotation before.

Obviously prefer to prepare urgently, rather than to advance an amplesupply of goods. Also because of this, the domestic enterprises urea to offerstrong, not only arrange the maintenance actively in May, even some enterprisestake the initiative to limit production insured. Wait for the downstream of theagricultural market under the stimulation of mature factors to quickly start.

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Previous talked market, the author lists several positive factors, the general can be summed up as expected tight supply and demand. According to industry statistics: until mid-May, domestic urea enterprises overall operating rate has dropped to about 65%, and there is the possibility of a further decline. The except for the normal maintenance of the enterprise, there are some small and medium enterprises try converting or exit due to the cost of serious upside down.

Frankly, from late last year to date, domestic urea prices hovering in the 1250~1400 / ton level. at least understanding of the elimination of backward production capacity is ongoing. Although not do more detailed statistics, but more than half of the enterprise feedback from the point of view, overcapacity in the industry has been moderate eased. Look at the upcoming launch of the summer fertilizer market, due to the dealer recently cautious wait-and-see, stock market volume is generally low, the mainstream enterprises urea although not much amount of momentum, but its inventory nor pressure.


So we have reasons to believe that, at present only by domestic industrial rubber and compound fertilizer enterprises procurement support can keep steady price, once you start the agricultural market, compound fertilizer enterprises will also increase the procurement of raw materials. The price of urea will be rise, the centralized procurement of downstream distributors is bound to bring a tightening of supply and demand. As someone to consider the price cycle short, quotes a flash in the pan like expected, the author thinks that this will be determined to the mode of operation of the plant. If we can do "slow up sell", urea, a new round of price cycle is expected to maintain more than half a month


With India MMTC companies during the year the first round on April 25th ended, the industry to the next stage of Chinese Urea Export Situation to pessimistic attitude. Only from the first round of the Indian tender a total turnover of urea 62.5 million tons, consider to China provide FOB 217-218 U.S. dollars / tons of insufficient supply 200 thousand tons, of low-priced exports to offset not only domestic spot even more than half of old inventory also reluctant to compromise.

Eventually India purchased from the Middle East, Iran and other ways together total 60 tens of thousands tons . At this time, a lot of people in the industry speculate that will in the near future re tender after the first round of bidding and hold optimistic attitude. Not unexpectedly, last week/May 12th, STC India released urea import tender, tender on 19th, the offer is valid until 27. Until now, everything seems to be as predicted that development. Next: shipment on July 5, and so on, why not in late June, and planning is not the same!


Remember last week we see the reaction after shipment, can only say that picture is so beautiful but I not dare to see. What is the intentional release of the "smoking gun" of India? Or a trial? Of course, some media expression in India a quarter of agricultural due to rain less, sales than in previous years to reduce about 100 million tons to show the domestic supply and demand is not shortage may even relatively loose. The request shipment in July provide adequate stocking period for the international market. Because of this, before the good trader of the second round of the India tender rapidly "treachery”, and forecast a round of bidding price or will be lower than in previous of 218 million U. S. dollar per ton. Although firms in our country collective statement urea FOB below 230 dollars / ton will not supply, but because the shipping date delay to July, even if China does not participate in, only by Iran, Arab, yuzhny bidding quantity is also expected to get 60 million tons of goods. In fact, India this operation has no need to answer their own whether it is out of stock; bidding is only left for all the traders. However, from another point of view, there are many cases of failure before China short of urea, especially in the first half of the year our country agricultural season. So it is possible to restart the tender of the third round of urea after the failure of this round tender.


To sum up, domestic urea market downturnhas been near the summer fertilizer period, With the current industry capacityutilization rate to supply the downstream  

Centralized procurement, tight supply anddemand has been recognized by the market, with the urea domestic price reboundlater, and the spread between the export will be widened again. So no need topay more attention for the second India round of bidding, after all, hold shortof attitude, bid price does not have domestic reference value. I'd expect morethe third round of the urea tender.


                                                                               From:Chinese business network 

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