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China urea companies continue to fail and the market decline slows down

Views:13     Author:Site Editor     Publish Time: 2021-04-21      Origin:Site

Since the end of March and the beginning of April, when the domestic urea market was about to weaken, news came from the printed label that the total amount issued this time was reduced by one-third compared to the rumored total, which undoubtedly made the market worse. The domestic urea market quickly entered a downward trend, but the downward trend was limited when the upstream manufacturers’ inventories, social inventories and end-user inventories were low. In the later period, due to the continuous failure of enterprise equipment, the decline in the market slowed down, partially due to changes in mentality. In the case of centralized stocking, prices fluctuated within a narrow range.

The weekly output this week was 1.046 million tons, last week was 1.0844 million tons, and the weekly output of the same period last year was 1.095 million tons, a decrease of 38,400 tons from the previous month and a decrease of 49 thousand tons from the same period last year. This is still in the case that Jiujiang Xinlianxin's new production capacity of 520,000 tons and Hubei Sanning's new production capacity of 800,000 tons this year. Therefore, the overall supply side is tight in the near future. In this case, if there is a device failure in a region, the impact on the market in the region may be quickly reflected.

Since the beginning of this year, urea has been operating at the lowest level in the past three years due to policy restrictions on production and production changes. Nissan has increased rapidly since February. From mid-to-late February to mid-to-late March, the supply side has been in a loose state. In April, with the increase in equipment maintenance and conversion enterprises, the operating rate dropped. This week, the domestic urea operating rate was 69.38%, a decrease of 3.95% from the previous year, and the operating rate was close to 69.16% in the same period in 2019. In the past two weeks, the domestic weekly average daily production of urea has also been at a low level. According to the latest statistics of Longzhong Urea, the average production of urea this Sunday was 149,300 tons, a decrease of 7,600 tons from the same period last year, which is almost the same as in 2019. The downward operating rate is highly correlated with recent device failures. It is expected that the operating rate will pick up under normal circumstances next week, but it is expected that it will not reach the level of the same period last year in a short period of time.


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