Views: 18 Author: Site Editor Publish Time: 2019-06-10 Origin: Site
Last year's IFA meeting coincided with a very bullish period in the urea market, and it looks like it will be repeated this year, with one major exception. Prices rose by $25-30/ton from 12 months earlier, thus leaving less room for potential increases. Higher prices seem to have a firmer basis.
Offshore prices have risen in most regions this week, reaching $285/ton in the Middle East in July, and in Algeria. Limited new demand was relieved by supply constraints.
Attention will be focused on the timing of India's next bid, potential exports from China, demand from Brazil and the impact of declining us corn cultivation. Short-term projections indicate that the market supply of urea in the third quarter moved from shortage to equilibrium, indicating that urea prices were strong.
Market driven
India: new data show that India needs to buy more urea for Kharif. A new tender for urea is expected in late June and will be shipped in July. Its timing will have a big impact on the market.
United States: It is estimated that corn could grow 7.5 million acres less than in 2018, which will reduce nitrogen fertilizer consumption and increase the potential for urea exports in the United States.
China: The fall in the price of granular urea last week was short-lived. But relatively high international prices are likely to attract more urea exports in July.
30-60 days outlook
The global balance of supply and demand indicates that prices will be strong in the third quarter, mainly buying Eastern Suez and eventually gaining support from Brazil and Europe.
