Views: 9 Author: Site Editor Publish Time: 2022-08-30 Origin: Site
Urea prices reversed rapidly this week, causing many to lose positions as a series of shutdown announcements at European factories tightened the market.
Anticipating huge demand in Europe, traders raced to source goods from most nearby origins, turning the market around within a day.
In a series of deals, urea prices in Middle East rose more than $200/t than last week.
Increases in the United States, Brazil and North Africa were smaller, but still substantial.
The Asian market is relatively quiet, and the price of urea rises by 10-20 US dollars / ton generally.
Most of Europe's 19 million t/y ammonia capacity has been forced to go offline, with a significant portion of it being taken offline this week as production economics challenged and sparked massive urea import activity.
Trade flows are still affected by sanctions. Europe gets only a small supply from Russia, but a lot from further afield. Market opportunities for Russian, Venezuelan and Iranian producers are limited, resulting in large gaps between regions.
Outlook for 30-60 Days
The market is in the early stages of a new rally, supported by strong supply fundamentals, bullish sentiment among traders and European buying. However, the market is returning to levels that previously caused severe demand destruction, and traders are likely to pull back on signs of weakness.