Views: 8 Author: Site Editor Publish Time: 2023-07-25 Origin: Site
The most unusual month
July is usually the low point for urea prices in the calendar year, and many of us expect it to be like this in 2023. But collective wisdom has largely failed.
The FOB urea price in Egypt has exceeded S400/t this week for the first time since March, and it is S120/t higher than the low point in June. Other prices have also increased accordingly.
Several factors combined to make a difference in 2023: factory shutdowns in Southeast Asia, Nigeria, and elsewhere have reduced export supply; The agricultural seasons in China and the United States have been extended; The enthusiastic short selling in June had to be overshadowed in July.
Buyers are accepting the new reality slowly, considering the limited spot supply and stable grain prices in August, it seems that prices in September will further rise.
The market factors
Supply shortage: Production losses have reduced export supply, while China's application will be extended until August this year, limiting exports from this source.
United States, Brazil: The system in the United States is empty, and urea prices have been at high levels throughout the summer. Brazil must catch up to ensure that it has the tonnage required for safety.
Grain prices: Russia blocked wheat exports through the Black Sea Corridor this week, leading to a significant increase in wheat prices. Corn prices are also very stable.
Outlook for 30-60 days: firm
Higher prices will bring additional supply, but as we enter August and September, the market will stabilize and demand is expected to strengthen.
