According to the Commodity Analysis System of Business Society, the mainstream market price of urea in Shandong Province fluctuated and fell in December. Urea prices dropped from 2601.67 yuan/ton at the beginning of the month to 2485 yuan/ton at the end of the month, a decrease of 4.48%, and a year-on-year decrease of 8.87% at the end of the month.

On December 28th, the urea commodity index was 115.50, a decrease of 1.32 points from yesterday, a decrease of 24.18% from the highest point in the cycle of 152.33 points (2022-05-15), and an increase of 107.73% from the lowest point of 55.60 points on August 17th, 2016. (Note: The cycle refers to the period from September 1st, 2011 to present)

From the supply side perspective, the mainstream market price of urea in Shandong dropped significantly in December.

Cost side: Upstream market drops significantly

The price of liquefied natural gas dropped significantly in December, from 6556 yuan/ton at the beginning of the month to 5510 yuan/ton at the end of the month, a decrease of 15.95%, and a year-on-year decrease of 9.08% at the end of the month. The price of Yangquan anthracite (washed fast) rose first and then fell, dropping from 1110 yuan/ton at the beginning of the month to 960 yuan/ton at the end of the month, a decrease of 150 yuan/ton. The price of liquid ammonia first rose and then fell, dropping from 3863.33 yuan/ton at the beginning of the month to 3623.33 yuan/ton at the end of the month, a decrease of 6.21%. The highest point was 4056.67 yuan/ton on December 9th, with a maximum decrease of 10.68% within the month. At the end of the month, prices decreased by 21.63% year-on-year. Overall, the upstream market for urea has experienced a significant decline, with insufficient cost support.

On the demand side: The price of melamine fluctuates and rises

From the demand side, agricultural demand has weakened, industrial demand is average, and urea exports are currently not favorable. Agricultural sporadic fertilization. The operating rate of compound fertilizer plants is average, and their enthusiasm for purchasing urea is normal. Board and melamine enterprises generally start construction, with a focus on procurement for immediate needs. The price of melamine fluctuated and increased in December, rising from 7325 yuan/ton at the beginning of the month to 7475 yuan/ton at the end of the month, an increase of 2.05%. From a supply perspective, maintenance companies have resumed production, with a daily urea production of around 180000 tons, indicating sufficient supply.

In the future, the urea market may experience a slight fluctuation and decline in the first half of January. The prices of smokeless coal and liquefied natural gas have dropped significantly, with insufficient cost support. The daily production of urea is about 180000 tons, with sufficient supply. Agricultural demand is average, while industrial demand is predominant. In the future, urea may experience a slight fluctuation and decline.