Urea International: rising steadily
Source: Zhongyu information time: January 8, 2021
At the beginning of this year, as last year, the urea market was bullish, and people’s attention is now focused on the market west of Suez.
Since Christmas, driven by the rise in grain prices, the price of barges in the United States has exceeded US $20 per ton because the United States has taken measures to attract spot imports in spring. Brazil’s last-minute seasonal buying this week pushed the price of granular crude oil up to more than $290 per ton. Suppliers benefited from strong market sentiment. Egypt sold forward contracts in the European market FOB $290 per ton, and other sellers raised their target prices.
In the East, it is the decrease of supply rather than the decrease of demand that leads to the rise of prices. The FOB price in Indonesia was US $275.50-278 per ton, a sharp increase over the previous transaction, benefiting from insufficient exports from China and reduced supply from Malaysia.
The price of grain brings us the hope of spring
Wheat and corn prices rose to nearly seven-year highs, boosting US demand expectations in spring and may support further increases in urea prices until spot import demand is met.
Europe and Turkey face rising prices
In the absence of cheaper alternatives, European buyers had to pay high prices for tons in Egypt and Algeria. For Turkey, Iran’s urea production is limited by production reduction.
China will continue to export
China’s urea production is about 120000 tons / day and does not support export. With the approach of the Spring Festival and the arrival of the peak demand in spring, it is expected that there will be no change in the short term.
Outlook:
At present, strong demand west of the Suez Canal will enter Australia and Thailand later in the first quarter. Whenever India’s bidding will increase more support.
