The current Chinese small grain urea export price has fallen to $490. This will lead to a significant weakening of urea exports from China! In addition, the Indian Minister of Chemical Industries and Mineral Fertilizers Mansukh Mandaviya recently said that India, as the largest importer of urea, plans to start five new plants in the future to produce a total of 6.5 million tons of urea per year, abandoning imported urea by increasing domestic production. This move, once landed, will pose a great challenge to Chinese urea exports!
Due to the capacity expansion at the beginning of the year, there is an oversupply of urea in the market: this week, downstream demand continues to be low as many producers are still producing large quantities of product, while importers are slow to purchase. So international urea prices generally fell again this week. In most other sales regions, especially Mexico, Southeast Asia and the Middle East, prices fell by about $20-60/mt. Prices in the import market were also generally lower. Brazil fell to $495/mt CFR and the US fell to $491/mt CFR.
The end result is that only a small number of buyers in the market now believe that urea prices are still likely to fall and have therefore postponed their purchases! This led to the price of ammonium sulfate and ammonium nitrate, which also fell this week.
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