Views: 1 Author: Site Editor Publish Time: 2024-07-11 Origin: Site
Market suspension before India tender
The upcoming urea bidding in India, the lack of spot supply, and an important holiday in the United States have jointly suppressed trading activity in the market this week, and prices have remained stable.
The supply and demand in the region east of Suez remain tight, the prices of prilled urea and granular urea in Saudi Arabia are around $350 per ton, slightly higher than some people's expectations. Kaltim Indonesia has launched a bidding process for the sale of large granular urea, which will be closed on July 5th. At the same time, a trading company sold 20000 tons prilled urea to Sri Lanka.
The production of urea in Egypt will recover soon, and there are six producers at least will restart their production facilities from July 2nd due to the availability of natural gas supply. Other North African producers have also taken advantage of the supply interruption. In the earlier this week, the offshore price of large granular urea in Algeria was around $380 per ton.
To the west of Suez, the price range for granular urea in Brazil has been expanded to a landed price of $355-370 per ton. The price of American barges has dropped to around $288-302 per ton offshore from Nora.
The market factors
Recovery of urea production in Egypt: Egyptian producers resumed their factory production starting from July 2nd, with Abu Qir, Mopco, Helwan, and Kima, Alexfert, and NCIC restarting their facilities on July 3rd.
The urea inventory in India remains stable: as of June, the national inventory in India may be around 11 million tons, lower than the 11.3 million tons at the end of May.
Outlook for 30-60 days: Downward risk outweighs upward risk
Considering the current overall tension, prices may rise in short term, which may be driven by some last minute purchases from Australia and Southeast Asia. However, India's bidding has a habit of being unexpected. The tight supply will eventually ease from August, as India has sufficient inventory and crop prices are putting pressure on people's burden. Natural gas prices in Europe have also slightly decreased.
