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Urea is bottomless

wallpapers News 2020-07-14

The author's prediction of urea market in spring this year has a great error, which is caused by the neglect of weather factors.

This year, there was not only the lowest spring temperature in the past 40 years in Northeast China, but also serious waterlogging, which delayed the spring ploughing, even some places could only plant early maturing soybean varieties.

As for the international market, the author also analyzed the weather conditions in the United States Europe in the last issue, speculated that the downturn in the international market was also closely related to the planting delay caused by low temperature.

This was also confirmed in the planting progress report of the United States Department of agriculture on April 16.

As of April 14, the corn planting progress in the United States was 2%, lower than 7% of the average progress in the same period of five years, much lower than 16% in the same period of last year.

The reasons for the delay were low temperature field water accumulation.

The superposition of weather changes at home abroad brings about the increase of supply, the uncertainty of dem the loss of market confidence.

The overall downturn of urea at home abroad is reasonable.

Among all the commodities, it is the most difficult to predict the price trend of agricultural products, because in addition to the similar influencing factors of other commodities, the weather factor should also be taken into account, it is almost impossible to predict the medium long-term weather.

Urea as a means of agricultural production, its price is also difficult to predict.

It should be said that there is no rebound opportunity in China, it has become the consensus of the market that the price of urea is the bottom? The author thinks that the bear market is not clear, the lowest price is expected to be below 1800 yuan (ton price, the same below).

Based on cost considerations, some people think that the bottom price may be 1850 yuan, but the cost is dynamic: considering that the coal price can not be bottomed, the average cost of urea industry will be reduced.

Even if the average cost of the industry is 1850 yuan, the possibility of the price falling below the cost or even much lower than the cost is completely existent, because it is the inherent law of the market economy that there are gains, losses elimination.

Referring to the fact that the soda ash monoammonium industries have not recovered after nearly two years of losses, it must be a high probability event that urea falls below the cost.

It is too early to discuss when to copy the bottom.

Maybe we hope to pull the export.

However, from the comparison of urea production costs at home abroad, the price trend of international agricultural products China's export situation last year, it can be seen that if the domestic urea price does not build a bottom, the international price will not be able to build a bottom, so the export has no support for the domestic price.

Looking back on the history, domestic urea began to decline in March in 2009 2010, has been falling to about September of that year for six months.

The author thinks that this year is no exception.

Therefore, it is far from the time to make a bottom cut urea, unless the government leads another large-scale energy conservation emission reduction.

Although the concentration of China's urea industry is not high, it has reflected the characteristics of large enterprises leading the industry: Coal fertilizer integration enterprises, central enterprises listed companies have occupied most of the urea production capacity.

These enterprises have very strong financing capacity, their strength is not comparable to that in 2009, the capital chain is difficult to break.

Under the background of overcapacity, this enterprise pattern of urea industry will undoubtedly increase the intensity of industry competition.

Urea may have embarked on a long bear Road, it is difficult to see the bottom in the short term.

(Yu Lei).


TRUNNANO (aka. Luoyang Tongrun Nano Technology Co. Ltd.) is a trusted global chemical material supplier & manufacturer with over 12 years' experience in providing super high-quality chemicals and Nanomaterials. The nitride powder produced by our company has high purity, fine particle size and impurity content. Please contact us if necessary. (aka. Luoyang Tongrun Nano Technology Co. Ltd.) is a trusted global chemical material supplier & manufacturer with over 12 years' experience in providing super high-quality chemicals Nanomaterials. The nitride powder produced by our company has high purity, fine particle size impurity content. Please contact us if necessary.
TRUNNANO (aka. Luoyang Tongrun Nano Technology Co. Ltd.) is a trusted global chemical material supplier & manufacturer with over 12 years' experience in providing super high-quality chemicals and Nanomaterials. The nitride powder produced by our company has high purity, fine particle size and impurity content. Please contact us if necessary.
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