To the end of the month, the domestic urea factory price gradually fell to 1350 yuan (ton price, the same as below).In recent years, the factory price of 1350 yuan has been serving as a benchmark for the bottom rebound of urea.The author thinks, at present no matter from supply and demand, cost or export Angle, bet urea bottom all put risk.

Manufacturers are testing the bottom of the speculation.Since the late October, shandong, shanxi and other main production areas of urea manufacturers continue to strengthen the price bottom, low transaction price stick at 1310 ~ 1330 yuan.Although urea light storage in 2015/2016 is not optimistic in the industry, from time to time some people sing short, more and more domestic traders said to give up light storage, and from the provincial agricultural companies to grass-roots agricultural companies, who is not in the hands of goods in a panic?No matter how efficient and convenient the logistics, it is not as practical as copy the bottom.This manufacturer hype there is no lack of some big companies to support the scene, shandong, shanxi and other places the factory price homeostatic small rise 10 ~ 20 yuan.At the same time, the attitude of downstream dealers to the urea market changed again in the last week: from the beginning of last week's "still fall", to the weekend's "also is stable", and to this week's "not much", it can be seen that the manufacturers bottom speculation has been successful.

There are supply and demand costs.Current supply and demand and cost problems have been the main reason for the low price of urea hovering.Supply and demand, urea market is still suffering from capacity, output "double surplus" test, winter light storage in the risk.In this year's new capacity continues to release and agricultural and industrial demand has been weak under the adverse combination of factors, urea market has continued to decline for a long time.According to statistics, the total domestic production of urea from January to September reached 49.443 million tons, 7.7% higher than that of the same period last year.Overcapacity is not only a time bomb, in such a pessimistic environment, but also contributed to the worsening situation of the industry.

After the end of summer agriculture with fertilizer, the industry predicts that the price of urea in the second half of the year may fall below 1400 yuan.Forecasts are based on supply and demand and on cost.Before the author mentioned that the low price of urea raw coal should cause concern.The ex-factory price of coal used by urea enterprises is only about 800 yuan, almost half of the ex-factory price of anthracite coal two or three years ago, and cheap coal can be purchased in north China, east China and parts of central China.In addition, according to a person familiar with the situation, it is roughly estimated that the cost of urea production corresponding to 800 yuan of smokeless coal is about 1100 yuan. Even if the cost of personnel and equipment loss are added, the total cost of mainstream large urea enterprises can be controlled at 1300 ~ 1350 yuan.

There are at least two criteria for measuring whether urea prices have hit bottom: whether urea plants have been shut down in an environment of overcapacity;Whether the price is seriously inverted to the mainstream cost line below.If neither meets the target, bottoming out is wishful thinking.

There is still talk of urea exports.Last week, the international price of urea generally rose slightly, fob China increased 2 dollars to 250 ~ 252 dollars;Prices for the black sea, yuchny and the Baltic, were up $2 - $6 and $2 - $3, respectively, at $252 and $247.There was news of an eighth round of bidding in October, ahead of the seventh round in India.At this time, the price increase in the international market has no real significance, and it does not mean that China's urea export will regain its voice in the later stage.According to the author's understanding, India's domestic inventory of urea is ok, especially after its own production is encouraged by government subsidies. The external bidding is obviously for the purpose of low price supply, and the specific purchase quantity is difficult to distinguish.In other words, even if the domestic habit of fob urea as domestic sales pricing benchmark, this winter storage is not bottom.

The author is more willing to take the upcoming or ongoing bottoming out as a speculation opportunity, suggest dealers focus on the purchase of large companies, do not underestimate the circulation of the big men speculation ability, of course, also want to act according to their own situation.