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Urea futures prices are high, and institutions are expected to be divergent

Echemi 2021-06-22

Recently, the urea futures price has rebounded after continuously hitting new highs. The main urea contract 2109 showed that the contract rose to 2443 yuan/ton on June 7th, and there were callbacks in several trading days. As of the close of the afternoon on June 11, the contract closed at 2316 yuan/ton. Judging from the overall trend in 2021, the price of the main contract at the beginning of 2021 was 1747 yuan/ton, and then continued to rise, reaching a peak of 2443 yuan/ton, an increase of about 39.8% from the beginning of the year.

Regarding the previous increase in the price of urea, many institutions generally believe that the price of urea is driven by multiple favorable factors, including most domestic companies maintaining zero inventory, a large number of pending orders for companies, and centralized maintenance of some urea devices.


Flush data shows that domestic listed companies engaged in urea production include Yangmei Chemical, Hualu Hengsheng, and Yuntianhua. Yangquan Coal Chemical previously stated on the interactive platform that the operating income of urea products from January to March was 880 million yuan, and the overall profitability of the company's gasification process urea production plant last year was relatively good.


Regarding the recent urea price correction, Founder Interim Futures believes that the domestic urea market has slowed down. Due to obvious downstream resistance and other factors, the market is under pressure and the price has undergone a rational correction.


Ruida Futures believes that looking forward to the market outlook, there are still many device maintenance plans, and the demand is in a period of strong, corporate inventories have dropped to a historically low level, and futures prices are expected to rise after a short correction; however, some institutions believe that the market outlook is expected to be profit-driven Under the circumstances, the operating rate of urea plants will pick up, and the price of urea will drop significantly after the increase in output.

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