The ICIS weekly Urea reports are covered in China, Europe and the US as well as globally in The Market report. For China, there is an extensive coverage of export, ex-works and ex-warehouse prices, and the Europe report concentrates on spot prilled and granular grades in Yuzhny, Baltic, Middle East and northwest Europe, while the US has spot quotes for the US Gulf and Arab Gulf. All these prices assessments are supported by an independent market commentary that includes details of production news, exports, regional updates, demand and supply and any other key influencing factors. This reliable market intelligence can help you to make informed commercial choices.
Updated to Q3 2019
Asia
Chinese exports increased as prices rose globally in August. China exported around 850,000 tonnes of urea in the 1 July Indian tender, for shipment by mid-August. Any tightness in Malaysia because of a maintenance at the granular urea plant in Sipitang was met by higher exports from China. Indonesian availability was largely uninterrupted with Kaltim holding regular export tenders. Domestic production in India was lower with a new plant only making up for lost production.
Indian urea demand was higher than expected with MMTC issuing two tenders during the quarter and purchasing over 2.6m tonnes via tenders. Domestic demand in the country has been high because of rainfall at a 25-year high. Purchase tenders from Sri Lanka, Nepal and Bangladesh were also seen although southeast Asia buying was limited mainly to contract deliveries.
Europe
India coming to the market in the third quarter meant that north African cargoes looking to find a home, particularly in Europe, were redirected to India. The third quarter is typically the slowest period in the European fertilizer calendar as farmers are focused on harvest rather than fertilizer stock levels.
Demand is typically at its lowest during the third quarter, this is because farmers are harvesting crops rather than focusing on buying fertilizers. Demand is also slow from the industrial sector, since many manufacturers take the quieter holiday period to plan maintenance. The Mediterranean was particularly slow during the peak July and August holidays. EU legislation relating to urea and its ammonia volatilisation, harming health and natural ecosystems, is also impacting on demand.
US
There was no shortage of supply because demand the previous quarter had been below par owing to river flooding and poor conditions for the farming community. This meant the window of application narrowed because of the reduction in planting, which meant availability was plentiful.
Demand improved for second dressing because spring application was much lower than in previous years owing to the poor weather across the Midwest. Demand upriver was better than expected because logistical problem in New Orleans meant that barges could not get upriver in time for application.
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Nitrogen (N) fertilizers are produced chemically using natural gas and hydrogen that is contained in the air. Ammonia is produced by mixing nitrogen and hydrogen gases in the presence of heat, pressure and a catalyst compound.
Urea is the most widely-produced and commonly-traded nitrogen fertilizer. Production amounts to more than 140m. tonnes a year, of which about 30m.
Urea occurs as white hygroscopic crystals, which are either odourless or have a slight smell of ammonia. Urea is not considered to be harmful at normal temperature, but the dust may irritate the skin, eyes and nose.
The major outlet for urea, accounting for nearly 90% of total consumption, is as a fertilizer. Urea is also used in the manufacture of urea-formaldehyde resins, the synthesis of melamine, in adhesives and paints, and for laminates, moulding compounds, impregnating paper and textiles.
Urea is widely traded on international fertilizer markets. There are two main hubs in urea trade – the Black Sea and Arab Gulf. These flows are said to determine the global urea prices.
Urea production involves a two step process where the ammonia and carbon dioxide react to form ammonium carbamate which is then dehydrated to urea. In the process, ammonia and carbon dioxide are fed to the synthesis reactor which operates around 180-210oC and 150 bar pressure.
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