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 Q2 2021
Asia
Chinese export availability remained tight because of domestic demand. Local prices were attractive and producers focused on these deliveries with food security being another important issue for the government. Plants in Malaysia and Indonesia also underwent planned and unplanned maintenance. In India, a new plant started up with little update on its progress, while another plant is likely to be delayed due to the coronavirus pandemic.
India was back in the market and unable to get its required volume in three back-to-back tenders, even as prices increased with every tender. Domestic demand in China was also strong. In southeast Asia, there was buying activity for May following which importers stepped back due to seasonal factors and as prices rallied above expectations.
Europe
Supply was sufficient to meet demand, but not abundant, given the frequency of Indian tenders. Egypt exported large volumes to Europe, but also supplied tonnes for Latin America. Urea from Yuzhny was also directed towards India, which added to market tightness.
Demand is typically strong in Q2, but this was more pronounced in the quarter because of favourable weather conditions for growers. Buyers were also keen to secure tonnes before India absorbed any surplus. A lack of competitively priced urea out of Iran also meant additional demand for importers, particularly in the Mediterranean.
US
Supply was constant during Q2 with availability at times tight as there was no great uptick in international material as imports remained reduced. One factor in less arrivals was that New Orleans (Nola) values have been at a disparity and have not helped to draw additional cargos.
As crop sowings, and subsequent nutrient applications, advanced over Q2, the amount of domestic demand was on the increase. Favourable crop prices have remained and supported further buying for both primary applications and side-dressing after crop emergence. Improved weather conditions early in the quarter also helped boost the amount of fertilizer consumed.
Updated to Q3 2021
Asia
China is likely to stay away from the export market and focus on the domestic market to keep prices there in check, which is likely to curb exports in the short term. However, the domestic market is set to slow down in late July, following which more material could be available for export, although availability is likely to be limited by low inventory at ports. Plants in Indonesia and Malaysia are also expected to undergo scheduled maintenance.
India is likely to issue an import tender every month as is usual for this time of the year. Demand in India is likely to be robust as the monsoon season is expected to be normal for the third straight year. Southeast Asian demand will also pick up in July.
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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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