Market Overview: Mixed Price Movements Across Regions
The China domestic urea market on July 8, 2025 exhibited divergent price trends, with adjustments ranging from -60 to +30 yuan/ton across different provinces. This comes amid weak demand fundamentals and ample supply conditions, with daily production maintaining at approximately 19.63 million tons and operating rates around 83.52%.
Key characteristics of today’s market:
-
Eastern regions (Shandong, Jiangsu): Prices remained stable to slightly weaker, reflecting subdued industrial demand
-
Northern regions (Shanxi, Shaanxi): Saw modest increases (10-30 yuan/ton) due to temporary logistics constraints
-
Southwestern regions (Sichuan): Experienced sharp declines (-60 yuan/ton) from inventory pressure
-
Northeastern regions (Heilongjiang): Prices dropped 20 yuan/ton following reduced agricultural activity
Regional Price Breakdown (July 8, 2025)
Northern China
| Region | Price (yuan/ton) | Change | Notes |
|---|---|---|---|
| Shandong | 1,760-1,820 (small-med granules) | ↓20 | Linyi delivery at 1,820; Heze at 1,800 |
| Hebei | 1,760-1,770 (small granules) | Stable | Shijiazhuang delivered at 1,750-1,760 |
| Shanxi | 1,680-1,720 (small-med) | ↑10 | Large granules at 1,810-1,830 |
| Shaanxi | 1,640-1,730 (small-med) | ↑30 | Xianyang delivery at 1,750 |
Central & Eastern China
| Region | Price (yuan/ton) | Change | Notes |
|---|---|---|---|
| Henan | 1,750-1,760 (small-med) | Stable | Shangqiu delivery at 1,810-1,820 |
| Jiangsu | 1,800-1,900 (small-med) | Stable | Premium for industrial-grade urea |
| Anhui | 1,780-1,820 (small) | Stable | Limited trading activity |
Southern & Western China
| Region | Price (yuan/ton) | Change | Notes |
|---|---|---|---|
| Sichuan | 1,720-1,760 (small-med) | ↓60 | Significant inventory pressure |
| Guangdong | 1,870-1,890 (small-med) | ↓10 | Weak monsoon demand |
| Xinjiang | 1,500-1,600 (N. small) | ↓10 | South Xinjiang at 1,600-1,720 |
Market Drivers & Analysis
1. Supply-Demand Imbalance
-
Production levels remain high at ~19.63M tons/day, keeping markets well-supplied
-
Industrial demand from resin and adhesive sectors has softened due to seasonal factors
-
Agricultural demand remains tepid, with compound fertilizer plants showing preference for alternative nutrients
2. Cost & Logistics Factors
-
Coal prices have stabilized, removing upward cost pressure
-
Regional logistics disruptions in Northwest China temporarily supported Shanxi/Shaanxi prices
-
Inventory buildup in Southwest led to aggressive discounting (Sichuan -60 yuan/ton)
3. Futures Market Influence
Urea futures showed mixed signals:
-
Main contract (UR2509): Opened at 1,745 yuan/ton, settled at 1,757 (+11 yuan, +0.63%)
-
Market sentiment: Analysts expect continued range-bound trading (1,700-1,800) in near term
Price Outlook & Key Considerations
Short-Term Projections (Next 7-10 Days)
-
Eastern/Northern China: Likely to maintain stable-to-weak trends (1,750-1,850 range)
-
Southwestern China: Potential for further corrections if inventories remain high
-
Export Markets: Quota policies will be critical for price direction
Factors to Monitor
-
Monsoon progression – Impacts agricultural application timing
-
Coal price movements – Key for production cost structure
-
Industrial activity recovery – Especially in resin/plastics sectors
-
Government stockpiling – Potential support for prices
Conclusion: Cautious Market Awaiting Clear Signals
The July 8 urea market reflects typical mid-season characteristics – adequate supply, fragmented demand, and regional price divergence. While some northern areas saw modest gains from logistical factors, the broader trend remains weak-to-neutral, with markets awaiting clearer signals from:
-
Autumn fertilizer preparation schedules
-
International price movements
-
Policy developments on export quotas
Traders are advised to maintain flexible inventory strategies, while producers may consider output adjustments to prevent regional oversupply situations from worsening. The next pivotal period will emerge as compound fertilizer plants finalize autumn production plans in late July.
