The average price to the factory was 905 yuan/ton, down 11.01% year on year. The average price of gasified bituminous coal to the plant was 695 yuan/ton, down 4.92% year on year. The average price of natural gas to the plant of major gas head enterprises was 1.543 yuan/cubic meter, down 11.8% year-on-year. The average electricity price was 0.564 yuan/cubic meter, 3.6% lower than that of the previous year.
According to customs statistics, from January to September 2020, China imported 187,000 tons of nitrogen fertilizer, down 30.3% year on year, and exported 4.045 million tons, down 2.7% year on year. From January to September, The import of urea reached 101,000 tons (in kind), down by 99.5% year-on-year, while the export of urea reached 2.931 million tons, down by 9.5% year-on-year.
According to statistics, the apparent consumption of nitrogen fertilizer in China from January to September 2020 was 27.20.0 million tons (pure), up 2.6% year on year. The apparent consumption of urea was 40.317 million tons, up 3.3 percent year-on-year.
The trend of nitrogen fertilizer market this winter and spring is cautiously optimistic
China nitrogen fertilizer industry association forecast, winter spring cautious optimism nitrogen fertilizer market, the impact of factors, one is the new capacity, shandong ningyang Ming shengda chemical co., LTD. 800000 tons of production capacity was put into operation in August 2020, hubei three ning chemical co., LTD. 800000 tons of production capacity is expected to begin in late November, jiujiang's heart is expected to begin in late December 520000 tons of urea fertilizer co., LTD., Inner Mongolia were ulam group, 1.2 million tons of production capacity is expected to begin the fastest around April 2021. China's urea production capacity is expected to be 68 million tons by the end of 2020.
Daily output will gradually decline. According to the survey on October 27, 2020, the national daily urea output of 146,900 tons decreased by 2.68% compared with the same period last week and increased by 7.82% compared with the same period last week. The daily output of coal head enterprises was 106,100 tons, down 3.01% compared with the same period last week and up 9.56% year-on-year. Qitong's daily output was 40,800 tons, down 1.79% compared with the same period last week and up 3.55% year-on-year. The national urea daily output may fall to the lowest 120,000 tons or so.
Influence of production limit. In the Beijing-Tianjin-Hebei region and its surrounding 2+26 cities, the Fen-Wei Plain, and the Yangtze River Delta region, the production of coal-to-nitrogen fertilizer will be controlled by different levels during the heavy pollution in autumn and winter of 2020-2021. The production capacity of most of the fixed bed intermittent coal gasification units will be reduced by more than 30%. By December 10, all the fixed bed intermittent coal gasification units in Henan will be shut down, involving the production capacity of urea by 2.2 million tons. It is estimated that urea supply in autumn and winter of 2020-2021 will be reduced by about 1.8 million tons.
Business inventories are relatively low. According to the survey of China Nitrogen Fertilizer Industry Association on October 27, 2020, the urea inventory of enterprises in China is about 480,000 tons, with a year-on-year decrease of 320,000 tons or 40%.
Demand is expected to grow. Domestic coVID-19 epidemic control is good, rapid economic recovery, good industrial urea demand • grain prices, increase enthusiasm for grain, agricultural demand is expected to pick up. On August 17, the Rural Development Institute of the Chinese Academy of Social Sciences and the China Social Sciences Publishing House jointly announced that by the end of the 14th Five-year Plan period, there might be a grain gap of 130 million tons, of which the gap of cereals (the three main cereals) is about 25 million tons.
China's demand for nitrogen fertilizer is expected to continue to grow this year
The state reserve of spring tillage chemical fertilizer this year is 10 million tons, the storage time from September 1 solstice to April 30 next year, nitrogen fertilizer accounted for no less than 30%, the winning contractor in the fourth month of the inventory must reach 50% of the reserves. By the end of December, at least 1.5 million tons of nitrogen fertilizer will need to be stored, the vast majority of which is expected to be urea.
Coal prices rallied. According to the survey of China Nitrogen Fertilizer Industry Association on October 27, 2020, the average price of mainstream anthracite to the plant was 929 yuan/ton, down 7.29% from the same period last year. The average price of gasified bituminous coal to the plant was 716 yuan/ton, down 0.97% year-on-year.
Unfavorable factors for export: From 2020-2023, it is expected that there will be about 20 synthetic ammonia plants in the world put into operation, with an increase of 12.6 million tons of production capacity and an increase of 4.6 million tons of nitrogen fertilizer production capacity, which will put pressure on China's nitrogen fertilizer export. The renminbi appreciates. The offshore renminbi rose more than 5,300 points, or 7.4 per cent, from a low of 7.1765 on May 27 to a high of 6.64 on October 21.
Favorable factors: The food crisis will prompt increased agricultural inputs and increased demand for nitrogen fertilizer. According to the latest edition of the State of World Food Security and Nutrition, prepared jointly by the United Nations food and Agriculture Organization and other international organizations, at least 83 million more people are expected to go hungry in 2020, and more than 130 million more may be expected. At least 25 countries around the world are at risk of severe hunger shortages this year, putting the world on the brink of its worst food crisis in 50 years. Indian tenders increase. India has bid 7.69 million tons so far in 2020, up from 490,000 tons last year.
Prices are expected to continue to maintain a steady rise
According to the survey of China Nitrogen Fertilizer Industry Association on October 27, 2020, the average factory price of small-particle urea was 1,632 yuan/ton, down 1.98% year on year. The average factory price of large-grained urea was 1,642 yuan/ton, down 3.47% from the same period last year. Urea price has been rising steadily and is close to the same period last year.
Market forecasts this winter and spring: First, there are still great uncertainties in the global relief recovery under the impact of coVID-19. Weak international energy resources make it difficult for China's coal, gas and electricity to break out of the trend of sharp rise and provide strong support for the price of nitrogen fertilizer. Second, most new production capacity after the spring form effective supply, winter and spring market limited influence; Third, stricter environmental protection policies in winter and spring and low enterprise inventories will lead to a decrease in urea supply compared with last year. In case of extreme weather conditions, supply gap will appear in some areas. Fourth, the new regulations on spring tillage and fertilizer reserve will improve the enthusiasm of the storage units in autumn and winter off-season, which will have a certain support for the market. Fifth, economic recovery will promote the recovery of industrial demand, food security will increase agricultural demand, overall nitrogen fertilizer consumption is expected to continue to increase; Sixth, good news mixed, exports are still uncertain; Seventh, the overall market optimism factor is stronger than the pessimistic factor, the market trend cautious optimism.
