This week, the domestic liquid ammonia market continued its previous downward trend, with a sluggish market performance. According to the Commodity Market Analysis System of Shengyi Society, the liquid ammonia market in Shandong Province fell by 2.05% this week (12.22-26). The main reason is the abundant supply of ammonia, which affects market circulation due to rainy and snowy weather in the north. In addition, local environmental inspections still play a role. At present, the mainstream price of liquid ammonia in Shandong region is 2300-2500 yuan/ton.
In terms of supply, this week’s supply continued to increase compared to last week. The production of liquid ammonia in Shandong and Hebei regions did not decrease, while the supply of equipment in Central China resumed, resulting in an increase in ammonia supply. Due to the impact of snow in some parts of the northern region, transportation is restricted, resulting in the accumulation of inventory in enterprise warehouses. From the beginning of the week to the weekend, some companies in northern regions have made downward adjustments, with the magnitude deepening compared to last week. Large factories in Shandong region generally adjust prices between 100-150 yuan, indicating an oversupply in the market. Enterprises still have expectations of resuming work in the later stage, and the supply may continue to increase in the later stage.
From the demand side perspective, downstream demand has been sluggish, with the operating rate of compound fertilizers still at a low level. In some downstream areas, phosphate fertilizer enterprises have been affected by environmental protection, resulting in a continuous decline in operating rates and relatively weak demand. Recently, the shipment volume of urea has remained stable, although there is still an upward trend, the increase has significantly narrowed, but the price has not continued to rise near the weekend. According to the commodity analysis system, the weekly increase of urea is 0.14%. In addition, the domestic industrial demand is weak, and agricultural demand is mainly purchased on demand with sporadic restocking. The improvement in demand is not significant, and the market’s wait-and-see mentality still dominates.
Market forecast:
Business analysts believe that the supply and demand pressure in the liquid ammonia market is expected to continue next week, mainly due to the impact of the expected resumption of plant work, and there are still supply risks in the market. Combined with the current off-season for agricultural demand, the downstream operating rate is slowly declining, and the market for feed ammonia may not improve. There may still be room for decline in the future.