Urea Fertilizer price and market analysis

Fertilizers are among the major production factors to increase agricultural output. They accounted for approximately 60% of the registered yield increase in the last 50 years. Consequently, if the agricultural sector is to produce sufficient feed and food for the future requirements of an additional 2 billion people by 2050, efficient access to fertilizers is a relevant issue, particularly in the least developed areas. In Africa, closing the gap between actual and potential agricultural yields, which could mitigate food insecurity, depends heavily on improved access to and use of fertilizers

the interplay among fertilizer prices, energy prices  and  commodity  prices. what  extent  food  and  energy  prices  play  a  role  in  fertilizer  price  formation?

All  their  markets  are  interlinked and thus their prices affect each other.

  • Firstly, fertilizers are linked to energy  markets  because  the  main  input  for  their  production  is  oil  and  gas. 
  • Secondly,  fertilizers  enter  as  an  input  into  agricultural  production  and  affect  the  productivity  of  the  agricultural  sector.More  importantly,  the  use  of  fertilizer  increases  as  the  price  of  commodity  prices increases.
  • Finally, there is feedback from  the  food  market  to  the  energy  market  through  its  demand  for  energy  in  agricultural  production  (e.g.  fuel).

The  exact  causal  relationship  between  the  three markets is an empirical question as it depends on many factors such as the size  of  the  respective  market,  market  structure,  etc.

Urea Fertilizer market analysis

Nitrogen (urea) prices fell 11 percent in the first quarter after large gains in the second half of 2018 .The decline reflected weak Chinese seasonal demand, below-average use in North America due to early snow, and lower input costs (natural gas and coal). These factors more than offset strong import demand elsewhere, notably Brazil. On the production side, stringent environmental policies have led to plant closures and sharp reductions in urea exports from China, the world’s largest nitrogen fertilizer producer. However, this has been offset by capacity additions in India, Nigeria, and Russia. In addition, concerns that the re-imposition of sanctions on Iran by the United States would curtail Iranian supply did not materialize, due to waivers given to China, India, and Turkey (accounting for more than three quarters of Iranian urea exports). Urea prices are projected to remain broadly unchanged in 2019.

Fertilizer Price (2017-2019)  / US dollars

World Bank Commodities Price Forecast (nominal US dollars)

World Bank Commodities Price Forecast (constant US dollars)

Source : Commodity Markets Outlook. Released: April 23, 2019

Quantity of Urea Fertilizer production in the World

Quantity of Urea Fertilizer Consumption in the World

Check Urea Price in other website

The meaningful difference between the price of Iran urea and fob in the Persian Gulf.

According to Petrotahlil, currently CFR Urea price, for the countries such as Brazil is 225$/ton.

but the price of urea in the largest export hub of urea which is Persian gulf, in best situation and India tender is around 245$ FOB. however, in other areas except china urea sale price,is between 240-250.domestic urea price in China is high and around 290$ but There is no definite export and rates declare in this range. in the other hand, rest of region are exporting urea by the price of 235-250$/ton FOB and Imported destinations, delivered urea shipment around 250-260$ CFR.

it is expected that in short time Urea market weakens next month.

at the same time, India couldn’t collect lots of urea and not assigned more than 372,000 tons in India tended in absence of Iran.

On the other hand, Right now Iran can not export it’s urea to India directly, also India didn’t make decision about this matter.

However Iran urea price has meaningful difference with Persian gulf FOB Urea because of logistic and banking sanctions and Bandar Abbas FOB price is around 200-210$ currently. of course exporting price to Neighboring countries always is a little more with lower exporting tonnage, and in Compared with FOB exports, it does not include large quantity.

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