Price trend

This week (10.14-18), the liquid ammonia market in Shandong was sluggish, with prices fluctuating and falling. According to the Commodity Market Analysis System of SunSirs, the main production area of Shandong experienced a weekly decline of 2.35%.

Analysis review

The main reason WAs that the maintenance equipment had resumed work one after another, and the supply side had shown loose performance. Coupled with the increase in urea to ammonia conversion by manufacturers, the supply had significantly increased, and the rise in ammonia volume has dragged down ammonia prices. From the beginning of the week to the middle of the week, some mainstream large factories in Shandong generally lowered their prices by 100-200 RMB/ton. Distributors mainly underreport shipments. And downstream procurement enthusiasm was not high, agricultural demand was still in the off-season, industrial demand remained rigid, and the overall demand side was bearish. As of October 18th, the mainstream quotation in Shandong region was between 2,500-2,750 RMB/ton.

Market outlook

Recently, the procurement of agricultural demand had slowed down, and industrial demand had followed suit with sufficient supply. However, the supply pressure may partially ease in the later stage. On the one hand, the main production areas in the north were fluctuating or tightening supply due to low prices. On the other hand, the export of liquid ammonia may improve. From the demand side, agricultural demand may be affected by inventory consumption, and there is room for improvement in later orders, while industrial rigid demand followed up. Taking all factors into consideration, liquid ammonia may stop falling next week, and there is a possibility of a price rebound.

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