Nanhua Futures(SH:603093) Nan Hua Qi Huo·2025-10-27 03:54Group 1: Report Industry Investment Rating - No relevant information provided Group 2: Core Views of the Report - The fundamental valuation of urea is low. Without further adjustments to export policies, urea will continue to accumulate inventory in the fourth quarter. The short - term internal drive of the industry is weak, and both compound fertilizer and industrial demand are sluggish, so the medium - term trend is weak. The production cost of gas - based enterprises cannot effectively support the price at present. Attention should be paid to whether there will be new export quotas. Macro factors also need to be monitored [2]. - Urea is expected to fluctuate weakly. The operating range of UR2601 is 1550 - 1750. It is recommended to short at prices above 1750 and conduct reverse arbitrage for the 1 - 5 spread when it is above - 10 [12]. Group 3: Summary by Directory Chapter 1: Core Contradictions and Strategy Recommendations 1.1 Core Contradictions - Urea's fundamental valuation is low. In the absence of export policy adjustments, it will accumulate inventory in Q4. Industry internal drive is weak, and demand from compound fertilizer and industry is sluggish, leading to a weak medium - term trend. Gas - based production costs can't support prices. New export quotas and macro factors should be watched [2]. - For the near - term, although new delivery warehouses are added, the cheapest deliverable locations are still Henan and Shandong. With the disappearance of export expectations for the 01 contract, a reverse arbitrage for the 1 - 5 spread is appropriate. The 01 contract still has a premium due to autumn fertilizer expectations [5]. - For the long - term, domestic daily urea production fluctuated between 19.5 - 20.1 million tons around holidays, then dropped to around 19.5 million tons. Inventory increased after the holiday, and demand, especially agricultural demand, is weak [10][20]. 1.2 Trading Strategy Recommendations - Trend Judgement: Urea will fluctuate weakly. The price range of UR2601 is 1550 - 1750. Short at prices above 1750 and conduct reverse arbitrage for the 1 - 5 spread when it is above - 10 [12]. - Basis, Spread and Hedging Arbitrage Strategies: For basis strategies, contracts 11, 12, 01 have a weak unilateral trend, and attention should be paid to when pre - holiday price cuts for order collection increase. Contracts 02, 03, 04, 05 are strong due to peak - season demand expectations. For spread strategies, the upper pressure on the 01 contract is 1710 - 1720 yuan/ton, and the static support is 1550 - 1620 yuan/ton. It is recommended to short the 01 contract at high prices and conduct reverse arbitrage for the 1 - 5 spread. No hedging arbitrage strategy is recommended [13][14]. Chapter 2: This Week's Important Information and Next Week's Events to Watch 2.1 This Week's Important Information - Positive Information: India announced a new round of urea import tenders on October 1st, with the opening on October 15th and the latest shipping date on December 10th. The fourth quarter is the winter storage period for the fertilizer industry, and low prices may attract spontaneous reserves [16]. - Negative Information: Urea daily production has been above 19 million tons this year, and inventory pressure is high. Market confidence is lacking due to falling prices, and downstream procurement enthusiasm is low [17][18]. 2.2 Next Week's Important Events to Watch - On October 19th, Vice - Premier He Lifeng of the State Council agreed with the US to hold a new round of Sino - US economic and trade consultations as soon as possible. The Fourth Plenary Session of the 20th Central Committee will be held next week, and it is an important time - point for the "15th Five - Year Plan" [19]. Chapter 3: Market Analysis 3.1 Price, Volume and Capital Analysis - Domestic daily urea production fluctuated around 19.5 - 20.1 million tons around holidays and then dropped to around 19.5 million tons. Inventory increased after the holiday, and demand is weak. Agricultural demand in Shandong and Henan is postponed due to rain, and compound fertilizer factories have large - scale shutdowns. The impact of previous Indian tenders and export speculation has weakened, and downstream procurement willingness is low [20]. - The weak domestic demand is the main contradiction. It is expected that export growth cannot offset the weakening domestic demand, and the medium - term trend is under pressure. The 1 - 5 spread of urea is in a reverse arbitrage pattern [21]. 3.2 Industry Hedging Recommendations - Price Range Forecast: The price range of urea is 1650 - 1950, with a current 20 - day rolling volatility of 27.16% and a 3 - year historical percentile of 62.1% [28]. - Hedging Strategies: For inventory management, when product inventory is high, short urea futures, buy put options, and sell call options. For procurement management, when inventory is low, buy urea futures, sell put options [28]. Chapter 4: Valuation and Profit Analysis 4.1 Upstream Profit Tracking - The report presents the seasonal data of urea's production costs (fixed - bed, natural - gas, water - coal - slurry gasification) and production profits (water - coal - slurry gasification, fixed - bed) [31][34][36]. 4.2 Upstream Capacity Utilization Tracking - The report shows the seasonal data of urea's daily production, weekly capacity utilization, and capacity utilization of different production methods (coal - based, natural - gas) [40][42]. 4.3 Upstream Inventory Tracking - The report provides the seasonal data of China's urea enterprise inventory, port inventory, Guangdong and Guangxi inventory, and total inventory (port + inland) [44][46][48]. 4.4 Downstream Price and Profit Tracking - The report presents the seasonal data of compound fertilizer's capacity utilization, inventory, production cost, and production profit, as well as the data of melamine's production profit, capacity utilization, and market price in different regions [50][52][56]. 4.5 Spot Sales and Production Tracking - The report shows the seasonal data of urea's average sales and production, and sales and production in different regions (Shandong, Henan, Shanxi, Hebei, East China) [74][76].