Report Overview - Report Title: Urea Weekly Report: Strong Supply and Demand, High-level Fluctuations [1] - Release Date: March 30, 2026 - Report Issuer: Guantong Futures Co., Ltd. Investment Rating - No investment rating provided in the report Core Viewpoints - The international urea market is generally in a tight situation, while the domestic supply is relatively abundant after the release of daily production and national reserve supplies. The downstream demand mainly relies on high-nitrogen compound fertilizers from compound fertilizer factories. The future agricultural demand is expected to be concentrated around May and June. Currently, the operating rate of compound fertilizer factories has gradually increased to a high level, and the finished product inventory in the factories has been transferred to the end-users. However, as the spring fertilizer season is coming to an end, the subsequent operating rate may stabilize. Recently, the prices of raw materials have increased to varying degrees. After the increase in compound fertilizer prices, the follow-up of new orders has slowed down, and most of them are based on the execution of previous orders. The inventory in urea factories has significantly decreased, and the de-stocking pattern is expected to continue in the short term. Overall, the international urea price has risen sharply, while the domestic market has only been affected by sentiment and has not seen a synchronous sharp increase. The sufficient backlog of orders supports the spot price, and the market will mainly fluctuate at a high level under the situation of strong supply and demand. If the situation in the Middle East eases, the market sentiment may decline, but currently, it will mainly fluctuate narrowly at a high level during the peak season [2] Summary by Directory Spot Market Dynamics - The urea spot market remained stable over the weekend, with acceptable trading activity. Factories still had pending orders and no pressure to reduce prices to attract orders. The ex-factory prices of urea factories in Hebei, Shandong, and Henan remained stable at 1,810 - 1,840 yuan/ton [5] Futures Dynamics - Last week, the urea futures price was affected by Trump's threatening remarks on Monday and followed the energy and chemical sector up. It opened lower and closed lower on Tuesday, opened lower and closed higher but still ended down on Wednesday, opened higher and closed higher on Thursday and Friday. As of March 30, the main May contract of urea closed at 1,882 yuan/ton, down 2 yuan/ton from the settlement price of 1,884 yuan/ton on March 23. The weekly trading volume last week was 20.00668 million tons, a week-on-week decrease of 3.49162 million tons; the open interest was 8.4714 million tons, a week-on-week decrease of 257,200 tons. Since the conflict in the Middle East, urea has continued to fluctuate at a high level and fluctuated within a range with the change of sentiment. Last week, the decline of urea futures was greater than that of the spot price, and the basis weakened. As of March 30, the basis of the 05 contract was -22 yuan/ton, a weekly decrease of 7 yuan/ton. As of March 30, the 5 - 9 spread was -46 yuan/ton, a weekly decrease of 89 yuan/ton. On March 30, 2026, the number of urea warehouse receipts was 8,707, a week-on-week decrease of 5 [8][9][11] Urea Supply Side - Last week, the weekly output of urea decreased. From March 19 to March 25, the weekly output of urea was 1.4756 million tons, a decrease of 43,800 tons from the previous period, a week-on-week decrease of 2.88%, and the average daily output was 210,800 tons. Among them, the weekly output of coal-based urea was 1.2282 million tons, a week-on-week decrease of 2.41%; the weekly output of gas-based urea was 247,400 tons, a week-on-week decrease of 5.14%; the weekly output of small-granule urea was 116,970 tons, a week-on-week decrease of 3.15%; the weekly output of large-granule urea was 305,900 tons, a week-on-week decrease of 1.83%. In the next cycle, 3 enterprises are expected to resume production, and 3 enterprises are expected to stop production. According to Feiyitong data, on March 30, 2026, the national daily output of urea was 219,900 tons, an increase of 19,000 tons from the previous day, and the operating rate was 87.67%. The international coal price increase and the general rise of the energy and chemical sector caused by the tight balance of overseas energy have driven up the coal price. However, as it is currently the off-peak season for electricity demand, the domestic inventory has increased, and there is no strong driving force for the price to rise in the off-peak season, but it is expected to perform well in the summer peak season. As of March 30, the quoted price of Qinhuangdao thermal coal Q5500 was 761 yuan/ton, a weekly increase of 18 yuan/ton; the market price of anthracite washed small pieces in Jincheng was 950 yuan/ton, a weekly increase of 30 yuan/ton. Last week, the domestic liquefied natural gas price increased. As of March 30, the domestic benchmark price of liquefied natural gas was 4,494 yuan/ton, a weekly increase of 304 yuan/ton compared with 4,190 yuan/ton on March 23. Last week, the price of synthetic ammonia increased. As of March 27, the price of synthetic ammonia in Shandong was 2,425 yuan/ton, a weekly increase of 50 yuan/ton; the spot price of urea increased; the spread between synthetic ammonia and urea in Shandong was 525 yuan/ton, a weekly increase of 20 yuan/ton. Last week, the spot price of methanol increased. As of March 27, the quoted price of methanol was 2,850 yuan/ton, and the spread between methanol and urea was 950 yuan/ton, a weekly increase of 105 yuan/ton [15][17][19] Urea Demand Side - As of March 27, the quoted price of 45% sulfur-based compound fertilizer was 3,380 yuan/ton, a week-on-week increase of 30 yuan/ton. Currently, the operating rate of compound fertilizer factories has gradually increased to a high level, and the finished product inventory in the factories has been transferred to the end-users. However, as the spring fertilizer season is coming to an end, the subsequent operating rate may stabilize. Recently, the prices of raw materials have increased to varying degrees. After the increase in compound fertilizer prices, the follow-up of new orders has slowed down, and most of them are based on the execution of previous orders. As of March 27, the operating rate of compound fertilizer factories was 51.24%, a week-on-week increase of 1.27% and a year-on-year decrease of 3.06%. From March 21 to March 27, the weekly average capacity utilization rate of melamine in China was 51.24%, an increase of 6.67 percentage points from the previous period and 10.05 percentage points higher than the same period last year. The increase in urea price and international energy price has been transmitted to melamine, and under the sentiment of buying on rising and not buying on falling of downstream customers, the peak season is obvious, and the operating rate of factories has significantly increased this week. In terms of inventory data, as of March 26, 2026, the total inventory of urea enterprises in China was 700,500 tons, a decrease of 108,400 tons from the previous week, a week-on-week decrease of 13.4%, and 167,300 tons lower than the same period last year. During the peak season of spring plowing, the downstream sales were smooth, and the downstream factories actively purchased and stocked up. The resonance of the peak season of spring plowing and the increase in international urea prices stimulated more active trading activity, and the inventory in urea factories significantly decreased. It is expected that the de-stocking pattern will not change in the short term, and the de-stocking will continue next week. The sample inventory at ports was 169,000 tons, an increase of 20,000 tons from the previous week [22][23] International Market - Australia has a large rigid demand gap, and global supplies are concentrated in Australia. In addition, the supply and shipment in the Middle East are affected by the geopolitical conflict, and the prices of energy such as natural gas and oil have skyrocketed, accelerating the price increase of global nitrogen fertilizers. Next, attention should be paid to India's new round of tendering. As of March 27, the FOB price of small-granule urea in China was reported at $752.5/ton, a week-on-week increase of $40/ton; the FOB price in the Baltic Sea was $622.5/ton, a week-on-week increase of $27.5/ton; the price in the Arabian Gulf was $742.5/ton, a week-on-week increase of $27.5/ton; the CFR price in Southeast Asia was $772.5/ton, a week-on-week increase of $27.5/ton. As of March 27, the FOB price of large-granule urea in China was reported at $795/ton, a week-on-week increase of $72.5/ton; the FOB price of large-granule urea in Egypt was $767.5/ton, a week-on-week increase of $42.5/ton; the FOB price of large-granule urea in the Arabian Gulf was $727/ton, a week-on-week increase of $47.5/ton; the FOB price of large-granule urea in the Baltic Sea was $686.5/ton, a week-on-week increase of $21.5/ton; the CFR price in Southeast Asia was $775/ton, a week-on-week increase of $25/ton; the FOB price in the US Gulf was $685/ton, a week-on-week increase of $26/ton [25][27]