Report Summary 1. Report Industry Investment Rating - The investment rating for the urea in the energy and chemical industry is "oscillating bullish" [1] 2. Core View - The urea price is expected to oscillate strongly within the range of 1830 - 1950 yuan/ton due to complex geopolitical situation in the Middle East, high - volatility of international crude oil, temporary shutdown of some urea production facilities overseas, cautious mid - downstream high - price purchasing, low pressure on upstream factories, suspension of exports and release of reserve supplies [1] 3. Summary by Relevant Catalogs **Market Review** - On Friday, the price of the main urea contract 2605 rose 8 yuan to 1877 yuan/ton, and the spot price in the central China mainstream area was 1860 yuan/ton. Long - position holdings decreased by 124 lots to 271,000 lots, and short - position holdings decreased by 266 lots to 306,000 lots [1] **Important Information** - **Supply**: The daily urea production in the industry is 20.9 tons, 0.1 tons less than the previous working day and 1.2 tons more than the same period last year. The operating rate is 88.9%, 1.2% higher than 87.7% in the same period last year [1] - **Inventory**: The total inventory of Chinese urea enterprises is 70.05 tons, 10.84 tons less than the previous period, a 13.40% month - on - month decrease. The sample inventory at urea ports is 16.9 tons, a 0.2 - ton month - on - month increase [1] - **Demand**: The operating rate of compound fertilizer is 51.2%, a 1.2% month - on - month increase, and the operating rate of melamine is 59.3%, a 5.9% month - on - month increase [1] - **Tender**: India's RCF urea import tender received 20 suppliers with a total bid volume of over 3.07 million tons. The lowest offer on the east coast is CFR512 dollars/ton, and on the west coast is CFR508 dollars/ton. India intends to purchase 1.5 million tons [1] - **Export**: In January 2026, urea exports were 307,900 tons, a 10.61% month - on - month increase, with an average export price of 397.50 dollars/ton, a 0.19% month - on - month decrease. In February 2026, exports were 111,500 tons, a 63.78% month - on - month decrease, with an average export price of 398.52 dollars/ton, a 0.26% month - on - month increase [1] - **Oil Price**: Due to the continuous blockage of the Strait of Hormuz and market doubts about the prospect of US - Iran peace talks, international oil prices rose. NYMEX crude oil futures contract 05 rose 5.16 dollars/barrel to 99.64 dollars/barrel, a 5.46% month - on - month increase; ICE Brent crude oil futures contract 05 rose 4.56 dollars/barrel to 112.57 dollars/barrel, a 4.22% month - on - month increase. China's INE crude oil futures contract 2605 rose 12.1 to 740.5 yuan/barrel and 19.8 to 760.3 yuan/barrel in night trading [1] **Market Logic** - Complex geopolitical situation in the Middle East leads to high - volatility of international crude oil. Temporary shutdown of some urea production facilities overseas causes a sharp rise in overseas urea prices. Mid - downstream buyers are cautious about high - price purchases, while upstream factories face low pressure. Exports are suspended, and reserve supplies are released to the market [1] **Trading Strategy** - Suggestion is to wait and see or go short - term long at low prices [1]

Summary of Key Points from Conference Call on Urea Market Impact Due to Middle East Conflict Industry Overview - The conference call discusses the global urea market, particularly focusing on the impact of the ongoing Middle East conflict on supply and pricing dynamics in the urea industry. Core Insights and Arguments 1. **Supply Disruption**: The Middle East conflict has led to a significant disruption in global urea supply, with production halts in Iran and Qatar affecting approximately 17 million tons of maritime volume, accounting for 32% of global trade [1][3]. 2. **Price Surge**: International urea prices have increased by $200-$250 per ton within two weeks of the conflict, with potential for prices to exceed historical highs if production continues to be affected [1][2]. 3. **India's Role**: India, a major urea importer, has seen its domestic inventory rise to 620 million tons, but production has been impacted by gas supply disruptions from Qatar, leading to a monthly loss of 80,000 tons [1][4][7]. 4. **Export Restrictions**: China has tightened regulations on urea exports, halting nitrogen-potassium mixed fertilizer and small package urea exports, with low probability of lifting export quotas before the spring farming season ends [1][5]. 5. **Market Dynamics**: The domestic market is experiencing tightness due to speculative trading in futures, leading to a perceived supply shortage despite an expected surplus of 10 million tons in 2026 [1][12]. 6. **Future Price Drivers**: Key factors that may drive urea prices higher include potential new bidding activities from India and the operational status of Middle Eastern urea plants, which may face production cuts due to storage issues [9][16]. Additional Important Content 1. **Impact on Global Trade Flows**: The conflict has altered global urea trade flows, with Middle Eastern exports severely restricted, particularly through the Strait of Hormuz, affecting supply to various regions [3][21]. 2. **Regional Demand Variations**: The demand for urea is strong in Europe and the U.S. due to the spring planting season, while Brazil's demand is currently weak [2][14]. 3. **Long-term Supply Concerns**: The ongoing conflict may lead to permanent supply losses, making it difficult for prices to return to previous levels even after the conflict subsides [24]. 4. **Potential for Strategic Material Classification**: There is speculation that urea may be classified as a strategic material, leading to tighter export controls and concentration of export rights among a few state-owned enterprises [12]. 5. **Regional Variability in Impact**: Different regions will experience varying impacts from the supply disruptions, with Southeast Asia, particularly Thailand, expected to be significantly affected due to high dependency on Middle Eastern imports [19]. This summary encapsulates the critical insights and implications of the ongoing Middle East conflict on the urea market, highlighting the interplay between supply disruptions, pricing dynamics, and regional demand variations.

Report Industry Investment Rating - Not provided in the given content Core Viewpoints of the Report - The urea price is expected to follow the energy and chemical sector for a short - term correction and then enter a range - bound operation pattern [3][4] - The overall inventory of urea enterprises decreased this cycle, but the market was in a stalemate due to cold and snowy weather in the north, and local shipments declined [3] Summary by Relevant Catalogs Futures Market - Urea futures' closing price was 1,905 yuan/ton, up 75 yuan from the previous day; the settlement price was 1,926 yuan/ton, up 100 yuan; the trading volume was 597,997 lots, an increase of 363,802 lots; the open interest of the 05 contract was 242,697 lots, a decrease of 3,114 lots; the warehouse receipt quantity was 1,275 tons, unchanged; the trading volume was 230,366.6 million yuan, an increase of 144,821.8 million yuan [2] - The basis in Shandong area was - 25 yuan, a decrease of 55 yuan; the basis of Fengxi - disk was - 135 yuan, a decrease of 75 yuan; the basis of Dongguang - disk was - 75 yuan, a decrease of 75 yuan; the spread between UR05 - UR09 was - 15 yuan, a decrease of 2 yuan [2] Spot Market - The factory prices of urea in Henan Xinlianxin, Yankuang Xinjiang, Shandong Ruixing, Shanxi Fengxi, Hebei Dongguang, and Jiangsu Linggu remained unchanged [2] - The trader price in Shandong area was 1,880 yuan, up 20 yuan, and that in Shanxi area remained unchanged [2] - The supply - side indicators: the operating rate was 93.95%, unchanged, and the daily output was 221,210 tons, unchanged [2] Industry News - On March 4, 2026, the total inventory of Chinese urea enterprises was 1.0981 million tons, a decrease of 77,900 tons or 6.62% from the previous cycle. Inventory increased in Anhui, Gansu, Hainan, Hebei, Heilongjiang, and Liaoning, and decreased in Henan, Hubei, Jiangsu, Jiangxi, Inner Mongolia, Ningxia, Qinghai, Shandong, Shanxi, Shaanxi, Sichuan, Xinjiang, and Yunnan [3] Trend Intensity - The trend intensity of urea is - 1, indicating a bearish view [4]

Group 1: Report General Information - Report title: Urea Morning Report [2] - Date: February 25, 2026 [2] - Author: Zhu Tianyi from Dayue Futures Investment Consulting Department [3] - Contact: 0575 - 85226759 [3] Group 2: Industry Investment Rating - No information provided Group 3: Core Viewpoints - The overall fundamentals of urea are bullish, with the current daily production and operating rate at a high level compared to the same period in history. After the Spring Festival, with the restart of some natural gas plants, the daily production is expected to remain high, and the overall supply pressure is still at historically high levels. Industrial demand is weak, while agricultural reserve demand is good and is expected to increase with the start of spring plowing demand. The overall inventory continues to decline, and the destocking pattern is obvious. The external market price remains high, and the price difference between domestic and foreign exports continues to widen. The urea futures main contract is expected to fluctuate today [4]. Group 4: Urea Overview Fundamental Analysis - Supply: Current daily production and operating rate are at a high level compared to the same period, and after the Spring Festival, with the restart of some natural gas plants, the daily production is expected to remain high, and the overall supply pressure is at a historically high level [4]. - Demand: Industrial demand is weak, with the current operating rates of compound fertilizers and melamine at low levels. Agricultural reserve demand is good, and there is still room for growth with the start of spring plowing demand after the Spring Festival [4]. - Inventory: Comprehensive inventory continues to decline, with obvious destocking [4]. - External Market: The external market price remains high, and the price difference between domestic and foreign exports continues to widen [4]. - Policy: On February 12, the China Nitrogen Fertilizer Industry Association issued a statement on the market speculation of the urea guidance price, calling on market participants to "not spread or believe rumors" and emphasizing that the medium - and long - term urea price should be stable [4]. Other Indicators - Basis: The basis of the UR2605 contract is -25, and the premium/discount ratio is -1.4%, which is bearish [4]. - Inventory: The UR comprehensive inventory is 1.001 million tons (-83,000 tons), which is bullish [4]. - Disk: The 20 - day moving average of the UR main contract is upward, and the closing price is above the 20 - day line, which is bullish [4]. - Main Position: The net position of the UR main contract is short, and short positions are increasing, which is bearish [4]. Factors Affecting the Market - Bullish factors: Inventory destocking and good reserve demand [5]. - Bearish factors: Daily production at a historical high [5]. - Main logic: International prices and marginal changes in domestic demand [5]. Group 5: Market Data Spot and Futures Prices | Region | Price | Change | Main Contract | Price | Change | | --- | --- | --- | --- | --- | --- | | Spot delivery product | 1830 | +20 | 05 contract | 1855 | +22 | | Shandong spot | 1850 | +40 | Basis | -25 | -2 | | Henan spot | 1830 | 0 | UR01 | 1800 | +23 | | FOB China | 3237 | | UR05 | 1855 | +22 | | | | | UR09 | 1822 | +30 | [6] Inventory Data | Type | Quantity | Change | | --- | --- | --- | | Warehouse receipts | 8235 | -2147 | | UR comprehensive inventory | 1.001 million tons | -83,000 tons | | UR factory inventory | 835,000 tons | 0 | | UR port inventory | 166,000 tons | 0 | [6] Group 6: Supply - Demand Balance Sheet | Year | Capacity | Capacity Growth Rate | Output | Net Import Volume | PP Import Dependence | Apparent Consumption | Ending Inventory | Actual Consumption | Consumption Growth Rate | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | 2018 | | 2245.5 | | 1956.81 | 448.38 | 18.6% | 2405.19 | 23.66 | 2405.19 | | | 2019 | | 2445.5 | 8.9% | 2240 | 487.94 | 17.9% | 2727.94 | 37.86 | 2713.74 | 12.8% | | 2020 | | 2825.5 | 15.5% | 2580.98 | 619.12 | 19.3% | 3200.1 | 37.83 | 3200.13 | 17.9% | | 2021 | | 3148.5 | 11.4% | 2927.99 | 352.41 | 10.7% | 3280.4 | 35.72 | 3282.51 | 2.6% | | 2022 | | 3413.5 | 8.4% | 2965.46 | 335.37 | 10.2% | 3300.83 | 44.62 | 3291.93 | 0.3% | | 2023 | | 3893.5 | 14.1% | 3193.59 | 293.13 | 8.4% | 3486.72 | 44.65 | 3486.69 | 5.9% | | 2024 | | 4418.5 | 13.5% | 3425 | 360 | 9.5% | 3785 | 51.4 | 3778.25 | 8.4% | | 2025E | | 4906 | 11.0% | | | | | | | [9]

Group 1: Report Industry Investment Rating - No information provided Group 2: Core Views of the Report - Urea is in a stage of supply surplus due to the continuous release of new production capacity, and its price center in 2026 will further decline. However, the decline will be supported by export policies. The price trend in the first half of the year will depend on the demand rhythm, while in the second half, it will be policy - led. The urea 05 contract has a price increase expectation during the domestic demand peak season, but the price is expected to回调 in the short term, and it is recommended to exit long positions and hold an empty position during the holiday [3]. - The domestic urea market is rising firmly, with a price increase of 10 - 30 yuan/ton. The market is afraid of high prices, and the procurement rhythm of the middle and lower reaches has slowed down. In the short term, the price will remain firm, and some local prices will continue to rise [8]. - The trend of urea is expected to be oscillating and strengthening, with the UR2605 operating in the range of 1650 - 1950 yuan/ton. It is recommended to lay out long positions around 1700 yuan/ton [10]. Group 3: Summary by Directory Chapter 1: Core Contradictions and Strategy Recommendations - **Core Contradictions**: Urea is in a supply - surplus stage due to new capacity release. In 2026, the price center will decline, supported by export policies. The 05 contract has a price - increase expectation during the demand peak, but the price may回调 in the short term [3]. - **Trading - type Strategy Recommendations**: The trend of urea is oscillating and strengthening, with UR2605 in the range of 1650 - 1950 yuan/ton. It is recommended to lay out long positions around 1700 yuan/ton. For the basis strategy, contracts 11, 12, 01 have a weak unilateral trend, while 02, 03, 04, 05 are strong contracts. For the spread strategy, the upper pressure of 05 is 1950 yuan/ton, and the lower static support is 1650 yuan/ton. There is no hedging and arbitrage strategy [10][11]. Chapter 2: This Week's Important Information and Next Week's Attention Events - **This Week's Important Information**: **L利多 Information**: The fourth quarter is the winter storage stage of the fertilizer industry, and the relatively low price may attract spontaneous reserves. India's NFL issued a new urea import tender, intending to purchase 1.5 million tons. **利空 Information**: The current domestic urea daily output is 208,100 tons. After the recovery of some maintenance devices and the planned maintenance of some gas - head urea plants, the daily output is expected to decline to around 200,000 tons. The domestic urea market is expected to rebound slightly and then remain in a stalemate, with the bottom range possibly rising [12]. - **Next Week's Important Events**: China's urea production this week is 1.3153 million tons, a week - on - week increase of 37,400 tons or 2.93%. Next week, the production is expected to be around 1.34 million tons, and the probability of an increase is high [13]. Chapter 3: Disk Interpretation - **Price, Volume, and Fund Interpretation**: The domestic urea market continued to rise firmly over the weekend, with a price increase of 10 - 40 yuan/ton. The fourth batch of urea export quotas and the new Indian tender news boosted market sentiment. The upstream urea plants continued to raise prices, and the middle and lower reaches showed resistance. The short - term market will continue to be stable and slightly stronger [14]. - **Industrial Hedging Recommendations**: The price range of urea is predicted to be 1650 - 1950 yuan/ton, with a current volatility of 27.16% and a historical percentile of 62.1%. Different hedging strategies are provided for inventory management and procurement management, including futures trading and option trading [21][23]. Chapter 4: Valuation and Profit Analysis - **Upstream Profit Tracking**: Track the production costs and profits of different urea production methods, including fixed - bed, water - coal slurry gasification, and natural - gas - based production [25][27]. - **Upstream Capacity Utilization Tracking**: Track the daily output, weekly capacity utilization, coal - head capacity utilization, and natural - gas - based capacity utilization of urea [31]. - **Upstream Inventory Tracking**: Track the weekly enterprise inventory, port inventory, Guangdong and Guangxi inventory, and the total inventory (port + inland) of urea [33][35]. - **Downstream Price and Profit Tracking**: Track the capacity utilization, inventory, production cost, and market price of downstream products such as compound fertilizers and melamine [37][45]. - **Spot Production and Sales Tracking**: Track the average production and sales of urea and the production and sales in different regions such as Shandong, Henan, Shanxi, Hebei, and East China [60][61].

Core Viewpoint - The recent urea market has shown an upward trend, with improved trading atmosphere and a slight price increase due to better demand conditions [1] Group 1: Market Price and Trends - As of January 27, the average price of medium-sized urea in China is 1763.10 yuan per ton, reflecting a week-on-week increase of 0.17% [1] - Urea companies are experiencing a decrease in inventory, currently at 820,000 tons, which is a 2.14% decline from the previous period [1] Group 2: Demand and Production - The operating rate of compound fertilizer enterprises has improved to 49.27%, up by 6.11 percentage points week-on-week, indicating a recovery in production [1] - Some fertilizer companies are preparing for post-holiday shipments, with production in Hubei and Henan provinces gradually resuming [1] Group 3: Future Outlook - In early February, production is expected to increase as maintenance facilities in Chongqing and Inner Mongolia come back online, potentially raising daily output to over 210,000 tons [1] - As the Spring Festival approaches, it is anticipated that the operating rates of downstream compound fertilizer and industrial enterprises will gradually decline [1] - Urea companies currently have good pre-receipt orders, leading to limited downward price pressure, with expectations of narrow price adjustments before stabilizing for the holiday period [1]

1. Report's Industry Investment Rating - Not provided in the report 2. Core Viewpoints of the Report - The start of agricultural demand is the key to supporting urea prices. Although the fundamentals may deteriorate marginally during the downstream factory holidays, with the approaching spring plowing, urea prices are likely to rise rather than fall [2] 3. Summary by Relevant Catalogs 3.1 Spot Market Dynamics - Last week, upstream factories supported prices with pending orders, leading to a market inversion. Futures lacked support and downstream demand was weak, but spot prices remained stable. Some factories raised prices slightly over the weekend. The ex - factory price range of small - particle urea in Shandong, Henan, and Hebei is mostly between 1,690 - 1,720 yuan/ton [2][4][5] 3.2 Futures Dynamics - Last week, the urea futures market showed mixed trends, with an overall increase. As of January 26, the main May contract closed at 1,791 yuan/ton, up 10 yuan/ton from the settlement price on January 19. Weekly trading volume decreased by 255.34 million tons to 1,206.05 million tons, and open interest increased by 16.736 million tons to 776.372 million tons. The long - term trend remains strong. The futures increase was greater than the spot increase, and the basis weakened. As of January 26, the 05 - contract basis was - 51 yuan/ton, down 29 yuan/ton week - on - week, and the 5 - 9 spread was 22 yuan/ton, up 1 yuan/ton week - on - week. The number of urea warehouse receipts on January 26 was 13,274, down 81 week - on - week [7][8][10] 3.3 Urea Supply Side - Last week, urea weekly production increased. From January 15 - 21, weekly production was 1.4238 million tons, up 1.33% from the previous period, with an average daily production of 203,400 tons. Coal - based production increased by 0.74%, gas - based production increased by 5.30%. Small - particle production increased by 1.60%, and large - particle production increased by 0.28%. On January 26, the national daily urea production was 206,100 tons, up 19,000 tons from the previous day, with an operating rate of 83.68%. Coal prices weakened, LNG prices remained unchanged, synthetic ammonia prices fell, and methanol prices rose [15][17][18] 3.4 Urea Demand Side - As of January 26, the price of 45% sulfur - based compound fertilizer remained stable week - on - week. The operating rate of compound fertilizer factories continued to increase and was higher than the same period in previous years. However, due to cost support for phosphorus and potassium fertilizers, compound fertilizer prices were in a stalemate, downstream demand was weak, and there was a possibility of production cuts due to squeezed profits. As of January 23, the operating rate of compound fertilizer factories was 63.65%, up 1.47% from the previous period and 3.48% year - on - year. From January 19 - 23, the average weekly capacity utilization rate of melamine in China was 63.65%, up 1.47 percentage points from the previous period but lower than the same period last year. Industrial demand only maintained basic needs. As of January 23, 2025, the total inventory of Chinese urea enterprises was 946,000 tons, down 40,100 tons from the previous week, a decrease of 4.07% and 488,900 tons lower than the same period last year. Port inventory was 134,000 tons, unchanged from the previous week [20][22] 3.5 International Market - Export restrictions in China and Iran have pushed up international urea prices. India is expected to issue a tender in February, and there is also import demand in Mexico and Latin America due to supply shortages. As of January 23, small - particle FOB prices in China increased by 15 US dollars/ton week - on - week to 420 US dollars/ton, and large - particle FOB prices in China increased by 10 US dollars/ton week - on - week to 425 US dollars/ton. FOB prices in other regions also showed varying degrees of increase [24]

Group 1: Report Industry Investment Rating - Not mentioned in the provided content Group 2: Core Viewpoints of the Report - This week, urea continues its oscillating pattern with low - price procurement. Attention should be paid to external disturbances. Mainstream factory ex - factory prices in most regions are stable, but market sentiment is low and trading is weak. Industrial compound fertilizer开工率 has increased, but raw material and finished - product inventories are high, and grass - roots orders are scarce. Agricultural procurement is mainly for rigid demand, and traders are starting to sell due to fear of high prices. New orders are weak [4]. - Domestic gas - head maintenance devices have partially returned, and the daily output has rebounded to over 200,000 tons, running at a high level. The Indian tender result is CFR $420 per ton, with a total counter - offer of around 960,000 tons from the east and west coasts. Although international prices have been rising, the domestic - international price difference is still large, but there are no new domestic quotas, so the overall impact is limited [4]. - The compound fertilizer开工率 in the Central Plains and Northeast regions is stable. Compound fertilizer enterprises that stopped production due to environmental protection in Hebei and Henan have resumed production, and enterprises with low raw material inventories are purchasing at low prices. The procurement progress of off - season storage enterprises has basically reached over 70%, and the procurement intensity will gradually slow down [4]. - As the ex - factory price rises, downstream resistance increases, traders sell due to fear of high prices, agricultural procurement enthusiasm cools down, factory orders weaken, and ex - factory quotes start to decline. The futures price decline further cools the spot market sentiment. Although the overall order - receiving situation has improved after the urea manufacturers lower the ex - factory quotes, downstream customers in high - price sales areas still resist. In the short term, it will continue to oscillate, and cautious operation is recommended [4]. - Trading strategy: For single - side trading, short at high prices and do not chase short positions; for arbitrage, wait and see; for over - the - counter trading, wait and see [4] Group 3: Summary of Each Section 2. Core Data Changes - **Supply - National**: In the 3rd week of 2026 (20260115 - 0121), the capacity utilization rate of coal - based urea was 95.30%, a week - on - week increase of 0.70%; the capacity utilization rate of gas - based urea was 54.07%, a week - on - week increase of 2.72%. There were 3 new coal - based device shutdowns and 4 coal - based enterprise shutdown devices resumed production during the period [5]. - **Supply - Shandong**: In the 3rd week of 2026 (20260115 - 0121), the capacity utilization rate of Shandong urea was 97.53%, a week - on - week decrease of 0.37%. The Ming Shui device had a slight production reduction, and other enterprises' production was basically normal [5]. - **Demand - Melamine**: In the 4th week of 2026 (20260116 - 0122), the weekly average capacity utilization rate of Chinese melamine was 63.65%, an increase of 1.47 percentage points from the previous week [5]. - **Demand - Compound Fertilizer**: From 20260116 - 0122, the capacity utilization rate of compound fertilizer in this cycle was 42.96%, a week - on - week increase of 2.88 percentage points [5]. - **Demand - Compound Fertilizer Urea Demand**: As of January 23, 2026, the urea demand of sample compound fertilizer production enterprises in Linyi, Shandong was 1,840 tons, an increase of 460 tons from the previous week, a week - on - week increase of 33.33% [5]. - **Demand - Northeast Arrival Volume**: From 20260116 - 20260123, the arrival volume of urea in the Northeast was 90,000 tons, a decrease of 5,000 tons from the previous week. Downstream factories and traders mainly purchase low - price goods for rigid demand and resist price increases [5]. - **Demand - Advance Receipts**: As of January 21, 2026, the advance order days of Chinese urea enterprises were 5.88 days, a decrease of 0.18 days from the previous cycle, a week - on - week decrease of 2.97% [5]. - **Inventory - Enterprise**: On January 21, 2026, the total inventory of Chinese urea enterprises was 946,000 tons, a decrease of 40,100 tons from the previous week, a week - on - week decrease of 4.07%. The inventory reduction was mainly concentrated in Inner Mongolia [5]. - **Inventory - Port**: As of January 22, 2026, the sample inventory of Chinese urea ports was 134,000 tons, unchanged from the previous week [5]. - **Valuation**: In terms of profit, the price of Jincheng anthracite lump coal rebounded, the price of Yulin pulverized coal was weak, the urea spot price increased, and the urea production profit expanded. The fixed - bed production profit was 70 yuan/ton, the water - coal - slurry production profit was 150 yuan/ton, and the entrained - flow bed production profit was 390 yuan/ton. The futures price rebounded, the basis was around - 80 yuan/ton, and the 5 - 9 spread was 28 yuan/ton [5]

Report Industry Investment Rating - Not provided Core Viewpoints - The urea price is expected to be volatile in the short term and bullish in the medium term, with obvious support at the bottom for both futures and spot prices due to the strong expectation of post - Spring Festival agricultural demand [3] Summary by Relevant Catalogs Fundamental Tracking - **Futures Market**: The closing price of the urea main contract was 1,775 yuan/ton, up 3 yuan from the previous day; the settlement price was 1,768 yuan/ton, down 13 yuan; the trading volume was 175,891 lots, an increase from the previous day; the open interest of the 05 contract was 233,074 lots, down 2,813 lots; the warehouse receipt quantity was 13,355 tons, unchanged; the trading volume was 621.93 million yuan, an increase of 211.744 million yuan. The basis in Shandong area was - 25 yuan, down 3 yuan; the basis of Fengxi - disk was - 145 yuan, down 3 yuan; the basis of Dongguang - disk was - 45 yuan, down 3 yuan; the spread between UR05 - UR09 was 26, unchanged [1] - **Spot Market**: The factory prices of Henan Xinlianxin, Yankuang Xinjiang, Shanxi Fengxi, Hebei Dongguang, and Jiangsu Linggu remained unchanged, while Shandong Ruixing's price dropped by 20 yuan to 1,725 yuan/ton. The trading prices in Shandong area remained unchanged at 1,750 yuan/ton, and in Shanxi area dropped by 10 yuan to 1,630 yuan/ton [1] - **Supply - side Indicators**: The operating rate was 85.19%, up 0.47 percentage points; the daily output was 200,580 tons, an increase of 1,100 tons [1] Industry News - On January 21, 2026, the total inventory of Chinese urea enterprises was 946,000 tons, a decrease of 40,100 tons from the previous week, a month - on - month decrease of 4.07%. The inventory reduction was mainly concentrated in Inner Mongolia. Some enterprises in the main production and sales areas had a slight inventory build - up, but the overall inventory decreased due to the demand in the Northeast region [2] - The overall spot trading of urea has been weak in recent days, and the spot price is expected to remain stable [2][3] Trend Intensity - The trend intensity of urea is 0, indicating a neutral view [3]

Group 1: Report Industry Investment Rating - No relevant content found Group 2: Core Viewpoints of the Report - Last week's view was that due to high - price resistance, urea would fluctuate. This week's view is that with low - price procurement, urea will continue the fluctuating pattern, and external disturbances should be noted. The mainstream ex - factory prices in major regions have remained stable overall since the weekend, with low market sentiment, weak trading, and sporadic orders received by manufacturers. In Shandong, Henan, and delivery areas, ex - factory prices are expected to remain firm. The daily output of domestic urea has rebounded to around 200,000 tons. The Indian tender result is CFR $420 per ton, with a counter - offer of around 960,000 tons, and the impact on the domestic market is limited. The compound fertilizer开工率 in the Central and Northeast regions has increased, and raw material inventory is being replenished at low prices. The procurement intensity of seasonal storage enterprises will gradually slow down. As the ex - factory price rises, downstream resistance emerges, and the ex - factory price will mainly decline. The trading strategy is to go short unilaterally without chasing the short, and to wait and see for arbitrage and over - the - counter trading [3][4] Group 3: Summary by Relevant Catalogs 1. Core Data Changes - Supply: In the 2nd week of 2026 (January 8 - 14), the capacity utilization rate of coal - based urea in China was 94.60%, a 1.54% increase from the previous week; the capacity utilization rate of gas - based urea was 51.35%, a 3.79% increase. In Shandong, the capacity utilization rate was 97.90%, a 1.11% decrease [5] - Demand: In the 3rd week of 2026 (January 9 - 15), the average weekly capacity utilization rate of melamine in China was 62.18%, a 7.83 - percentage - point increase from the previous week. The capacity utilization rate of compound fertilizer was 40.08%, a 2.91 - percentage - point increase. As of January 16, 2026, the urea demand of sample compound fertilizer production enterprises in Linyi, Shandong was 1,380 tons, a 12.66% decrease from the previous week. The arrival volume of urea in the Northeast this week was 95,000 tons, a decrease of 15,000 tons from the previous week. As of January 14, 2026, the pre - order days of Chinese urea enterprises were 6.06 days, a 5.46% decrease from the previous period [5] - Inventory: On January 14, 2026, the total inventory of Chinese urea enterprises was 986,100 tons, a 3.53% decrease from the previous week. As of January 15, 2026, the sample inventory of Chinese urea ports was 134,000 tons, a 4.29% decrease from the previous week [5] - Valuation: The price of Jincheng anthracite lump coal rebounded, the price of Yulin pulverized coal was stable, the spot price of urea increased, and the production profit of urea expanded. The fixed - bed production profit was 70 yuan per ton, the water - coal - slurry production profit was 150 yuan per ton, and the entrained - flow bed production profit was 390 yuan per ton. The futures rebounded, the basis was around - 80 yuan per ton, and the 5 - 9 spread was 28 yuan per ton [5]