1. Report Industry Investment Rating - No information provided in the given content. 2. Core View of the Report - The overall fundamentals of urea are bullish, with high daily production and operating rates year - on - year, expected to remain at a high level. Industrial demand is mixed, agricultural demand has reached a phased peak, and inventory has accumulated. The UR main contract is expected to fluctuate widely, and it is predicted that the UR will fluctuate today [4]. 3. Summary by Relevant Catalogs Urea Overview - **Fundamentals**: Current daily production and operating rates are at a high level year - on - year, and daily production is expected to remain high, with overall ample supply. Industrial demand has recovered, with the operating rate of compound fertilizers rising and that of melamine falling. Agricultural phased demand has temporarily ended, and comprehensive inventory has accumulated. The overseas price has continued to strengthen due to geopolitical factors, widening the price difference between domestic and foreign exports. The domestic price increase is limited by guidance. The current spot price of the delivery product is 1870 (+10), and the overall fundamentals are bullish [4]. - **Basis**: The basis of the UR2605 contract is - 19, with a premium/discount ratio of - 1.0%, which is bearish [4]. - **Inventory**: The UR comprehensive inventory is 114.7 million tons (-14.2), which is bearish [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 short position of the UR main contract has increased, which is bearish [4]. - **Expectation**: The UR main contract is expected to fluctuate widely. With high daily production year - on - year, differentiated industrial demand, a phased peak in agricultural demand, and inventory accumulation, the UR is expected to fluctuate today [4]. - **Leverage and Risks**: The bullish factors are that agricultural demand is gradually entering the peak season and overseas prices are continuously strengthening. The bearish factor is that the daily production is at a historical high. The main logic lies in international prices and marginal changes in domestic demand, and the main risk point is the change in export policies [5]. Spot and Futures Market | Category | Details | | --- | --- | | **Spot** | The price of the spot delivery product is 1870 (+10), Shandong spot is 1900 (+10), Henan spot is 1870 (0), and FOB China is 3881 [6]. | | **Futures** | The price of the 05 contract is 1889 (+14), the basis is - 19 (-4), UR01 is 1877 (+20), UR05 is 1889 (+14), and UR09 is 1912 (+22) [6]. | | **Inventory** | The warehouse receipt is 8055 (+1675), UR comprehensive inventory is 114.7 million tons (-14.2), UR manufacturer inventory is 95.8 million tons (-14.1), and UR port inventory is 18.9 million tons (-0.1) [6]. | Supply - Demand Balance Sheet | Year | Capacity | Capacity Growth Rate | Output | Net Imports | 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] |

1. Report Industry Investment Rating - The report does not mention the industry investment rating. 2. Core View of the Report - In the short - term, due to geopolitical uncertainties, international energy prices are in a high - level wide - range oscillation pattern. Urea, with a relatively strong short - term fundamental situation, follows the upward shift of the oscillation center. However, policy constraints limit the upside potential of its valuation [2]. 3. Summary by Relevant Catalogs 3.1 Fundamental Tracking 3.1.1 Urea Futures Market (05 Contract) - Closing price: 1,872 yuan/ton, up 16 yuan from the previous day [1]. - Settlement price: 1,860 yuan/ton, up 13 yuan from the previous day [1]. - Trading volume: 300,925 lots, a decrease of 41,865 lots from the previous day [1]. - Open interest: 229,705 lots, an increase of 15,308 lots from the previous day [1]. - Warehouse receipt quantity: 5,433 tons, an increase of 98 tons from the previous day [1]. - Turnover: 1,119,180 ten - thousand yuan, a decrease of 147,033 ten - thousand yuan from the previous day [1]. 3.1.2 Basis - Shandong regional basis: 18, a decrease of 16 from the previous day [1]. - Fengxi - disk basis (with about 100 yuan/ton freight): - 102, a decrease of 16 from the previous day [1]. - Dongguang - disk basis (cheapest deliverable): - 42, a decrease of 16 from the previous day [1]. 3.1.3 Monthly Spread - UR05 - UR09 (Henan Xinlianxin): - 13 (1,815), an increase of 15 from the previous day [1]. 3.1.4 Urea Factory Prices - Yankuang Xinjiang: 1,490 yuan/ton, up 140 yuan from the previous day [1]. - Shandong Ruixing: 1,840 yuan/ton, unchanged from the previous day [1]. - Shanxi Fengxi: 1,770 yuan/ton, unchanged from the previous day [1]. - Hebei Dongguang: 1,830 yuan/ton, unchanged from the previous day [1]. - Jiangsu Linggu: 1,870 yuan/ton, unchanged from the previous day [1]. 3.1.5 Trader Prices - Shandong region: 1,890 yuan/ton, unchanged from the previous day [1]. - Shanxi region: 1,770 yuan/ton, unchanged from the previous day [1]. 3.1.6 Supply - side Key Indicators - Operating rate: 93.95%, unchanged from the previous day [1]. - Daily output: 221,210 tons, unchanged from the previous day [1]. 3.2 Industry News - On March 11, 2026, the total inventory of Chinese urea enterprises was 957,600 tons, a decrease of 140,500 tons from the previous period, a month - on - month decrease of 12.79%. Recently, affected by international geopolitical conflicts, market trading sentiment has been boosted, downstream purchasing enthusiasm has increased again, and urea factories have shipped smoothly. Inventory has decreased in most regions. Provinces with increased inventory: Hainan, Hebei; provinces with decreased inventory: Anhui, Henan, Heilongjiang, Hubei, Jiangsu, Jiangxi, Liaoning, Inner Mongolia, Qinghai, Shandong, Shanxi, Shaanxi, Sichuan, Xinjiang, Yunnan [2].

Group 1: Report Industry Investment Rating - No relevant information provided Group 2: Core Viewpoints of the Report - The overall fundamentals of urea are bullish, with the main contract of urea showing a volatile and strong trend. The daily production is at a high level year - on - year, industrial demand is weak but reserve demand is good, agricultural demand has room for growth in the near future, and inventories are accumulating. It is expected that urea will show a volatile trend today [4]. - The bullish factors for urea include the gradual transition of agricultural demand to the peak season and the continuous strengthening of overseas prices, while the bearish factor is the historical high of daily production. The main logic lies in international prices and marginal changes in domestic demand [5]. Group 3: Summary by Relevant Catalogs Urea Overview - **Fundamentals**: Current daily production and operating rate are at a high level year - on - year. After the Spring Festival, with the restart of some natural gas plants, daily production is expected to remain high. Overall supply pressure is at a historical high for the same period. Industrial demand is weak but has a recovery expectation. Compound fertilizer operating rate is rising, while melamine operating rate is falling. Agricultural demand is gradually entering the peak season, and comprehensive inventories are accumulating. The external price continues to rise due to geopolitical factors, and the price difference between domestic and export markets is widening [4]. - **Basis**: The basis of the UR2605 contract is 38, with a premium/discount ratio of 2.0%, which is bullish [4]. - **Inventory**: The UR comprehensive inventory is 1.35 million tons (+154,000 tons), which is bearish [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]. - **Expectation**: The main contract of urea is expected to show a volatile and strong trend on the disk. With daily production at a high level year - on - year, weak industrial demand but good reserve demand, agricultural demand has room for growth in the near future. With inventory accumulation, the UR is expected to show a volatile trend today [4]. Spot and Futures Market | Category | Details | | --- | --- | | **Spot Market** | The price of the spot delivery product is 1860 (unchanged), Shandong spot price is 1880 (-10), Henan spot price is 1860 (unchanged), and FOB China price is 3327 [6]. | | **Futures Market** | The price of the 05 contract is 1822 (+3), the basis is 38 (-3). UR01 price is 1788 (+4), UR05 price is 1822 (+3), and UR09 price is 1812 (+7) [6]. | | **Inventory** | The number of warehouse receipts is 1275 (-4683), UR comprehensive inventory is 1.35 million tons, UR manufacturer inventory is 1.176 million tons, and UR port inventory is 0.174 million tons [6]. | Supply - Demand Balance Sheet | Year | Capacity | Capacity Growth Rate | Production | Net Imports | PP Import Dependence | Apparent Consumption | Ending Inventory | Actual Consumption | Consumption Growth Rate | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | 2018 | - | 2245.5 | - | 1956.81 | 18.6% | 2405.19 | 23.66 | 2405.19 | - | | 2019 | - | 2445.5 | 8.9% | 2240 | 17.9% | 2727.94 | 37.86 | 2713.74 | 12.8% | | 2020 | - | 2825.5 | 15.5% | 2580.98 | 19.3% | 3200.1 | 37.83 | 3200.13 | 17.9% | | 2021 | - | 3148.5 | 11.4% | 2927.99 | 10.7% | 3280.4 | 35.72 | 3282.51 | 2.6% | | 2022 | - | 3413.5 | 8.4% | 2965.46 | 10.2% | 3300.83 | 44.62 | 3291.93 | 0.3% | | 2023 | - | 3893.5 | 14.1% | 3193.59 | 8.4% | 3486.72 | 44.65 | 3486.69 | 5.9% | | 2024 | - | 4418.5 | 13.5% | 3425 | 9.5% | 3785 | 51.4 | 3778.25 | 8.4% | | 2025E | - | 4906 | 11.0% | - | - | - | - | - | - | [9] |

1. Report Industry Investment Rating - No information provided 2. Core Viewpoints - The current daily production and operating rate of urea are at a high level year-on-year. With the return of maintenance, the operating rate is expected to continue to rise. The comprehensive inventory is declining, showing an obvious de-stocking pattern. Although it is approaching the Spring Festival, the order demand is still good, the agricultural reserve demand is strong, and the demand for compound fertilizers in the industrial sector is stable, while the operating rate of melamine is falling. There is a large price difference between domestic and international markets for exports. Recently, the downstream demand is fair, but the domestic urea market is still in oversupply. The spot price of the delivery product is 1800 (unchanged), and the overall fundamentals are neutral. The UR2605 contract basis is 3, with a premium/discount ratio of 0.2%, also neutral. The UR comprehensive inventory is 1.084 million tons (-0.5), which is bullish. The 20-day moving average of the UR main contract is upward, and the closing price is above the 20-day line, which is also bullish. The net position of the UR main contract is short, and the short positions are decreasing, which is bearish. It is expected that the UR main contract will fluctuate today [4]. 3. Summary by Relevant Catalogs Urea Overview - **Fundamentals**: Current daily production and operating rate are at a high level year-on-year. With the return of maintenance, the operating rate is expected to continue to rise. The comprehensive inventory is declining, showing an obvious de-stocking pattern. Although it is approaching the Spring Festival, the order demand is still good, the agricultural reserve demand is strong, and the demand for compound fertilizers in the industrial sector is stable, while the operating rate of melamine is falling. There is a large price difference between domestic and international markets for exports. Recently, the downstream demand is fair, but the domestic urea market is still in oversupply. The spot price of the delivery product is 1800 (unchanged), and the overall fundamentals are neutral [4]. - **Basis**: The UR2605 contract basis is 3, with a premium/discount ratio of 0.2%, which is neutral [4]. - **Inventory**: The UR comprehensive inventory is 1.084 million tons (-0.5), 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 the short positions are decreasing, which is bearish [4]. - **Expectation**: The UR main contract is expected to fluctuate today. The operating rate is at a high level year-on-year. Although it is approaching the Spring Festival, the downstream reserve demand is fair, and the inventory is decreasing [4]. Factors Affecting Urea - **Bullish Factors**: Inventory de-stocking and good reserve demand [5]. - **Bearish Factors**: Domestic oversupply [5]. - **Main Logic**: International prices and marginal changes in domestic demand [5]. Spot and Futures Market Conditions | Region | Price | Change | Main Contract | Price | Change | Type | Quantity | Change | | ---- | ---- | ---- | ---- | ---- | ---- | ---- | ---- | ---- | | Spot Delivery Product | 1800 | 0 | 05 Contract | 1797 | 12 | Warehouse Receipt | 10949 | -87 | | Shandong Spot | 1800 | 0 | Basis | 3 | -12 | UR Comprehensive Inventory | 108.4 | -0.5 | | Henan Spot | 1800 | 0 | UR01 | 1748 | 13 | UR Manufacturer Inventory | 91.9 | 0 | | FOB China | 3059 | | UR05 | 1797 | 12 | UR Port Inventory | 16.5 | 0 | | | | | UR09 | 1756 | 13 | | | | [6] Urea Supply and Demand Balance Sheet | Year | Production Capacity | Capacity Growth Rate | Output | Net Imports | 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]

1. Report Industry Investment Rating - The investment rating for the urea industry is "Oscillating Weakly" [1] 2. Core Viewpoints of the Report - The urea market opened low and moved lower today, with the spot price rising as some factories completed holiday orders and held prices, while others actively attracted orders. The fundamentals show that gas - based plants have basically resumed production, and production will be normal during the Spring Festival. The agricultural demand is fair, and the industrial demand is weakening marginally. The supply - demand balance supports the urea market. The impact of the Indian tender on the domestic market is small, and before the Spring Festival, the trading volume will be low with limited price fluctuations [1] 3. Summary by Relevant Catalogs 3.1. Market Analysis - The urea futures opened low and moved down today, and the spot price increased. The gas - based plants have mostly resumed production and have no long - term shutdown plan in the short term. Agricultural demand is okay, and the wheat top - dressing season is coming after the Spring Festival. Industrial demand is weakening, and the inventory of factories has been slightly digested. The supply - demand balance supports the market. The impact of the Indian tender on the domestic market is limited, and price fluctuations are expected to be small before the Spring Festival [1] 3.2. Futures and Spot Market Conditions Futures - The main urea 2605 contract opened at 1788 yuan/ton, closed at 1785 yuan/ton, with a decline of 0.61% and a position of 218,805 lots (- 6887 lots). Among the top 20 positions, long positions decreased by 5480 lots and short positions decreased by 2892 lots. For example, Orient Futures had a net long - position decrease of 4114 lots and CICC Wealth had a net long - position decrease of 1075 lots; Galaxy Futures had a net short - position decrease of 285 lots and Ruida Futures had a net short - position decrease of 1235 lots. On February 10, 2026, the number of urea warehouse receipts was 11036, a net increase of 176 from the previous trading day [2] Spot - Some factories completed holiday orders and held prices, while others actively attracted orders, leading to an overall increase in the spot price. The ex - factory price of small - particle urea in Shandong, Henan, and Hebei was mostly in the range of 1730 - 1780 yuan/ton [3] 3.3. Fundamental Tracking Basis - The mainstream spot price and the futures closing price both increased today. Based on the Henan region, the basis strengthened compared to the previous trading day, and the basis of the May contract was 2 yuan/ton (+ 18 yuan/ton) [7] Supply - According to Feiyitong data, on February 10, 2026, the national daily urea production was 215,600 tons, an increase of 38,000 tons from the previous day, with an operating rate of 86.41% [8]

1. Report Industry Investment Rating No information provided. 2. Core View of the Report - The current daily production and operating rate of urea are at a high level compared to the same period last year. With the return of maintenance, the operating rate is expected to continue to rise. The comprehensive inventory has declined, showing an obvious de - stocking pattern. Although the Spring Festival is approaching, the order demand is still acceptable, and the agricultural reserve demand is good. In the industrial demand, the demand for compound fertilizers is stable, while the operating rate of melamine has declined. There is a large price difference between domestic and foreign markets for exports. Recently, the downstream demand is acceptable, but the domestic urea market is still in a state of oversupply. The spot price of the delivery product is 1790 (+30), and the overall fundamentals are neutral. The UR2605 contract basis is 2, with a premium - discount ratio of 0.1%, which is also neutral. The UR comprehensive inventory is 1084 thousand tons (-0.5), which is bullish. The 20 - day moving average of the UR main contract is upward, and the closing price is above the 20 - day moving average, which is bullish. The net position of the main UR contract holders is short, and the short position is decreasing, which is bearish. It is expected that the UR main contract will fluctuate today [4]. 3. Summary by Relevant Catalogs Urea Overview - **Fundamentals**: Current daily production and operating rate are at a high level year - on - year. With the return of maintenance, the operating rate is expected to continue to rise. Comprehensive inventory is falling, and the de - stocking pattern is obvious. Near the Spring Festival, order demand is okay, agricultural reserve demand is good. In industrial demand, compound fertilizer demand is stable, and melamine operating rate has declined. There is a large export price difference, but the domestic market is still oversupplied. The spot price of the delivery product is 1790 (+30), and the overall fundamentals are neutral [4]. - **Basis**: The UR2605 contract basis is 2, with a premium - discount ratio of 0.1%, which is neutral [4]. - **Inventory**: The UR comprehensive inventory is 1084 thousand tons (-0.5), 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 moving average, which is bullish [4]. - **Main Position**: The net position of the main UR contract holders is short, and the short position is decreasing, which is bearish [4]. - **Expectation**: The UR main contract is expected to fluctuate today. The operating rate is at a high level year - on - year. Although the Spring Festival is approaching, the downstream reserve demand is acceptable, and the inventory is being depleted [4]. Factors Affecting Urea - **Bullish Factors**: Inventory de - stocking and good reserve demand [5]. - **Bearish Factors**: Domestic market oversupply [5]. - **Main Logic**: International prices and marginal changes in domestic demand [5]. Market Data - **Spot Market**: The price of the spot delivery product is 1790, with a change of +30; the price of Shandong spot is 1790, with a change of +10; the price of Henan spot is 1790, unchanged; and the FOB China price is 3063 [6]. - **Futures Market**: The price of the 05 contract is 1788, with a change of +12; the basis is 2, with a change of +18; the price of UR01 is 1744, with a change of +12; the price of UR05 is 1788, with a change of +12; the price of UR09 is 1748, with a change of +10 [6]. - **Inventory Data**: The number of warehouse receipts is 10860, unchanged; the UR comprehensive inventory is 1084 thousand tons, with a change of -0.5; the UR manufacturer inventory is 919 thousand tons, and the UR port inventory is 165 thousand tons [6]. Supply - Demand Balance Sheet of Urea - From 2018 to 2024, the urea production capacity has been increasing year by year, with growth rates of 8.9% in 2019, 15.5% in 2020, 11.4% in 2021, 8.4% in 2022, 14.1% in 2023, and 13.5% in 2024. The production volume has also generally shown an upward trend. The net import volume and apparent consumption have also changed accordingly. The import dependence has fluctuated, and the consumption growth rate has also varied in different years. In 2025E, the production capacity is expected to reach 4906, with a growth rate of 11.0% [9].

Group 1: Report Summary - The report is a urea morning report dated December 23, 2025, provided by the Investment Consulting Department of Dayue Futures [2] Group 2: Industry Investment Rating - Not provided in the report Group 3: Core Viewpoints - The current daily production and operating rate of urea are stable, the comprehensive inventory has declined, and the de - stocking pattern is obvious. The agricultural and industrial demand is mainly on - demand, the operating rates of compound fertilizer and melamine are stable. The export internal - external price difference is large, the short - term export demand has declined, and the domestic urea supply still exceeds demand. The UR main contract is expected to fluctuate today [4] - The bullish factor is inventory de - stocking, and the bearish factors are domestic oversupply and new high in daily production. The main logic lies in international prices and marginal changes in domestic demand [5] Group 4: Summary by Related Catalogs Urea Fundamentals - The current daily production and operating rate are stable, the comprehensive inventory has declined, and the de - stocking pattern is obvious. The agricultural and industrial demand is on - demand, the operating rates of compound fertilizer and melamine are stable. The export internal - external price difference is large, the short - term export demand has declined, and the domestic urea supply still exceeds demand. The spot price of the delivery product is 1690 (unchanged), and the overall fundamentals are neutral [4] Basis - The basis of the UR2605 contract is - 8, and the premium - discount ratio is - 0.5%, which is neutral [4] Inventory - The UR comprehensive inventory is 1.318 million tons (- 40,000 tons), which is bearish [4] Futures Disk - The 20 - day moving average of the UR main contract is flat, and the closing price is below the 20 - day line, which is bearish [4] Main Position - The net position of the UR main contract is short, and short positions are increasing, which is bearish [4] Expectation - The UR main contract is expected to fluctuate, industrial demand is on - demand, inventory is being de - stocked, short - term export demand has declined, and the domestic oversupply is still obvious [4] Spot and Futures Quotes - The price of the spot delivery product is 1690 (unchanged), the price of the 05 contract is 1698 (+1), the basis is - 8 (- 1), the UR comprehensive inventory is 1.318 million tons (- 40,000 tons), etc. [6] Supply - Demand Balance Sheet - From 2018 to 2024, the urea production capacity has been increasing year - by year, with growth rates ranging from 8.4% to 15.5%. The production, net import volume, apparent consumption, etc. have also shown certain changes. For example, in 2024, the production capacity was 4418.5, the production was 3425, and the net import volume was 360 [9]

Report Information - Report Title: Urea Weekly Report [1] - Report Date: December 21, 2025 [1] - Analyst: Yang Honghan [1] Investment Rating - Not provided in the report Core Viewpoints - Short - term: Urea prices will fluctuate. Medium - term: There is support for urea prices. The driving force is neutral currently, and whether it turns positive depends on the continuity of mid - stream restocking. [2][3][4] Summary by Directory Supply Domestic Supply - Capacity: The expansion pattern of urea production capacity continued in 2025. In 2024, the total new production capacity was 3920000 tons, and in 2025, it was 6640000 tons. There are still plans for new capacity in 2026. [26] - Production: From December 11 - 17, 2025, China's urea production was 1.3659 million tons, a decrease of 19500 tons or 1.41% compared to the previous period. Next week, the weekly production is expected to be around 1.37 million tons, with a slight increase possible in the next cycle. [2] - Cost: Raw material prices have stabilized, and the factory's cash - flow cost line has risen. For example, the cash - flow cost and full cost of fixed - bed plants in Shanxi have changed in recent days due to coal price and cost factor fluctuations. [32] - Profit: Urea cash - flow cost - corresponding profit is currently in a profitable state. [37] - Net Import (Export): During the reserve period, export policies have tightened. The export volume in 2025 (E) shows certain trends, with significant increases in some months. [43] Production Enterprise Maintenance Plan - Many enterprises carried out maintenance in November and December 2025, including Yangmei Fengxi Fertilizer Industry, Linggu Chemical Group, etc. Some maintenance is routine, and some is due to cost - related losses. [28] Demand Domestic Demand - Agricultural Demand: Seasonally, agricultural demand is strengthening. High - standard farmland construction has increased the demand for urea from corn. The production cost, inventory, and production profit of compound fertilizers also reflect the demand situation. [49][52][56] - Industrial Demand: - Compound Fertilizer: The production capacity utilization rate, production cost, inventory, and production profit of compound fertilizers show the industry's fundamentals. [58] - Melamine: The production profit, market price, production volume, and production capacity utilization rate of melamine are presented. [59][60][61] - Real Estate: The demand from the real estate industry for panels has limited support, but panel exports are resilient. [62] Inventory - Factory Inventory: On December 17, 2025, China's total urea enterprise inventory was 1.1797 million tons, a decrease of 54500 tons or 4.42% compared to the previous week. De - stocking was mainly concentrated in North, Northeast, and Northwest China, while some main production and sales areas had slight inventory accumulation. [3][68] - Port Inventory: As of December 18, 2025 (week 51), China's urea port sample inventory was 138000 tons, an increase of 15000 tons or 12.20% compared to the previous period. [3][68] International Urea - Price: The report shows the price trends of Chinese large - granular urea FOB, Baltic large - granular urea FOB, Middle East large - granular urea FOB, and Brazilian large - granular urea CFR from 2018 - 2025. [71][72][73][74][75] Strategy - Unilateral: Short - term fluctuating, medium - term bullish. Near the time point of the trading peak - season expectation. - Spread: The 1 - 5 month spread is gradually entering a fluctuating pattern. After the premium of the 05 contract is compressed, it is recommended to take a long position in the 5 - 9 spread at low levels. - Cross - variety: Not available currently. [4]

Group 1: Report Overview - Report title: Urea Morning Report [2] - Report date: December 17, 2025 [2] Group 2: Investment Rating - No investment rating provided in the report Group 3: Core View - The current daily production and operating rate of urea are stable, the comprehensive inventory has declined, and the de - stocking pattern is obvious. The overall supply of domestic urea still exceeds demand, and it is expected that the trend of the UR contract today will be volatile [4] Group 4: Urea Overview Fundamental Analysis - The current daily production and operating rate of urea are stable, and the comprehensive inventory has declined. On the demand side, both agricultural and industrial demand are mainly based on needs. The operating rate of compound fertilizers has increased significantly year - on - year, and the operating rate of melamine is stable. The price difference between domestic and foreign exports is large, but the short - term export demand has declined, and the overall supply of domestic urea still exceeds demand. The spot price of the delivery product is 1670 (unchanged), and the overall fundamentals are neutral [4] Basis Analysis - The basis of the UR2601 contract is - 3, and the premium/discount ratio is - 0.2%, which is neutral [4] Inventory Analysis - UR comprehensive inventory is 1.357 million tons (- 38,000 tons), which is bearish [4] Disk Analysis - The 20 - day moving average of the UR main contract is flat, and the closing price is below the 20 - day line, which is bearish [4] Main Position Analysis - The net short position of the UR main contract has decreased, which is bearish [4] Expectation - The futures price of the urea main contract is weakly declining. Industrial demand is mainly based on needs, inventory is being de - stocked, short - term export demand has declined, and the overall domestic supply still significantly exceeds demand. It is expected that the UR contract will fluctuate today [4] Factors Affecting the Market - Bullish factor: Inventory de - stocking [5] - Bearish factors: Domestic supply exceeds demand; Daily production reaches a new high [5] - Main logic: International prices and marginal changes in domestic demand [5] Group 5: Market Data Spot Market - The price of the spot delivery product is 1670, unchanged; the price of Shandong spot is 1700, unchanged; the price of Henan spot is 1670, unchanged; the FOB China price is 2729 [6] Futures Market - The price of the 05 contract is 1673, down 8; the basis is - 3, up 8; the price of UR01 is 1630, up 1; the price of UR05 is 1673, down 8; the price of UR09 is 1681, down 6 [6] Inventory Data - The number of warehouse receipts is 11,214, down 31; UR comprehensive inventory is 1.357 million tons; UR manufacturer inventory is 1.234 million tons; UR port inventory is 123,000 tons [6] Group 6: Supply - Demand Balance Sheet - From 2018 to 2024, the urea production capacity has been increasing year by year, with a capacity growth rate ranging from 8.4% to 15.5%. The production, net import volume, apparent consumption, and actual consumption also show an overall upward trend, with certain fluctuations in the import dependence and consumption growth rate. The expected production capacity in 2025E is 49.06 million tons, with a growth rate of 11.0% [9]

Report Summary 1. Report Industry Investment Rating - Not provided in the given content 2. Core View of the Report - The urea market is expected to move in a volatile pattern in the short - term, with the price decline slowing down and entering an oscillatory phase. The upper limit is restricted by incremental warehouse receipts, while the lower limit is supported by continuous restocking from middle and downstream players. The current fundamental driver of urea is neutral, and the price is supported by the continuous reduction of explicit inventory. The 01 contract has a strong fundamental resistance level at 1700 yuan/ton and a support level between 1580 - 1600 yuan/ton [2][3] 3. Summary by Relevant Catalogs 3.1 Urea Fundamental Data - **Futures Market (01 Contract)**: The closing price was 1,643 yuan/ton, down 3 yuan from the previous day; the settlement price was 1,644 yuan/ton, down 7 yuan; the trading volume was 140,314 lots, a decrease of 76,397 lots; the open interest was 150,646 lots, a decrease of 16,428 lots; the warehouse receipt quantity was 11,477 tons, a decrease of 49 tons; the trading volume was 461.365 million yuan, a decrease of 254.325 million yuan. The basis in Shandong increased by 3, the basis of Fengxi - contract increased by 3, and the basis of Dongguang - contract decreased by 7. The spread of UR01 - UR05 of Henan Xinlianxin decreased by 4 [1] - **Spot Market**: The factory prices of Yankuang Xinjiang, Shandong Ruixing, Shanxi Fengxi, and Jiangsu Linggu remained unchanged. The price of Hebei Dongguang decreased by 10 yuan/ton. The trading prices in Shandong remained unchanged, while those in Shanxi decreased by 30 yuan/ton [1] - **Supply - side Key Indicators**: The operating rate was 79.60%, an increase of 1.00 percentage points, and the daily output was 192,480 tons, an increase of 2,420 tons [1] 3.2 Industry News - As of December 3, 2025, the total inventory of Chinese urea enterprises was 1.2905 million tons, a decrease of 73,400 tons from the previous week, a week - on - week decrease of 5.38%. The inventory in some provinces decreased, while that in others increased. The demand for reserves and exports has improved the urea fundamentals, and the driver has changed from downward to neutral. Whether the driver can turn upward depends on the continuity of middle - stream restocking [2] - In the short - term, as the urea price drops from a high level, the spot trading improved on Tuesday. The overall price decline is expected to slow down, and the market will enter an oscillatory pattern. Attention should be paid to spot trading and enterprise inventory data released by information providers [3] 3.3 Trend Intensity - The trend intensity of urea is 0, indicating a neutral trend [3]