Report Industry Investment Rating - Not provided in the report Core Viewpoint - The current downward space for urea is limited, and it is recommended to pay attention to the opportunity of buying on dips for the 01 contract. The reasons are that from a valuation perspective, urea has fallen to a certain level of cost - effectiveness with relatively low upstream profits; from a driving perspective, there are two potential upward drivers: expected supply - side renovation of old devices (about 20% of urea devices are over 20 years old and the current comprehensive operating rate is close to 80% with limited idle capacity) and expected improvement in demand - side exports (optimistic about urea exports from September to October due to the easing of China - India relations) [1] Summary by Relevant Catalogs Urea Futures Price - On September 28, UR01 closed at 1664 yuan/ton, down 5 yuan or 0.30% from September 26; UR05 closed at 1715 yuan/ton, down 5 yuan or 0.29%; UR09 closed at 1735 yuan/ton, down 5 yuan or 0.29% [1] Domestic Spot Price (Small - Granule) - On September 28, prices in Shandong, Shanxi, and Henan remained unchanged at 1600 yuan/ton, 1490 yuan/ton, and 1610 yuan/ton respectively; prices in Hebei were 1640 yuan/ton, down 10 yuan or 0.61%; prices in Northeast China were 1650 yuan/ton, down 10 yuan or 0.60%; prices in Jiangsu remained at 1600 yuan/ton [1] Basis and Spread - On September 28, the basis of Shandong spot - UR was - 115 yuan/ton, up 5 yuan from September 26; the spread of 01 - 05 was - 51 yuan/ton, unchanged [1] Upstream Cost - On September 28, the anthracite prices in Henan and Shanxi remained unchanged at 1000 yuan/ton and 880 yuan/ton respectively [1] Downstream Price - On September 28, the prices of compound fertilizer (45%S) in Shandong and Henan remained at 2930 yuan/ton and 2520 yuan/ton respectively; the prices of melamine in Shandong and Jiangsu remained at 5100 yuan/ton and 5200 yuan/ton respectively [1] Important Information - On the previous trading day, the opening price of the main urea futures contract 2601 was 1666 yuan/ton, the highest price was 1668 yuan/ton, the lowest price was 1639 yuan/ton, the closing price was 1664 yuan/ton, and the settlement price was 1657 yuan/ton [1] Trading Strategy - Pay attention to the opportunity of buying on dips for the 01 contract [1]

Report Industry Investment Rating - No relevant information provided. Report's Core View - Although the current spot price of urea is fluctuating downward due to strong supply and weak demand, from the perspectives of valuation and drivers, it is recommended to focus on the opportunity of buying at low prices after the spot price stabilizes. It is suggested to pay attention to the buying opportunity of the 01 contract at low prices [1]. Summary According to Relevant Catalogs Urea Futures and Spot Prices - On September 15, compared with September 12, UR01 increased by 20 yuan/ton to 1683 yuan/ton, a change of 1.20%; UR05 increased by 13 yuan/ton to 1731 yuan/ton, a change of 0.76%; UR09 increased by 180 yuan/ton to 1750 yuan/ton, a change of 11.46% [1]. - Among domestic spot prices, Shandong decreased by 20 yuan/ton to 1640 yuan/ton, a change of -1.20%; Henan decreased by 10 yuan/ton to 1640 yuan/ton, a change of -0.61%; Jiangsu decreased by 10 yuan/ton to 1640 yuan/ton, a change of -0.61%. The prices in Shanxi, Hebei, and Northeast remained unchanged [1]. Basis and Spread - The basis of Shandong spot - UR decreased by 33 yuan/ton to -91 yuan/ton; the spread of 01 - 05 increased by 7 yuan/ton to -48 yuan/ton [1]. Upstream and Downstream Prices - The prices of anthracite coal in Henan and Shanxi remained unchanged at 1000 yuan/ton and 880 yuan/ton respectively; the prices of compound fertilizer (45%S) in Shandong and Henan remained unchanged at 2950 yuan/ton and 2550 yuan/ton respectively; the price of melamine in Shandong decreased by 17 yuan/ton to 5083 yuan/ton, a change of -0.33%, and the price in Jiangsu remained unchanged at 5300 yuan/ton [1]. Important Information - On the previous trading day, the opening price of the main contract 2601 of urea futures was 1666 yuan/ton, the highest price was 1688 yuan/ton, the lowest price was 1665 yuan/ton, the closing price was 1683 yuan/ton, and the settlement price was 1679 yuan/ton [1]. Long - Short Logic - Recently, the anti - involution sentiment of coking coal has a tendency to rise again. The sharp rise of coking coal in the night session yesterday drove the sentiment of the coal chemical industry to be strong [1]. - From a valuation perspective, the current urea price is oscillating at a low level, and the upstream profit is also at a relatively low level, so the urea valuation is not high [1]. - From a driving perspective, there are two possible upward drivers for the urea price in the second half of the year. First, there is an expectation of renewal and transformation of old devices on the supply side, with about 20% of urea devices over 20 years old, and the current comprehensive operating rate of urea is over 80%, with little idle capacity. Second, there is an expectation of improvement in exports on the demand side. With the easing of Sino - Indian relations, the urea exports from September to October are quite promising [1].