Group 1: Report's Investment Rating - No investment rating provided in the report Group 2: Core View - The current sentiment of urea has improved, but the reversal may not have arrived yet based on supply and demand. The current market is mainly driven by short - position holders taking profit. It is recommended to hold the previously sold out - of - the - money put options. The current urea valuation is at a relatively low level, reflecting the situation of strong supply and weak demand. If prices continue to fall, upstream production willingness may decline, accelerating enterprise clearance. In the short term, the upward driving force for urea is insufficient, with large supply and inventory pressure. The downstream is cautious about restocking at low prices. Future potential drivers include the renovation of old chemical industry equipment on the supply side and the issuance of new export quotas [1] Group 3: Summary by Directory Urea Futures Price - On October 29, compared with October 28, UR01 increased by 0.55% (9 yuan/ton), UR05 increased by 0.53% (9 yuan/ton), and UR09 increased by 0.63% (11 yuan/ton) [1] Domestic Spot Price - On October 29, compared with October 28, prices in Shandong, Henan, and Jiangsu decreased by 0.62%, 0.63%, and 0.63% respectively (10 yuan/ton each), prices in Shanxi decreased by 0.68% (10 yuan/ton), while prices in Hebei and Northeast remained unchanged [1] Basis and Spread - The basis of Shandong spot - UR decreased by 19 yuan/ton, and the spread of 01 - 05 remained unchanged [1] Upstream Cost - On October 29, compared with October 28, the price of anthracite coal in Shanxi increased by 5.68% (50 yuan/ton), while prices in Shandong and Henan remained unchanged [1] Downstream Price - On October 29, compared with October 28, prices of compound fertilizer (45%S) in Shandong and Henan, and prices of melamine in Shandong and Jiangsu remained unchanged [1] Important Information - The opening price of the main urea futures contract 2601 was 1638 yuan/ton, the highest price was 1652 yuan/ton, the lowest price was 1633 yuan/ton, the closing price was 1644 yuan/ton, and the settlement price was 1643 yuan/ton. The position of 2601 was 270,349 lots [1] Trading Strategy - Hold the sold out - of - the - money put options [1]

| | | | | 尿素早评20251028: 情绪好转，反转存疑 | | | | | --- | --- | --- | --- | --- | --- | --- | --- | | | 日慶 | 变化值 | 单位 | 10月27日 | 10月24日 | | 変化值 | | | | UR01 | 元/呼 | 1640.00 | 1642.00 | (絶対值) -2.00 | (相对值) -0.12% | | | | UR05 | 元/吨 | 1713.00 | 1719.00 | -6.00 | -0.35% | | 尿素期货价格 | | | | | | | | | | (收盘价) | UR09 | 元/吨 | 1745.00 | 1748.00 | -3.00 | -0.17% | | | | 山东 | 元/吨 | 1610.00 | 1570.00 | 40.00 | 2.55% | | 期现价格 | | 山西 | 元/吨 | 1500.00 | 1500.00 | 0.00 | 0.00% | | 国内现货价格 | | 河南 | 元/吨 | 1590.00 | 1570.00 | 20.00 | 1 ...

Core Viewpoint - The recent market volatility is driven by intense corrections in speculation, raising questions about whether the current supply-side policy-driven rally has ended or is merely a "backward catch" opportunity [3][8]. Policy Analysis - The government has emphasized the need to combat deflation through supply-side policies, such as halting the addition of excess capacity and promoting domestic consumption. The scope of supply rationalization measures has expanded to include metals, petrochemicals, and industries like lithium and coal, which have reported supply disruptions [3][9]. - Historical responses to deflation have varied, with the current situation being unique due to the predominance of advanced capacity and the fragmented industrial landscape, alongside high government debt limiting fiscal space [3][9][10]. Commodity-Specific Insights - Lithium prices have rebounded but remain below marginal cash costs of $11,500/ton, with approximately 45% of global capacity unable to cover cash costs at a price of $9,000/ton. This suggests limited downside potential for prices [4][13]. - Recent compliance checks in the lithium sector may lead to short-term supply disruptions, with around 20,000 tons of lithium capacity facing compliance risks, potentially resulting in significant inventory depletion and price rebounds [14]. - In the coal sector, production inspections are focused on preventing overproduction, with expectations of moderate impacts. However, recent price declines may limit further downside [5][15]. Agricultural Sector Developments - The hog farming industry is actively responding to regulatory controls by reducing breeding sow inventories and adjusting market weights, which may support near-term price stability and long-term valuation increases [6][16]. Market Trends and Expectations - The bond market reflects expectations of prolonged deflation, with government policies aimed at supply-side constraints potentially boosting industrial prices and improving upstream profits. This may reduce the urgency for monetary easing [6][17]. - The recent surge in government infrastructure investment, such as the $1.2 trillion Tibet dam project, has also contributed to supply concerns and influenced market dynamics [6][17].