Urea Market Analysis – Week Ending February 13, 2025

This report provides an in-depth analysis of the urea market, with a focus on the Middle East and the anticipated impact of India’s imminent return to the market.

Key Highlights:

• Sharp Price Surge in the Middle East: Speculation surrounding India’s re-entry into the market has fueled a significant price increase in the Middle East. Recent transactions in Qatar have been reported at $437–$438 per ton FOB, with another deal potentially closing at $445 or higher, reflecting the bullish trend.
• Impact on Indian Import Prices: Given these price levels, India is likely to receive offers exceeding $460 per ton CFR, marking a notable increase from its previous procurement at $422 and $427 per ton CFR.
• Strengthening Prices in Egypt and Algeria: Egyptian transactions have been recorded at $459 per ton FOB, while Algeria has seen deals at $460 per ton FOB, signaling a firm market in North Africa.
• European Market Momentum: Prices in Europe are also trending upward, albeit with a slight lag compared to replacement costs.
• Robust Demand in Southeast Asia and Australia: Strong demand in these regions is supporting price stability and encouraging traders to speculate on further price increases.
• Strengthening NOLA Market (USA): Transactions in NOLA have been concluded at $418 per ton FOB for February and $423 per ton for March, indicating a firming market. This may prompt some suppliers to redirect shipments from Brazil to the U.S.

Market Trends & Driving Factors:

The urea market is currently experiencing a strong upward trajectory, driven by several key factors:

• India’s Return to the Market: The anticipated demand from India could significantly influence global prices.
• Supply Constraints: Supply disruptions in regions such as Algeria are tightening availability and pushing prices higher.
• Robust Demand in Key Markets: Strong buying interest in Southeast Asia and Australia continues to support price strength.

Market Outlook:

In the short term, urea prices are expected to remain on an upward trajectory, driven by India’s procurement activities and ongoing supply constraints. The market is closely watching India’s upcoming IPL tender, which is expected to set the tone for price movements in the coming weeks.

In the long term, factors such as global production levels, demand fluctuations, and weather conditions will play a crucial role in determining market direction.

Stay tuned for further updates as we track key developments in the global urea market.