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Urea - the 10 year outlook
Market Forecasts

Urea - The 10 Year Forecast
Urea - The 10 Year Outlook
2008 October issue
Recent Developments
Price

• Urea prices followed a rising trend in 2007. The beginning of 2008 showed the market slightly weaker but prices picked up in March.

• Prices started to increase very rapidly in April and reached record highs in July 2008 on the back of robust demand in North and South America, South Asia fuelled by high crop prices, the delay of new capacities coming on-stream and the 135% Chinese export tariff applied on urea in April 2008 which created fears of urea availability. 

• The price rally continued until the end of Q2 and prices started to retreat in August. 

• Indian importing agencies’ reluctance to buy and choosing to rather wait and see whether the urea prices would drop, led to a price decrease in September 2008.

• October saw a vertical drop of urea prices on the back of deteriorating financial markets, rapidly falling crop prices, fierce competition between traders and limited demand for urea in the international markets.

• In the same month, China was pushed out of the market as their product became uncompetitive due to the 175% export tax and the lower international prices for urea.

Urea Ten Year Forecast


Urea Ten Year Forecast and Market Analysis Service Annual Report from British Sulphur Consultants

British Sulphur Consultants’ Urea Ten Year Forecast and Market Analysis Service gives subscribers a comprehensive insight into the global urea industry, fully informing the reader of the current urea market and also future trends over the next decade.

Key Questions Covered in the Report

Where will demand growth be strongest? Why will this be the case?

What are the new markets for urea? Where and why have they emerged?

Where and when will new capacity be built? What factors will influence this?

When and where will capacity rationalisation occur? Why will certain plants close and others remain open?

How will supply and demand developments affect the urea market? Why will this affect the urea price?

How will urea trade evolve? Which regions will emerge as key urea exporters or importers?

What are the forecast annual prices out to 2016? Why will prices change?

Urea prices are currently at record highs. Demand for urea in emerging markets to grow crops, enabling burgeoning populations to be fed, is increasing rapidly. In Developed regions, new standards for nitrous oxide emissions and increased crop planting for biofuel production are driving up urea demand.

Investment in urea production facilities is extensive, but concentrated in regions where feedstock costs are the lowest. Over the next three to four years this investment will create a situation of oversupply in the urea market. Prices will begin to soften in sympathy with oversupply of the market.

The softening of the urea price towards 2010 will deter new investment in urea production facilities, and result in closure of uncompetitive plants. Therefore tightening the market, allowing demand to increase more rapidly than supply. This will bring about a price recovery towards 2016, as the peak of the next price cycle is reached.

The report covers these questions and others in detail, presenting a complete picture of the present and future urea market.

Components of the Service

The Urea Ten Year Forecast and Market Analysis Service includes:

  • A paper copy of each quarterly report
  • The same documents are available for the Update Reports through British Sulphur Consultant’s online facility, for which subscribers to the UreaTen Year Forecast and Market Analysis Service are given free access.
  • Access to the authors for consultation.
  • Access to the Nitrogen quarterly conference calls following report publication

Contact
For more information, please contact:

Stephen Ostercamp
Senior Account Manager, Business Development
tel: +44 20 7903 2129
fax: +44 20 7833 4342
email: Stephen.Ostercamp@crugroup.com

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