This week (5.11-15), the domestic liquid ammonia market continued its weak supply and demand pattern, with prices accelerating downward. The quotations in the main production areas have generally been lowered, and the market performance has been sluggish. Downstream procurement is mainly based on demand and observation. According to the Commodity Analysis System of Shengyi Society, as of May 15th, the mainstream ex factory price in Shandong was 2150-2350 yuan/ton, and the weekly decline of liquid ammonia was 16.69%.

Supply side: Limited impact of maintenance capacity, loose supply performance
This week, the operating rate of liquid ammonia remained at a high level, and the domestic ammonia release only increased without decreasing, with an operating rate of nearly 90%. On the one hand, there are few maintenance devices, and some devices are delayed in entering maintenance. On the other hand, many devices have entered the resumption period. The market supply performance is abundant, and enterprise inventory is accumulating at a high level. Under pressure, large factories have repeatedly lowered prices. Manufacturers in Shandong region have generally lowered prices 3-4 times this week, with price adjustments ranging from 200 to 400 yuan.
Demand side: Poor demand from both workers and farmers, sluggish exports
The peak season for spring plowing in the north has basically come to an end, while the demand for fertilizers in the south is mainly based on demand, and agricultural demand has entered the off-season. The operating rate of phosphate fertilizer has dropped below 50%, and the price of ammonia has lost support. Downstream products such as urea have all experienced varying degrees of decline, with a weekly drop of 2.28% for urea. There is no bright spot in industrial demand, and downstream production of caprolactam and acrylonitrile has not increased. Downstream purchases are mostly made on demand, and there is no growth point in demand.
In addition, in terms of exports, orders are flat, international ammonia prices are declining, and the price difference with domestic ammonia prices is further narrowing, resulting in a reduction in export order profits. This will have a certain impact on the domestic ammonia market.
Future prospects
According to the liquid ammonia analyst from Shengyi Society, the domestic ammonia market may maintain a sluggish trend in the short term. Considering the current large amount of ammonia in the market and high inventory, it cannot be ruled out that companies still have some room for price reduction. However, caution should be exercised as planned maintenance of facilities in the northwest and other regions in the middle to late part of the year is expected to alleviate supply pressure. In addition, the downstream phosphate fertilizer production rate is expected to increase, and the ammonia market may gradually stop falling in the future, with the possibility of a recovery market in the latter half of the year.