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The price of urea experienced a notable decline recently in August and continues to further extend the phase of declines in September, characterized by a general weakening of market conditions. The downward trend was initially driven by a combination of ample supply and relatively subdued demand, leading lower futures prices which in turn placed downward pressure on spot market transactions. A brief period of slight recovery was observed in the mid of August as futures prices showed temporary strength, though high inventory levels persisted and limited the extent of the rebound.

As the month progressed, prices fell more sharply, influenced significantly by the seasonal reduction in agricultural demand during the autumn period. With the primary application season concluded, purchasing enthusiasm among downstream users remained low, and trading sentiment grew increasingly cautious. Limited buying interest and an absence of significant improvement in demand further contributed to the overall softening of urea values. Looking ahead, supply levels are expected to remain elevated while agricultural offtake stays weak, suggesting that urea prices are likely to continue facing downward pressure in the near term.

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Moreover, China's shift in export policy, as reports indicated a potential relaxation of its previous ban allowing for a limited quantity of urea to be exported, weighed on the prices for urea. This development introduced additional supply into the global market, alleviating some of the tightness that had previously supported higher price levels. Furthermore, the decision by Indian state-owned entities to issue fresh import tenders, partly in response to China's changed stance, signaled robust future supply availability, which in turn tempered buying urgency and exerted downward pressure on prices. While international prices had been elevated due to strong demand and supply constraints, the anticipation of increased exports from China and the subsequent market reaction contributed to a softening of urea values in recent assessments.