Global Urea market prevailed pessimistic trend during the inaugural week of March 2025, despite of increasing feedstock Ammonia prices. This current decline in Urea predominantly driven by delay in India’s Urea tender, which seemed to be the only viable demand during the review period amidst mostly restricted demand from elsewhere. The delay created uncertainty in the market with buyers refraining from buying Urea further exerting downward pressure on Urea pricing.

In the Indian market, Urea prices remained stable, influenced by a more closely matched demand-supply scenario.  Further, the Government of India's fixed Maximum Retail Price (MRP) exclusive of taxes and neem coating charges, played a pivotal role in maintaining price stability. Furthermore, in terms of supply, domestic production exceeded demand during initial March 2025, traditionally low-consumption months, allowing India to delay new urea purchase tenders and exert downward pressure on global prices. Additionally, purchasing activity for urea from the domestic fertilizer market remained moderate, with no significant fluctuations observed during the review period.  Insights gathered from various market participants suggest that Indian Potash Ltd (IPL), a key Urea procurer of Urea in the regions, is expected to procure approximately 1 million metric tons of urea, with laycan schedules extending through April. However, immediate bulk purchasing remained subdued, allowing India to strategically time its import tenders to secure favorable pricing in the global market.

Similarly, in the Russian market remained stable during the inaugural week of March 2025. This stagnancy in prices is primarily attributed to a more closely matched supply-demand dynamics.  On the supply side, sufficient urea inventories within the European market, along with stable production levels across key manufacturing regions. Further, to maintain sufficient domestic fertilizer availability, the Russian government has extended export quotas until May 31, 2025.  Additionally, the Russian Fertilizer Producers Association (RFPA) anticipates that fertilizer production in 2025 could increase to 64-65 million tones, with exports expected to exceed 42 million tones. In terms of demand, despite the upcoming planting season for key crops such as wheat, sunflower seed, sorghum, and rice, traders have been actively replenishing inventories to ensure sufficient supply for agricultural needs. This proactive stocking has provided some support for overall market demand.

As per ChemAnalyst, it is anticipated that the Urea prices may increase in the short term. With the most viable Urea tender from the Indian expected to release soon the buying activity may further, revive creating upward pressure on Urea prices. Additionally, restocking activities in the European market are also expected amidst the forthcoming planting season.