LAHORE - The urea prices have surged from $254/MT to $290/MT in the international market, marking a growth of over 16 percent in one week.

The price hike has been on account of increase in international coal prices and reduction in urea production in China due to plant closures.

The international coal prices have also surged from $87/MT last month in Aug 2017 to $93/MT, recording a 7 percent monthly and 41 percent annual growth.

Weak demand on the international front along with the unexpected increase in global coal prices have resulted in a drastic rise in urea production costs. This coupled with a few plant closures in China have led to reduction in production levels, thereby decreasing Chinese urea exports.

Experts said that reduction in exports by China is easing int’l urea market scenario; making room for other participants and hence creating a price hike globally as witnessed last week. This international urea price increase is also expected to bode well for the local fertilizer players due to higher export-realized prices and anticipated ease off in domestic inventory levels.