Urea futures slide to $416/t, down 28% on the month as oversupply weighs

The futures benchmark eased to about $416 per tonne on June 4, down roughly 6% on the day and about 28% over the month, according to Trading Economics. On a physical basis, Middle East FOB urea has dropped to about $630 per tonne but remains roughly 28% above pre-conflict levels, per Argus assessments compiled by IFDC.

Three factors dominate: ample global supply, a seasonal lull in buying after the Northern Hemisphere application window, and China’s gradual return to the export market. An easing of the Gulf shipping risk premium has also taken pressure off prices.

Phosphate supply remains tighter than nitrogen. DAP has held around $869 to $875 per tonne and MAP near $907 to $927 per tonne, keeping phosphates elevated even as urea retreats. The divergence leaves nitrogen as the weakest major nutrient in the current market.

Lower urea prices ease nitrogen bills heading into the back half of the season. As a rule of thumb, a $30-per-tonne move in urea shifts U.S. corn nitrogen costs by roughly $15 to $20 per acre, a meaningful swing for growers managing tight margins.

The near-term path hinges on how quickly China clears export volumes and on the timing of the next major Indian tender. Traders expect demand to firm later in the summer, which could put a floor under prices.