Urea: Correlation
Prices it moves with, and why
Urea is made from ammonia and carbon dioxide, and is the most traded nitrogen fertiliser. Its price follows gas costs, Chinese export curbs and big import tenders, notably India's, where farm prices are fixed and the government subsidises the gap.
Market price World Bank Pink Sheet: urea, Middle East US$/t · monthly, Jan 2006 to Sep 2026What its price moves with
Selected linkUrea and Ammonia
Monthly changes 0.27 weak correlation 12-month changes 0.82 strong correlation Last 5 years 0.39 monthly changes Lead or lag −1 mo Urea tends to lead by 1 month (r 0.41) Price function, Jan 2006 to Sep 2026 Urea ≈ 0.376 × (Ammonia)1.15 R² 0.69 On this fit, a 10% higher ammonia price goes with a 11.5% higher urea price over the long run. Units: US$/t and index (BLS base period).Chart: Urea and Ammonia prices rebased to 100 at Jan 2006, log scale
Both prices rebased to 100 at Jan 2006, on a log scale so equal percentage moves look the same size.Chart: Urea price against Ammonia price, monthly, log scales, with fitted line
Each dot is one month; paler dots are older (2006), darker dots recent (2026); the ringed dot is the latest month. The dashed line is the fitted price function. Both axes are logarithmic.Urea is made from ammonia at the same plant, so ammonia cost and urea price move together over time. The US nitrogen fertiliser proxy moves with Middle East urea at 0.27 monthly and 0.82 yearly.
weak co-movement month to month · 249 months Show chartsGas is the main input to ammonia and so to urea, and high gas prices shut European capacity. European gas moves with urea at 0.18 monthly and 0.70 yearly, as Middle East producers use cheaper contracted gas.
little or none co-movement month to month · 249 months Show chartsIndian urea plants run on pooled gas, much of it imported LNG, so LNG prices drive Indian production cost and the subsidy bill. The Japan LNG price moves with urea at 0.11 monthly and 0.63 yearly, partly because LNG is often oil-indexed.
little or none co-movement month to month · 249 months Show chartsFarmers buy nitrogen and phosphate together before planting, and both trade on the same import tenders and freight. DAP moves with urea at 0.45 monthly and 0.80 yearly, the strongest monthly tie for urea.
moderate co-movement month to month · 249 months Show chartsGrain prices decide how much fertiliser farmers can afford. Maize moves with urea at only 0.06 monthly but 0.60 yearly, because farm demand reacts with a season's lag. Rice and wheat matter as much in India, where urea is applied heavily.
little or none co-movement month to month · 249 months Show chartsUrea-formaldehyde resins for wood panels are the largest non-farm use. The basic organics proxy moves with urea at 0.13 monthly and 0.63 yearly. Resin makers buy technical-grade urea, so panel and furniture demand adds a steady industrial floor under the fertiliser price.
little or none co-movement month to month · 249 months Show chartsHow to read these numbers
Correlation of monthly changes (the number in the coloured pill) compares how much each price moved, month by month, since 2006 or the first month both series exist. It runs from −1 to +1: near +1 the two usually rise and fall in the same months, near 0 there is no link, and a negative number means they tend to move in opposite directions. Above 0.7 is strong, 0.4 to 0.7 moderate, 0.2 to 0.4 weak.
12-month changes compare year-on-year moves, which shows whether two prices share the same cycles even when the month-to-month noise differs.
Price function is a straight-line fit of the two prices on logarithmic scales: price ≈ k × (partner price)β. β is how much this price moves, in per cent, for a 1% move in the partner over the whole period, and R² is the share of the variation the fit explains. Two prices that both drift up with inflation can fit well without any real link, so read it together with the monthly correlation.
Lead or lag checks whether the monthly correlation is clearly higher when one price is shifted by 1 to 6 months.
Correlation is not cause. The reasons on each card explain the economic link; the numbers show how strongly it has shown up in prices. Proxy series are US producer price indexes or related prices and can blur the real link.
Data: World Bank Commodity Price Data (Pink Sheet), October 2026; US Bureau of Labor Statistics producer price indexes, IMF primary commodity prices and US EIA prices via FRED, Federal Reserve Bank of St. Louis, retrieved November 2026. Calculations by this site.