Ammonia
Ammonia (NH3) is a compound composed of nitrogen and hydrogen, crucial in various industrial processes. It ranks among the most extensively manufactured inorganic chemicals globally, with its production contributing significantly to the world’s energy expenditure.
Around 90% of the produced ammonia serves as a primary ingredient in fertilizers or is utilized in the synthesis of other nitrogen-based fertilizers, such as urea, supporting agricultural productivity on a global scale.
While the lion’s share of ammonia produced is captive, the seaborne trade in ammonia currently totals close to 20m. tonnes. The spot trade of this product plays a major role in dictating global ammonia values with key price benchmarks including those in North Africa, the Middle East, Trinidad and the US Gulf.
Recent shifts in feedstock dynamics have impacted ammonia production economics. Escalating prices of coal and natural gas in 2021 through end-2023, key raw materials in ammonia synthesis, led to substantial cost escalations across several regions, particularly in Europe and China. This has resulted in the temporary closure of numerous production plants and a subsequent surge in ammonia prices, thereby influencing market dynamics and trade flows for a sustained period.
Emerging advancements in technology and sustainability initiatives are poised to revolutionize the ammonia industry in the coming decades. Green ammonia technologies, which involve the production of ammonia using renewable energy sources such as wind or solar power, hold the potential to significantly alter the industry landscape.
Over the next 10-20 years, the adoption of these eco-friendly methods could mitigate environmental impacts associated with traditional ammonia production, reduce dependence on fossil fuels, and enhance the sustainability profile of the fertilizer sector. Such developments represent a pivotal opportunity to address energy consumption and environmental concerns while ensuring the continued supply of essential agricultural inputs.
Through the Profercy Nitrogen Service, Profercy provides expert market analysis of global ammonia markets and prices. This includes weekly price assessments for all major pricing points, such as:
- Baltic fob
- US Gulf cfr (spot)
- US Gulf fob (spot)
- Trinidad fob (spot)
- Arabian Gulf fob (spot)
- NW Europe cfr duty free/pd
- North Africa cfr
- Baltic fob
- Tampa cfr
- India cfr (spot)
Full price history going back several years is available to subscribers via the Profercy Hub.
