ICIS provides independent and unbiased pricing information, news and market analysis for the global Ammonia market. Our network of price reporters, based in Asia, Europe and the US, deliver local insight for each of these markets, which is published in our individual weekly and daily price reports.
If you buy or sell Ammonia or related products, our reports, news and market intelligence will give you the prices and analysis of the factors driving the prices that you need to make confident commercial decisions.
Updated to Q2 2021
Unscheduled lengthy shutdowns at large plants in Saudi Arabia and Indonesia brought some chaos to the market in May and June, with several buyers and traders left scrabbling to source significant volumes from west of Suez. The capacity cuts not only pushed up spot and contract prices on an almost weekly basis but triggered a string of deals that saw cargoes move from Mexico, Trinidad and north Africa to countries across northeast Asia.
With prices firming strongly and consistently due to the regional supply squeeze, spot buyers only dared venture into the market as a matter of necessity. Lost output from key units in the Middle East and southeast Asia was replaced, but at a price and with a wait, given replacement volumes were only available farther afield. Despite the shortage, few buyers cut downstream run rates as fertilizer and chemicals prices and margins remained relatively attractive.
Unlike in some other regions of the world, little change was seen in supply in Europe with no major planned or unplanned capacity cuts. While prices of natural gas increased, ammonia prices also firmed and manufacturers’ margins remained decent. The usual stream of contract volume from plants operated by leading producers in Russia, Ukraine, Algeria and Trinidad and Tobago underlined the stable scenario for market participants during the reporting period.
With a strong uptick in demand for spot cargoes from buyers east of Suez, European buyers were on the sidelines for most of the quarter, with few spot deals done for delivery to ports across the continent. Indeed, this lack of interest was illustrated by EuroChem’s sale of a spot cargo to Koch for April loading for discharge in the US Gulf, rather than to a regional buyer.
Barring an extended outage at the Waggaman, Louisiana, ammonia plant operated by Incitec Pivot Limited (IPL) and a short shutdown at Nutrien’s Geismar plant in the same state due to heavy rains, no capacity cuts were announced. Only one cargo was exported from the US during the quarter, with Trammo agreeing a swap with Nutrien for material that was delivered to southern Chile in June.
Demand from the agricultural sector was strong and steady as favourable crop prices supported buying activity in many farming regions. Inventories had been lower than usual following the series of plant outages amid the severe cold weather that struck in the previous quarter. In addition, firming prices in fertilizers that contain ammonia also meant import demand from the Caribbean was decent with a constant flow of cargoes from Trinidad & Tobago to the US Gulf.
We offer the following regional Ammonia analysis and news coverage to keep you informed of factors and developments affecting prices in the Ammonia marketplace.
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Ammonia is one of the main sources of nitrogen in fertilisers, as it contains 82% of nitrogen (N), which is essential for the life of plants. Ammonia (NH3) is produced through a chemical reaction (electrolysis).
Ammonia is a colourless, highly water-soluble gas with an intense, pungent, suffocating odour. It is alkaline and caustic, corrosive to copper and galvanised surfaces and is a powerful irritant. It is soluble in chloroform, ether and is easily liquefied under pressure. Liquid ammonia will attack some forms of plastics, rubber, and coatings.
Ammonia’s major use is as a nitrogen source in fertilisers where it is both applied directly and used to produce derivatives including ammonium nitrate, urea, ammonium phosphates and ammonium sulphate.
Urea plants are integrated with ammonia production as they require the carbon dioxide by-product from ammonia units.
Ammonia also has a number of industrial end uses. Ammonium nitrate is used to make explosives while the medical grade is decomposed to nitrous oxide (laughing gas). Ammonium bicarbonate has applications in baking powder formulations, in fire extinguishers and as a blowing agent in the manufacture of polymers.
Ammonia is used in the production of hexamethylene diamine (HMDA) for nylon, acrylonitrile (ACN) for fibres and plastics, caprolactam for nylon, isocyanates for polyurethanes, and hydrazine.
Other uses for ammonia include as a refrigerant, a cleaning and bleaching agent, and a household cleaner. It is also used in metal treating operations.
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