Urea and nitrates

HOUSTON (ICIS)–The US delay of its proposed 50% tariffs on EU imports will still leave its polymers vulnerable to retaliatory tariffs. The new deadline is 9 July. For US exports, the EU has already drafted a list of targets for retaliatory tariffs, part of its second round of €95 billion in tariffs on US imports. A full list of all the proposed imports can be found here. This is on top of the first round of €21 billion in tariffs on US imports. A full list of all the proposed imports can be found here. In all, the EU could impose tariffs on nearly every major polymer from the US, including polyethylene (PE), polypropylene (PP), polystyrene (PS), polyvinyl chloride (PVC) and polyethylene terephthalate (PET). The EU is also considering tariffs on US imports of surfactants, fatty acids, fatty alcohols, and tall oil, a feedstock used to make renewable diesel, sustainable aviation fuel (SAF) and renewable naphtha. The following table lists some of the many plastics and chemicals proposed on the EU's second round of tariffs. CN CODE DESCRIPTION 28151200 sodium hydroxide "caustic soda" in aqueous solution "soda lye or liquid soda" 29053926 butane-1,4-diol or tetramethylene glycol [1,4-butanediol] having a bio-based carbon content of 100% by mass 29091910 tert-butyl ethyl ether (ethyl-tertio-butyl-ether, etbe) 29152100 acetic acid 29153200 vinyl acetate 29291000 isocyanates 32061100 pigments and preparations based on titanium dioxide of a kind used for colouring any material or produce colorant preparations, containing >= 80% by weight of titanium dioxide calculated on the dry matter (excl. preparations of heading 3207, 3208, 3209, 3210, 3212, 3213 and 3215) 32061900 pigments and preparations based on titanium dioxide of a kind used for colouring any material or produce colorant preparations, containing < 80% by weight of titanium dioxide calculated on the dry matter (excl. preparations of heading 3207, 3208, 3209, 3210, 3212, 3213 and 3215) 34023100 linear alkylbenzene sulphonic acids and their salts 34023990 anionic organic surface-active agents, whether or not put up for retail sale (excl. linear alkylbenzene sulphonic acids and their salts, and aqueous solution containing by weight 30-50% of disodium alkyl [oxydi(benzenesulphonate)]) 34024100 cationic organic surface-active agents, whether or not put up for retail sale 34024200 non-ionic organic surface-active agents, whether or not put up for retail sale (excl. soap) 34024900 organic surface-active agents, whether or not put up for retail sale (excl. soap, anionic, cationic and non-ionic) 34025010 surface-active preparations put up for retail sale (excl. organic surface-active preparations in the form of bars, cakes, moulded pieces or shapes, and organic surface-active products and preparations for washing the skin in the form of liquid or cream) 38030010 crude tall oil 38030090 tall oil, whether or not refined (excl. crude tall oil) 38170050 linear alkylbenzene 38170080 mixed alkylbenzenes and mixed alkylnaphthalenes, produced by the alkylation of benzene and naphthalene (excl. linear alkylbenzene and mixed isomers of cyclic hydrocarbons) 38231100 stearic acid, industrial 38231200 oleic acid, industrial 38231300 tall oil fatty acids, industrial 38231910 fatty acids, distilled 38231930 fatty acid distillate 38231990 fatty acids, industrial, monocarboxylic; acid oils from refining (excl. stearic acid, oleic acid and tall oil fatty acids, distilled fatty acids and fatty acid distillate) 38237000 fatty alcohols, industrial 38260010 fatty-acid mono-alkyl esters, containing by weight => 96,5 % of esters "famae" 38260090 biodiesel and mixtures thereof, not containing or containing < 70 % by weight of petroleum oils or oils obtained from bituminous minerals (excl. fatty-acid mono-alkyl esters containing by weight >= 96,5 % of esters "famae") 39013000 ethylene-vinyl acetate copolymers, in primary forms 39019080 polymers of ethylene, in primary forms (excl. polyethylene, ethylene-vinyl acetate copolymers, ethylene-alpha-olefins copolymers having a specific gravity of < 0,94, ionomer resin consisting of a salt of a terpolymer of ethylene with isobutyl acrylate and methacrylic acid and a-b-a block copolymer of ethylene of polystyrene, ethylene-butylene copolymer and polystyrene, containing by weight <= 35% of styrene, in blocks of irregular shape, lumps, powders, granules, flakes and similar bulk forms) 39021000 polypropylene, in primary forms 39023000 propylene copolymers, in primary forms 39029010 a-b-a block copolymer of propylene or of other olefins, of polystyrene, ethylene-butylene copolymer and polystyrene, containing by weight <= 35% of styrene, in blocks of irregular shape, lumps, powders, granules, flakes and similar bulk forms 39029020 polybut-1-ene, a copolymer of but-1-ene with ethylene containing by weight <= 10% of ethylene, or a blend of polybut-1-ene with polyethylene and/or polypropylene containing by weight <= 10% of polyethylene and/or <= 25% of polypropylene, in blocks of irregular shape, lumps, powders, granules, flakes and similar bulk forms 39031100 expansible polystyrene, in primary forms 39031900 polystyrene, in primary forms (excl. expansible) 39032000 styrene-acrylonitrile copolymers "san", in primary forms 39033000 acrylonitrile-butadiene-styrene copolymers "abs", in primary forms 39039090 polymers of styrene, in primary forms (excl. polystyrene, styrene-acrylonitrile copolymers "san", acrylonitrile-butadiene-styrene "abs", copolymer solely of styrene with allyl alcohol, of an acetyl value of >= 175 and brominated polystyrene, containing by weight >= 58% but <= 71% of bromine, in blocks of irregular shape, lumps, powders, granules, flakes and similar bulk forms) 39041000 poly"vinyl chloride", in primary forms, not mixed with any other substances 39042100 non-plasticised poly"vinyl chloride", in primary forms, mixed with other substances 39042200 plasticised poly"vinyl chloride", in primary forms, mixed with other substances 39051200 poly"vinyl acetate", in aqueous dispersion 39051900 poly"vinyl acetate", in primary forms (excl. in aqueous dispersion) 39052100 vinyl acetate copolymers, in aqueous dispersion 39052900 vinyl acetate copolymers, in primary forms (excl. in aqueous dispersion) 39053000 poly"vinyl alcohol", in primary forms, whether or not containing unhydrolyzed acetate groups 39061000 poly"methyl methacrylate", in primary forms 39071000 polyacetals, in primary forms 39072911 polyethylene glycols, in primary forms 39072920 polyether alcohols, in primary forms (excl. bis(polyoxyethylene) methylphosphonate and polyethylene glycols) 39072999 polyethers in primary forms (excl. polyether alcohols, polyacetals and copolymer of 1- chloro-2,3-epoxypropane with ethylene oxide) 39073000 epoxide resins, in primary forms 39074000 polycarbonates, in primary forms 39075000 alkyd resins, in primary forms 39076100 poly"ethylene terephthalate", in primary forms, having a viscosity number of >= 78 ml/g 39076900 poly"ethylene terephthalate", in primary forms, having a viscosity number of < 78 ml/g 39079110 unsaturated liquid polyesters, in primary forms (excl. polycarbonates, alkyd resins, poly"ethylene terephthalate" and poly"lactic acid") 39079190 unsaturated polyesters, in primary forms (excl. liquid, and polycarbonates, alkyd resins, poly"ethylene terephthalate" and poly"lactic acid") 39079980 polyesters, saturated, in primary forms (excl. polycarbonates, alkyd resins, poly"ethylene terephthalate", poly"lactic acid", poly"ethylene naphthalene-2,6-dicarboxylate" and thermoplastic liquid crystal aromatic polyester copolymers) 39089000 polyamides, in primary forms (excl. polyamides-6, -11, -12, -6,6, -6,9, -6,10 and -6,12) 39091000 urea resins and thiourea resins, in primary forms 39092000 melamine resins, in primary forms 39093100 poly"methylene phenyl isocyanate" "crude mdi, polymeric mdi", in primary forms 39094000 phenolic resins, in primary forms 39095010 polyurethane of 2,2'-"tert-butylimino"diethanol and 4,4'-methylenedicyclohexyl diisocyanate, in the form of a solution in n,n-dimethylacetamide, containing by weight >= 50% of polymer 39095090 polyurethanes in primary forms (excl. polyurethane of 2,2'-"tert-butylimino"diethanol and 4,4'-methylenedicyclohexyl diisocyanate, in the form of a solution in n,ndimethylacetamide) Source: EU CN CODE DESCRIPTION 39011010 linear polyethylene with a specific gravity of < 0,94, in primary forms 39011090 polyethylene with a specific gravity of < 0,94, in primary forms (excl. linear polyethylene) 39012010 polyethylene in blocks of irregular shape, lumps, powders, granules, flakes and similar bulk forms, of a specific gravity of >= 0,958 at 23°c, containing <= 50 mg/kg of aluminium, <= 2 mg/kg of calcium, of chromium, of iron, of nickel and of titanium each and <= 8 mg/kg of vanadium, for the manufacture of chlorosulphonated polyethylene 39012090 polyethylene with a specific gravity of >= 0,94, in primary forms (excl. polyethylene in blocks of irregular shape, lumps, powders, granules, flakes and similar bulk forms, of a specific gravity of >= 0,958 at 23°c, containing <= 50 mg/kg of aluminium, <= 2 mg/kg of calcium, of chromium, of iron, of nickel and of titanium each and <= 8 mg/kg of vanadium, for the manufacture of chlorosulphonated polyethylene) 39014000 ethylene-alpha-olefin copolymers, having a specific gravity of < 0,94 , in primary forms 39081000 polyamides-6, -11, -12, -6,6, -6,9, -6,10 or -6,12, in primary forms Source: EU

27-May-2025

SAO PAULO (ICIS)–Brazil’s state-owned energy major Petrobras and chemicals producer Unigel have finally signed an agreement to end contractual disputes related to the two fertilizers plants in the country’s north which had been leased to Unigel. Late on 22 May, the companies said the two fertilizers plants in the states of Bahia and Sergipe (northeast) would thus return to Petrobras’ portfolio. The agreement must still be ratified by Brazil’s Arbitral Tribunal. “The agreement provides for the reinstatement of Petrobras' possession of the fertilizer plants (FAFENs) in Bahia and Sergipe, and the resumption of operations by Petrobras through a bidding process for the contracting of operation and maintenance services, in compliance with applicable governance practices and internal procedures,” said Petrobras. “Petrobras aims to resume activities in the fertilizer segment to create value through the production and commercialization of nitrogen-based products, while aligning with the oil and natural gas production chain and the energy transition.” Meanwhile, Unigel said the agreement represented the “definitive resolution of the contractual disputes” and litigation existing between the companies due to disagreements about the lease for the two plants. The deal represents the withdrawal of the company from the fertilizers sector altogether. The Camacari plant in Bahia state can produce 475,000 tonnes/year of ammonia and 475,000 tonnes/year of urea. The plant in Laranjeiras, Sergipe, can produce 650,000 tonnes/year of urea, 450,000 tonnes/year of ammonia and 320,000 tonnes/year of ammonium sulphate (AS). FAILED FERTILIZERS ADVENTURE The agreement puts an end to the 10-year lease for the plants signed by Unigel and Petrobras in 2019. While successful at first, as fertilizers prices shot up immediately after the first wave of the COVID-19 pandemic, prices started to fall in 2022 though while prices for natural gas rose sharply. In 2024, Unigel idled the two plants as high prices for gas and low selling prices made operations unprofitable, it said. Along the way, Petrobras accused Unigel of not fulfilling the terms and conditions of what they had agreed. Moreover, from 2022, woes at Unigel’s petrochemicals divisions – mostly producing styrenics – added to those in fertilizers. By the end of 2023, the company was forced to enter a debt restructuring process from which it only emerged in 2024. Earlier in May, Unigel presented its first comprehensive quarterly financial metrics since 2023, when it entered the restructuring process. Brazil’s financial regulations provide for such a provision for companies in financial distress. While it posted small earnings before interest, taxes, depreciation, and amortization (EBITDA), the producer continued haemorrhaging money in the first quarter, with sales falling year on year and posting a net loss of Brazilian reais (R) 209 million ($37 million). ($1 = R5.71)

23-May-2025

LONDON (ICIS)–The European Parliament made the decision to impose higher tariffs on fertilizers and certain agricultural products from Russia and Belarus on Thursday. The new rates are expected to come into effect from 1 July, to give stakeholders time to prepare for the changes. The move is a significant one, aimed at addressing both food security concerns within the EU and limiting financial resources available to Russia amid its ongoing conflict with Ukraine. Tariffs on nitrogen-based fertilizers will increase gradually over three years, starting from 6.5% + €40/tonne from 1 July 2025 and potentially reaching around 100%. This steep rise in tariffs is designed to make trade economically unfeasible. An additional duty of 50% will be applied to specific farm produce imported from these countries. EU tariffs for urea, AN, CAN and UAN of Russian origin Time period Proposed tariff From 1 July 2025 until 30 June 2026 6.5% ad valorem + €40/tonne From 1 July 2026 until 30 June 2027 6.5% ad valorem + €60/tonne From 1 July 2027 until 30 June 2028 6.5% ad valorem + €80/tonne From 1 July 2028 6.5% ad valorem + €315/tonne ad valorem "according to the value" The primary goal of these tariffs is twofold: To safeguard EU food security by reducing dependency on imports that may be compromised due to geopolitical tensions. To limit the revenue streams that support Russian military operations in Ukraine. These measures could lead to increased prices for fertilizers and affected agricultural products within the EU, impacting farmers’ production costs. There may also be shifts in supply chains as producers seek alternative sources or adjust their strategies in response to higher import costs. This action reflects broader efforts by the EU to respond strategically to international conflicts while ensuring stability within its own markets. Thumbnail image source: Shutterstock

22-May-2025

LONDON (ICIS)–Relatively stable demand and evolving global supply dynamics are expected in European ammonia and acrylonitrile (ACN) markets in 2025. In this latest podcast, global ammonia editor Sylvia Traganida and Europe ACN editor Nazif Nazmul share the latest developments and expectations for what lies ahead. Ammonia players are expecting European demand from the nitrates market to pick up soon Availability is due to tighten with scheduled turnarounds in Saudi Arabia and Indonesia Ammonia prices globally are softening due to a lack of major demand Geopolitics-led macroeconomic challenges dampen prospects of ACN derivatives demand resurgence Balanced-to-long ACN supply dynamics anticipated to endure

20-May-2025

BANGKOK (ICIS)–The US tariff policies and other economic headwinds present significant challenges for chemical exporters in the Gulf Cooperation Council (GCC) region. Nevertheless, opportunities and avenues for cooperation exist, especially with Asia, according to the secretary general of the Gulf Petrochemicals and Chemicals Association (GPCA). "Navigating the complexities of global trade is a top priority," Abdulwahab Al Sadoun told ICIS on the sidelines of the Asia Petrochemical Industry Conference (APIC) 2025. The GCC region comprises six Middle Eastern countries: Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates (UAE). The GPCA plays a pivotal role in facilitating partnerships between companies in both the GCC region and China, a strategy that has gained momentum in recent years, Al Sadoun said. "We estimate that GCC chemical producers hold equity in joint ventures processing approximately 2.7 million barrels/day of crude and operating over 23 million tonnes per year of downstream petrochemical capacity across China, South Korea, Malaysia and Singapore," said Al Sadoun. While US tariff policies present significant challenges for GCC chemical exporters, Al Sadoun sees opportunities amid the turbulence. “Even a baseline 10% tariff will raise the price of GCC chemical products in the US market,” Al Sadoun said, citing a paper published by GPCA that highlighted the potential effects of US President Donald Trump’s tariffs. Some products that would be particularly affected are high-volume, price-sensitive exports such as urea, paraxylene (PX) and polyethylene terephthalate (PET). However, Asia’s dominance as a trading partner offers a silver lining. “Asia accounted for over half of our total exports in 2023," Al Sadoun said, with China, India and Turkey among key markets. "If China reduces imports from the US, the GCC can step in to fill that gap, provided we act swiftly to capture market share and diversify our trade partners,” said Al Sadoun. Asia also accounts for well over half of global plastics consumption, with more than 50% of all GCC chemical exports already flowing to Asia, Al Sadoun added. “Recent joint ventures, such as Aramco’s partnerships at Panjin and Gulei in China, both designed around crude‑to‑chemicals schemes that convert more than 50% of each barrel directly into petrochemical feedstock, demonstrate how upstream strength can be paired with local finishing capacity,” Al Sadoun said. GCC CHEM PRODUCERS HAVE COMPETITIVE EDGEAmid falling oil prices in 2025, Al Sadoun believes chemical producers in the Gulf still hold an advantage over competitors reliant on naphtha. “While crude oil prices may be falling, the Arabian Gulf’s gas-based model still gives chemical producers a clear cost edge over their naphtha-reliant competitors.” At the same time, he emphasized the importance of continuing to optimize energy use and focus on higher-value projects. Companies are channeling investments into specialty elastomers, crude-to-chemicals complexes and downstream sectors such as mobility, packaging and electric vehicle (EV) materials, Al Sadoun said. “With plant utilization in the Arabian Gulf running in the 90% range – far above most global peers – the region is well placed to ride out softer oil, provided it keeps lowering variable costs and broadening its product slate. “GPCA’s role is to benchmark those cost and efficiency gains across its membership and ensure best practice spreads quickly from one site to the entire Gulf cluster.” SUPPLY CHAIN RESILIENCE A KEY FOCUSSupply chain resilience has emerged as a critical focus for Arabian Gulf chemical producers. “Recent shocks, such as geopolitical flare-ups, pandemic-era port closures, even weather-driven canal disruptions, have confirmed that leading companies cannot simply react; they must anticipate, adapt and seize the openings that turbulence creates,” Al Sadoun said. Al Sadoun pointed out four lessons: the first, route flexibility; the second, the need for end-to-end visibility; third, the need for regional buffer stocks such as joint warehouses in key import markets; and lastly, digital risk forecasting. The use of tools such as artificial intelligence (AI), blockchain and the Internet of Things (IoT) are moving supply chain management from reactive to predictive, while diversified sourcing and strategic inventories reduce single region dependency, Al Sadoun said. FOCUS ON RENEWABLES Even as the GCC region continues to leverage its cost advantage through gas, its member countries are also committed to energy transition. “GCC nations aim to source 25-50% of their energy mix from renewables by 2030,” Al Sadoun said, adding that the region is also investing heavily in carbon capture, utilization and storage (CCUS), currently capturing 4.4 million tonnes of CO2 annually – 10% of the global CCUS capacity. Hydrogen production is another priority, with Oman, the UAE and Saudi Arabia setting ambitious targets. Oman has committed to producing 1 million tonnes of hydrogen by 2030, the UAE to 1.4 million tonnes of hydrogen by 2031 and Saudi Arabia aims for 4 million tonnes of hydrogen by 2030. "These initiatives are part of our strategy to reduce environmental impact while maintaining our competitive edge," Al Sadoun emphasized. APIC 2025 runs in Bangkok, Thailand, from 15-16 May. Interview article by Jonathan Yee (recasts paragraphs 1 and 7 for clarity)

16-May-2025

LONDON (ICIS)–Fertiglobe has agreed to acquire Wengfu Australia’s distribution assets as part of a strategic expansion strategy, the urea and ammonia producer said on Monday. The acquisition will expand the Abu Dhabi-headquartered firm’s downstream reach and enhance access to Australian customers. It currently supplies around 600,000 tonnes/year of urea to the country. The purchase price of Wengfu will be based on net asset value plus a premium of around $8 million, with the final amount to be determined at closing. “Acquiring Wengfu’s assets marks a strategic step in our value-driven growth strategy and accelerates our commercial footprint in Australia, one of the world’s fastest-growing agricultural regions,” said Fertiglobe CEO Ahmed El-Hoshy. Fertiglobe said the transaction was expected to be 2.8% and 4.1% earnings per share (EPS) accretive before synergies in 2026 and 2027 respectively. Closing of the deal is subject to customary regulatory and legal approvals, it added in a statement.

12-May-2025

HOUSTON (ICIS)–CF Industries said in its latest nitrogen fertilizer market outlook that in the near-term it expects the global supply-demand balance to remain constructive. The producer highlighted in its earnings release that global pricing was supported in Q1 of 2025 by positive global demand, constrained availability due in part to natural gas shortages in Iran, and China’s continued restrictions on urea exports. CF said there is anticipated strong demand from not only global corn stocks-to-use ratio reaching its lowest level since 2013, but because there is below average global inventories and challenging production economics in Europe. Looking at North America, CF said there should be strong nitrogen demand during the spring application season due to favorable returns for corn compared to soybeans, which is driving higher planted corn acres in 2025. The producer noted that the US Department of Agriculture (USDA) reported in March that growers intend to plant 95.3 million acres of corn this season. For Brazil, the company expects the country will remain the largest urea import region, with imports projected to exceed 8 million tonnes, with this outlook supported by strong planted corn acreage and continued nominal domestic nitrogen production. In India, there is less urea inventory with CF saying that lower-than-targeted domestic production and higher year on year urea sales pushed urea inventory levels down by approximately 35% compared to March 2024. As a result, their management expects higher urea import requirements for the rest of this year to meet grower demand and replenish urea stocks. Across Europe the producer is projecting that ammonia operating rates and overall domestic nitrogen product output will remain below historical averages over the long-term given the region’s status as the global marginal producer. For China, CF said the ongoing urea export controls continue to limit availability from the country with minimal volumes concluded in Q1 of 2025. The company feels that urea exports will not resume until the conclusion of China’s domestic spring application season at the earliest. In Russia, urea exports are expected to increase 3% in 2025 due to the start-up of new urea granulation capacity and the willingness of certain countries to purchase Russian fertilizer, including the US and Brazil. CF also is expecting that over the medium-term the significant energy cost differentials between North American producers and high-cost producers in Europe and Asia are expected to persist. As a result, the global nitrogen cost structure would then remain supportive of strong margin opportunities for low-cost North American producers. In the longer-term view CF is projecting that the global nitrogen supply demand balance will further tighten as global capacity growth over the next four years is forecasted to not keep pace with the expected rise in global demand. Those needs are anticipated to have a growth rate of approximately 1.5% per year for traditional applications and see more new demand emerging for clean energy applications. CF has a view that global production will remain constrained by poor margins for European ammonia producers and availability of natural gas in Egypt, Iran and Trinidad.

08-May-2025

LONDON (ICIS)–Europe melamine editor Melissa Hurley interviews senior editor Sylvia Traganida, deputy managing editor Deepika Thapliyal, and market reporters Joy Foo and Connor Phillips. Market factors to consider ahead of May: Asia melamine market grappling with weak demand and increasing supply Asia exports dropped in March but expected to flow into Europe in May/June Reduced melamine supply in Europe offset by ongoing sluggish demand conditions No tariff impact on US melamine so far Global urea demand expected to slow from H2 May China not resuming urea exports yet despite the domestic season ending Subdued European ammonia demand; waiting for nitrates market to pick up Natural gas TTF prices soften, but European fertilizer producers reluctant to ramp up production due low demand To listen in a separate window, click here. Additional reporting from Sylvia Traganida, deputy managing editor Deepika Thapliyal, market reporters Joy Foo and Connor Phillips.

29-Apr-2025

MUMBAI (ICIS)–State-owned National Fertilizers Ltd (NFL) plans to acquire an 18% stake in a proposed joint venture (JV) that will build a 1.27 million tonne/year urea plant at Namrup in India’s eastern Assam state. NFL plans to invest Indian rupees (Rs) 5.72 billion ($67 million) in the Namrup IV Fertilizer Plant, the company said in a disclosure to the Bombay Stock Exchange (BSE) on 18 April. The state government of Assam will hold a 40% stake in the proposed joint venture; with NFL and Oil India Ltd (OIL) each holding an 18% stake. Hindustan Urvarak & Rasayan Ltd (HURL) will own 13% and Brahmaputra Valley Fertiliser Corp (BVFCL) will have the remaining 11%. The project, which will be set up within the complex operated by BVFCL, is expected to cost Rs106 billion, it added. The plant is expected to be commissioned within 48 months of the project launch, NFL said, adding that once operational, the plant will help meet the growing demand for urea in northeast India. The Indian government approved the proposal for the new project on 19 March 2025 as part of its effort to reduce urea imports. Indian finance minister Nirmala Sitharaman had announced the project during her budget speech on 1 February 2025. It will be the eighth plant with the same capacity that will be built in the south Asian country since 2019. ($1 = Rs85.12)

21-Apr-2025

SINGAPORE (ICIS)–Arab Gulf (AG) ammonia annual average export price is forecast to ease further this year (see Chart 1) as producers are expected to keep prices competitive to maintain market shares in Asia, particularly as weak Asian demand for industrial applications including acrylonitrile (ACN) and caprolactam (capro) have capped ammonia prices. AG ammonia producers are expected to maintain its export prices in 2025 at just below parity with southeast Asian producer with FOB AG at around 97% of FOB SE Asia prices (see Chart 2) to optimize returns while keeping market shares in their key India and Taiwan markets. AG ammonia producers’ netbacks in Taiwan and India in 2025 are projected to return to levels similar to 2020 before the Russian-Ukraine war with AG FOB at around 89% and 84% of CFR Taiwan and CFR India prices, respectively (see Chart 3) Asia remains an important market for AG producers particularly when their returns from Europe have been shrinking. AG ammonia producers’ FOB netbacks from Europe is expected to remain constrained in 2025 with the FOB AG annual price hovering at around 63% of the CFR NWE annual price, following two years of higher returns in 2022 and 2023. (see Chart 4) AG ammonia producers have not been exporting much to Europe except for 2022 and 2023 when outbreak of the Russia-Ukraine conflict and subsequent sanctions on Russian exports created a window of opportunity for AG producers. (See Chart 5) Europe ammonia import prices are expected to remain elevated as high natural gas prices had led several ammonia plants in the region to be permanently shut in 2022, with the ammonia prices remaining tied to the prices of key exporters Trinidad and Algeria. Egypt also exports ammonia to Europe, but its production has been susceptible to disruptions caused by natural gas shortages as seen in Q3 last year and February this year. Europe import prices are expected to ease if Russia resumes exports to Europe hence a burning question for importers is when Togliattiazot’s (TOAZ's) export terminal at Russia’s Taman Port would start loading ammonia. TOAZ is part of the Uralchem Group, and the terminal was expected to start loading ammonia in Q1 this year. Ammonia is a feedstock for inorganic fertilizers such as urea and ammonium sulphates and chemicals such as acrylonitrile (ACN). With contributions from Song Hea Beom, Sylvia Traganida

28-Mar-2025