Global Ammonia Market Size By End-user (Fertilizers, Chemicals, Pharmaceuticals, Refrigeration), By Application (Agriculture, Industrial, Household & Commercial), By Geographic Scope And Forecast

Ammonia Market Size And Forecast

Ammonia Market size was valued to be USD 83.22 Billion in the year 2024 and it is expected to reach USD 134.47 Billion in 2031, at a CAGR of 6.82 % over the forecast period of 2024 to 2031.

• Ammonia (NH3), a colorless gas with a strong, acrid smell, is a mixture of nitrogen and hydrogen. It is produced artificially by mixing hydrogen and nitrogen from the atmosphere in the Haber-Bosch process, and it naturally arises from the breakdown of organic matter.
• Ammonia is a common fertilizer used in agriculture because it provides the nitrogen needed for plant growth. Additionally, it is essential to the production of chemicals utilized in numerous industrial applications, such as nitric acid and urea.
• Even though ammonia is used, excessive amounts of it can be hazardous. In addition to irritating to the eyes and respiratory system, exposure can harm aquatic ecosystems and water quality when released into bodies of water.

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Global Ammonia Market Dynamics

The key market dynamics that are shaping the global ammonia market include:

Key Market Drivers

• Growing demand for nitrogen-based fertilizers in agriculture: The increasing global population and the need for improved crop yields are driving the demand for ammonia-based fertilizers. According to the Food and Agriculture Organization (FAO) of the United Nations, global fertilizer consumption is projected to reach 201 million tonnes in 2022. The International Fertilizer Association (IFA) reports that ammonia-based fertilizers account for approximately 50% of all nitrogen fertilizers used worldwide, highlighting the significant role of ammonia in agricultural productivity.
• Expansion of industrial applications: Ammonia is widely used in various industrial processes, including the production of plastics, textiles, and cleaning products. The American Chemistry Council states that the U.S. chemical industry, a major consumer of ammonia, is expected to grow by 3.9% in 2023. Furthermore, the International Energy Agency (IEA) projects that ammonia could account for up to 45% of global shipping fuel demand by 2050, as it is considered a promising alternative fuel for maritime transport.
• Increasing adoption of green ammonia production: The push for sustainability and reduced carbon emissions is driving interest in green ammonia production. The International Renewable Energy Agency (IRENA) estimates that green hydrogen-based ammonia production could reach 400 million tonnes per year by 2050, representing about 70% of the expected global ammonia market. Additionally, the Hydrogen Council predicts that the cost of green ammonia production could decrease by up to 60% by 2030, making it increasingly competitive with conventional ammonia production methods.

Key Challenges:

• Environmental concerns and regulatory pressure: The production and use of traditional ammonia contribute significantly to greenhouse gas emissions. According to the International Energy Agency (IEA), ammonia production accounts for about 1.3% of global CO2 emissions. The United Nations Environment Programme reports that agriculture, which heavily relies on ammonia-based fertilizers, is responsible for 10-12% of global greenhouse gas emissions. As a result, many countries are implementing stricter regulations on ammonia production and use. For instance, the European Union’s Farm to Fork Strategy aims to reduce fertilizer use by at least 20% by 2030, potentially impacting ammonia demand in the region.
• Volatility in natural gas prices: Natural gas is a key feedstock for ammonia production, and fluctuations in its price directly affect the ammonia market. The U.S. Energy Information Administration (EIA) reports that natural gas prices can be highly volatile, with the Henry Hub spot price ranging from $1.63 to $6.45 per million British thermal units (MMBtu) between 2020 and 2022. This volatility can significantly impact production costs and, consequently, the profitability of ammonia manufacturers. The International Fertilizer Association (IFA) estimates that natural gas costs can account for up to 80% of the total production cost of ammonia in some regions.
• Safety concerns and transportation challenges: Ammonia is a hazardous substance that requires careful handling and transportation. The U.S. Occupational Safety and Health Administration (OSHA) reports that exposure to high concentrations of ammonia can cause severe health effects and even death. According to the U.S. Environmental Protection Agency (EPA), there were 897 reported ammonia releases between 2007 and 2016, resulting in 19 deaths and 1,651 injuries. These safety concerns lead to stringent regulations and increased transportation costs. The American Chemistry Council estimates that the cost of rail transportation for chemicals, including ammonia, has increased by 30% since 2015, partly due to safety-related regulatory requirements.

Key Trends:

• Shift towards green ammonia production: The ammonia industry is increasingly moving towards sustainable production methods. According to the International Energy Agency (IEA), green ammonia production could reach 100 million tonnes per year by 2050, representing about 20% of total ammonia production. This shift is driven by the need to reduce carbon emissions in the ammonia sector, which currently accounts for about 1.3% of global CO2 emissions.
• Growing demand in emerging economies: Developing countries are experiencing a surge in ammonia demand, particularly for agricultural use. The Food and Agriculture Organization (FAO) projects that fertilizer consumption in sub-Saharan Africa will grow by 40% between 2015 and 2030. The International Fertilizer Association (IFA) expects India’s nitrogen fertilizer demand to increase by 1.3% annually through 2024, driving ammonia consumption.
• Expanding applications in energy storage: Ammonia is gaining traction as an energy storage medium and alternative fuel. The International Renewable Energy Agency (IRENA) estimates that ammonia could account for 45% of global shipping fuel demand by 2050. Additionally, the Hydrogen Council predicts that ammonia-based energy storage capacity could reach 70 TWh by 2030, representing a significant market opportunity for ammonia producers.

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Global Ammonia Market Regional Analysis

Here is a more detailed regional analysis of the global ammonia market:

Asia Pacific

• Asia Pacific substantially dominates the Global Ammonia Market owing to the region’s expanding population and agricultural intensification driving significant demand for ammonia-based fertilizers.
• According to the Food and Agriculture Organization (FAO), Asia accounts for nearly 60% of global fertilizer consumption. China alone uses approximately 30% of the world’s nitrogen fertilizers. The FAO projects that fertilizer demand in South Asia will grow by 3.3% annually through 2030, further boosting ammonia consumption in the region.
• The robust industrial growth in Asia Pacific fuels ammonia demand across various sectors. The United Nations Industrial Development Organization (UNIDO) reports that Asia’s share of global manufacturing value added increased from 31.6% in 2000 to 50.5% in 2021. In particular, China’s chemical industry, a major ammonia consumer, is projected to grow at an annual rate of 5-7% through 2025, according to the China Petroleum and Chemical Industry Federation.
• Asia Pacific countries are increasingly exploring ammonia as a clean energy carrier. Japan, for instance, aims to use 3 million tons of ammonia annually in its power sector by 2030. The International Energy Agency (IEA) predicts that ammonia could meet up to 45% of global shipping energy demand by 2050, with Asia Pacific playing a crucial role in this transition due to its significant maritime industry.

North America

• North America is anticipated to witness the fastest growth in the Global Ammonia Market during the forecast period driven by the region’s rapid embracing of sustainable ammonia production.
• The U.S. Department of Energy projects that green hydrogen-based ammonia could capture up to 60% of the ammonia market by 2050. A report by the Ammonia Energy Association indicates that over 50 green ammonia projects have been announced in North America since 2020, representing a potential production capacity of over 30 million tonnes per year by 2030.
• The agricultural sector in North America continues to drive ammonia demand. The U.S. Department of Agriculture reports that nitrogen fertilizer consumption in the United States increased by 4% in 2022, reaching 12.8 million nutrient tons. The Fertilizer Institute predicts a 2.5% annual growth in nitrogen fertilizer demand through 2025, fueling the expansion of the ammonia market.
• Ammonia is gaining traction as a solution for reducing industrial emissions. The U.S. Environmental Protection Agency estimates that selective catalytic reduction (SCR) systems, which use ammonia to control NOx emissions, can achieve up to 90% NOx reduction in industrial applications. The North American SCR market is expected to grow at a CAGR of 7.2% from 2021 to 2028, driving increased ammonia consumption in the region.

Global Ammonia Market Segmentation Analysis

The Global Ammonia Market is Segmented based on End User, Application, and Geography.

Ammonia Market, By End User

• Fertilizers
• Chemicals
• Pharmaceuticals
• Refrigeration

Based on the Product Type, the Global Ammonia Market is segmented into Fertilizers, Chemicals, Pharmaceuticals, and Refrigeration. The Fertilizers segment is dominant, in the Global Ammonia Market as ammonia is primarily used to produce nitrogen-based fertilizers for agriculture.

Ammonia Market, By Application

• Agriculture
• Industrial
• Household & Commercial

Based on the Raw Material, the Global Ammonia Market is segmented into Agriculture, Industrial, Household & Commercial. The Agriculture segment is dominant, in the Global Ammonia Market owing to its extensive use in fertilizers for crops.

Ammonia Market, By Geography

• North America
• Europe
• Asia Pacific
• Rest of the World

Based on Geography, the Ammonia Market is segmented into North America, Europe, Asia Pacific, Rest of the World. Asia Pacific substantially dominates the Global Ammonia Market owing to the region’s expanding population and agricultural intensification driving significant demand for ammonia-based fertilizers. According to the Food and Agriculture Organization (FAO), Asia accounts for nearly 60% of global fertilizer consumption. China alone uses approximately 30% of the world’s nitrogen fertilizers. The FAO projects that fertilizer demand in South Asia will grow by 3.3% annually through 2030, further boosting ammonia consumption in the region.

Key Players

The “Global Ammonia Market” study report will provide valuable insight with an emphasis on the global market including some of the major players of the industry are CF Industries Holdings Inc., Yara International, Nutrien Ltd, OCI N.V., and Qatar Fertilizer Company.

This section offers in-depth analysis through a company overview, position analysis, the regional and industrial footprint of the company, and the ACE matrix for insightful competitive analysis. The section also provides an exhaustive analysis of the financial performances of mentioned players in the given market.

Our market analysis offers detailed information on major players wherein our analysts provide insight into the financial statements of all the major players, product portfolio, product benchmarking, and SWOT analysis. The competitive landscape section also includes market share analysis, key development strategies, recent developments, and market ranking analysis of the above-mentioned players globally.

Global Ammonia Market Recent Developments

• In April 2024, CF Industries announced the green ammonia project in Louisiana CF Industries, a leading nitrogen fertilizer manufacturer, unveiled plans for a $2 billion green ammonia facility in Ascension Parish, Louisiana. The project aims to produce 1.4 million metric tons of green ammonia annually using renewable energy and electrolysis.
• In March 2024, Yara and JERA announced the collaboration on blue ammonia production Norwegian fertilizer giant Yara International and Japanese power generator JERA signed a memorandum of understanding to jointly develop blue ammonia production facilities. The project, set to begin construction in 2025, will utilize carbon capture and storage technology to produce low-carbon ammonia for both fertilizer and energy applications. This partnership highlights the growing interest in ammonia as a clean energy carrier.
• In November 2023, Mitsubishi Heavy Industries announced the partnership with Infinium for e-fuels production Mitsubishi Heavy Industries (MHI) announced a strategic partnership with Infinium to develop e-fuels production facilities using green ammonia as a feedstock. The collaboration aims to produce carbon-neutral synthetic fuels for the transportation sector, particularly focusing on aviation and shipping?.

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