9 hours Ago By [email protected] (MENAFN)
The ammonia is traditionally procured from energy-intensive and fossil fuels, contributing to greenhouse gas emissions. Most carbon dioxide emitted during ammonia production comes from the steam methane reforming (SMR) process for hydrogen production. In response, there is a growing shift towards developing green ammonia, which is produced using renewable energy sources and promises to reduce the industry's carbon footprint.
Moreover, human alteration of the global nitrogen cycle, mainly through the application of ammonia-based fertilizers, contributes to global decline in biodiversity, widespread air quality problems, and greenhouse gas emissions worldwide. Over the coming decades, ammonia has the potential to make a significant impact by contributing substantially to the reduction of greenhouse gas emissions. For Instance, in 2024, CF Industries Holdings, Inc.
and JERA Co., Inc. (JERA), Japan's largest energy company, executed a joint development agreement (JDA) to explore the development of greenfield low-carbon ammonia production capacity at CF Industries' Blue Point Complex in Louisiana.
Market DynamicsRising demand for ammonia-based fertilizers drives the global market Ammonia is a crucial component in nitrogen-based fertilizers such as urea, ammonium nitrate, and ammonium sulfate, which are essential for increasing crop yields. With the global population expected to reach 9.7 billion by 2050 (United Nations, 2023), food demand is surging, necessitating higher agricultural productivity.
Countries such as India, China, and the U.S. are heavily investing in fertilizer production to ensure food security.
Governments worldwide also provide fertilizer subsidies to support farmers, further driving ammonia consumption. For example, India's Nutrient-Based Subsidy (NBS) scheme ensures affordable ammonia-based fertilizers, boosting demand. Governments and private companies are heavily investing in new ammonia production facilities and transportation infrastructure.
For instance, the U.S. Department of Energy (DOE) announced USD 1.
2 billion in funding for clean hydrogen and ammonia projects in 2023. Similarly, Chinese firms will be leveraging the One Belt One Road initiative, a global infrastructure development strategy adopted by the Chinese government, to expand their presence overseas, including through planned investments such as a USD 6.75 billion renewable hydrogen (50,000 tons) and ammonia (250,000 tons) plant in Egypt's Suez Economic Zone aimed at exporting to Europe, a project in Morocco to produce 1.
4 million tons of renewable ammonia, and a project in Brazil to produce 60,000 tons of renewable ammonia. Such projects could be used to source ammonia for the Chinese market. Regional Analysis Asia Pacific is the largest ammonia market, driven by the increasing population and rising food demand in countries like China and India.
According to reports from organizations such as the Food and Agriculture Organization (FAO) and the International Fertilizer Association (IFA), Asia Pacific accounts for a substantial share of global fertilizer consumption, underscoring the pivotal role of ammonia in sustaining agricultural productivity and food security initiatives. For instance, Yara Clean Ammonia, a subsidiary of Norway's Yara International, and Greenko ZeroC, part of India's AM Green, have signed a term sheet to supply renewable ammonia from AM Green's Kakinada facility in India. The term sheet and offtake agreement cover the long-term supply of up to 50% of renewable ammonia from Phase 1 of AM Green's ammonia production site, which will produce and export renewable ammonia by 2027.
The North American region is a significant player in the global ammonia market, where the U.S. emerges as the dominant producer and consumer.
The U.S. produces a large amount of ammonia itself (the third largest) and is one of the top importers of ammonia owing to its usage in agriculture and allied activities.
The Republic of Trinidad and Tobago is the largest U.S. trade partner in ammonia, followed by Canada, and these two countries account for the majority of the U.
S. imports. Natural gas-based plants are the main source of ammonia production in the U.
S., accounting for approximately 92% of the country's ammonia production. Key Highlights MENAFN13032025004597010339ID1109310495 Legal Disclaimer: MENAFN provides the information “as is” without warranty of any kind.
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