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Wide Use of Ammonia in Multiple End-use Industries

Ammonia is a colorless gas with a distinct odor also known as a building-block chemical and a key component in the manufacture of many products people use every day. It is found naturally in the environment through air, soil, and water, and plants and animals, including humans. Moreover, ammonia is a primary building block for ammonium nitrate fertilizer, which discharges nitrogen, a necessary nutrient for growing plants, including farm crops and lawns. Most ammonia produced across the world is used in fertilizer to maintain food production. The composition of food crops normally depletes soil nutrient supplies. Most farmers rely on ammonia-based fertilizers to keep the soil productive and maintain healthy crops. With the growing demand for food production and the increasing dependence on fertilizers, the global ammonia market is anticipated to grow during the forecast period.

Ammonia is broadly popular as a refrigerant gas and widely used in air-conditioning equipment. The properties of ammonia help absorb ample amounts of heat from its surroundings. In addition, the use of ammonia to purify water supplies is generating more demand for ammonia. Ammonia plays an important role as a stabilizer, neutralizer, and a source of nitrogen in the waste and wastewater treatment, cold storage, rubber, pulp, paper, and food & beverage industries. Moreover, ammonia is being used as a building block in various manufacturing products including plastics, explosives, textiles, pesticides, and colors. Ammonium byproducts such as ammonium hydroxide are an essential ingredient in many household cleaning products, including tubs, sinks, toilets, countertops, and tiles. The various uses of ammonia for almost every end user is expecting a heavy surge in the demand for the ammonia market during the projected period.

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Halt of End-Use Industries Hinders Demand for Ammonia

The global demand for ammonia is expected to remain inactive during the pandemic years and is predicted to receive increasing growth in the post-COVID-19 era. In addition to the flattening population growth, COVID-19 has led to a heavy drop in global economic activities. Notwithstanding the austerity of the shock of the pandemic, top ammonia producers are expected to proceed with their upcoming ammonia projects. Major leading ammonia producing nations are anticipated to contribute more than 45 million tons per annum, with India and Iran leading the market. The global ammonia projects that are at their initial stages of growth are facing delays, due to increased assurance regarding phasing and completion timelines, but it relies largely on the span and austerity of the COVID-19 outbreak.

The COVID-19 pandemic is witnessing mixed reactions from major ammonia manufacturers, with only a few businesses declaring cuts in their capital expenditure for the current year as a critical and proactive measure. In order to maintain long-term competitiveness and growth, businesses aim to dynamically optimize production and prepare their finances. However, some businesses may postpone the investment to after the COVID-19 is over. Manufacturers continue to estimate their capital structure to recognize further cost-effective financing opportunities. Moreover, as many global economies had to follow strict lockdown measures due to the growing spread of the coronavirus, halt of various end-use industries of ammonia, workforce, and limited supply chain had a huge impact on the ammonia market. Nevertheless, rapid vaccination drives and developing healthcare innovations are likely to restore the market growth shortly.

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Constant Demand for Ammonia in Nitrogen Fertilizers in Most Nations

Ammonia is a significant part of the global nitrogen industry. More than 80% of the global ammonia is used for nitrogen fertilizers. Nitrogen fertilizers are the most extensively used fertilizers in the world, estimating close to 60% of all composts. Most of the global ammonia is produced from natural gas. However, in China, much of the ammonia is produced from the coal gasification. Ammonia is treated into downstream fertilizer produce before being utilized in the soil. These products include urea, ammonium nitrates, ammonium sulfate, ammonium phosphates, and nitrogen solutions. The use of ammonia in industrial applications is growing faster than its use in fertilizers, and is expected to further grow in the near future. Ammonia is used to create ammonium nitrates that are used to make explosives. It is also used in the manufacturing of acrylonitrile for acrylic fibers and plastics, hexamethylenediamine for nylon 66, caprolactam for nylon 6, isocyanates for polyurethanes and hydrazine, and various amines and nitriles. All these factors are anticipating growth of the ammonia market during the forecast period.

The world has been undergoing a weaker nutrient requirement in recent years, due to poor economic outlooks, lower crop, and food prices, rising competition, and varying energy prices. A decrease in fertilizer rates has had a notable impact on fertilizer producers’ earning potential. Although there have been capacity cutbacks, merger decisions, and cost-cutting actions, fertilizer production, and import levels have continued to be strong. The demand for ammonia fell drastically in 2020, due to the ongoing pandemic, mostly owing to logistics and financial issues. However, the market is projected to overcome current restraints as soon as things start to work normally. As future capacity additions will continue to outpace consumption, the global ammonia market is expected to grow during the projected period.

High Demand for Ammonia in Pharmaceutical Industry

The use of ammonia in various end-use industries, including pharmaceutical, agriculture, pulp & paper, textiles, and mining is significantly being affected by the demand. A rise in the global demand for food has led to notable growth in the use of fertilizers to increase the production output per available area of farmland. The increasing demand for ammonia for fertilizers in developing countries is driving the expansion of the ammonia market. Moreover, ammonia is being significantly used in the preparation of various drugs and compounds, including amines, nitriles, hydrogen cyanide, hydrazine, hydroxylamine, ammonium carbonate, phenol, urea, and amino acids. The global rise in the use of ammonia in the manufacture of drugs and vaccines and its popular use in fertilizers and other end-use applications are expected to drive the global ammonia market. The market is anticipated to reach US$ 34 Bn by 2031, expanding at a CAGR of ~2% during the forecast period.

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Analysts’ Viewpoint

One of the major factors fueling the growth of the ammonia market is increasing demand for ammonia in the agriculture industry and its rising usage for the production of explosives. However, uncertain effects of ammonia in its concentrated form are likely to hamper the growth of the ammonia market. Nevertheless, the growing use of ammonia as a refrigerant is expected to act as an opportunity for the global market. The global ammonia market is currently dominated by the Asia Pacific region with major consumption in nations such as India and China. The region is further expected to lead the global ammonia market during the forecast period.

Ammonia Market: Overview

  • Ammonia is an essential source for many downstream nitrogen-based products. It acts as a nutritional supplement in foods and fertilizers. It also has various applications in cleansing products and the pharmaceutical industry. Ammonia is used for commercial as well as household applications. This makes it one of the highly produced inorganic chemicals in the world.
  • Ammonia is the basic building block of the global nitrogen industry. Consumption of ammonia for nitrogen fertilizers accounts for more than 80% of the global ammonia market.
  • Ammonia is processed into downstream fertilizer products before being applied to the soil. These products include urea, ammonium nitrates, ammonium sulfate, ammonium phosphates, and nitrogen solutions.
  • According to Transparency Market Research’s latest research report on the ammonia market for the forecast period of 2021 to 2031, rise in usage of ammonia in agriculture is a key factor that is expected to boost the global ammonia market during the forecast period
  • In terms of revenue, the global ammonia market is estimated to reach US$ 34 Bn by 2031, expanding at a CAGR of ~2% during the forecast period

Rise in Demand for Fertilizers in Agriculture Industry: Key Driver of Ammonia Market

  • Ammonia occurs naturally, and is found throughout the environment in soil, air, and water. It is also renewed naturally as part of the nitrogen cycle that already occurs as plants fertilize. As a result of this natural process, ammonia does not last long in the environment. It also does not bio-accumulate.
  • Ammonia, a colorless gas with distinct odor, is a building-block chemical and a key component in the manufacture of many products that people use every day. It occurs naturally throughout the environment in the air, soil, and water and in plants, animals, and humans. The human body makes ammonia when it breaks down foods containing protein into amino acids and ammonia, then converting the ammonia into urea.
  • Approximately 90% of the ammonia produced worldwide is used in fertilizers to help sustain food production for billions of people around the world. Production of food crops naturally depletes soil nutrient supplies. In order to maintain healthy crops, farmers rely on fertilizers to keep their soils productive.
  • Ammonia is used to make nitric acid with which, it is then mixed to produce nitrate fertilizers such as ammonium nitrate (AN). Ammonia may also be mixed with liquid carbon dioxide to create urea. Both these products can be further mixed together with water to form urea ammonium nitrate.
  • Household ammonia cleaning solutions are manufactured by adding ammonia gas to water with concentration between 5% ammonia and 10% ammonia. Ammonia solutions for industrial usage may be in the concentration of 25% or higher. These solutions are corrosive.
  • Ammonia can be used to purify water supplies. It can also be employed as a building block in the manufacture of many products (including plastics). It is also used a stabilizer, neutralizer, and source of nitrogen in waste and wastewater treatment, cold storage, rubber, pulp & paper, and food & beverage industries.

Liquid Form Dominates Ammonia Market

  • Based on form, the liquid segment dominated the global ammonia market in 2020. This can be primarily ascribed to the increase in demand for production of fertilizers and pharmaceuticals.
  • The gas form of ammonia is employed in limited applications. The gas segment is likely to expand at a steady pace during the forecast period.
  • The liquid segment is anticipated to experience significant growth during the forecast period, as it is used in various applications, including industries such as textile, pulp & paper, and mining

Rise in Application of Ammonia in Agriculture Industry

  • In terms of value, the agriculture end use segment is estimated to dominate the global ammonia market during the forecast period. The segment is projected to maintain its dominance during the forecast period.
  • Agriculture is likely to be a highly attractive end use segment of the global ammonia market during the forecast period. Increase in demand for fertilizers is anticipated to drive the segment in the near future.
  • The pharmaceutical segment offers lucrative growth opportunities to the global ammonia market

Ammonia Market: Competition Landscape

  • Detailed profiles of providers of ammonia have been included in the report to evaluate their financials, key product offerings, recent developments, and strategies
  • Key players operating in the global ammonia market are
    • BASF SE
    • Yara International
    • Ostchem Holding
    • Sumitomo Chemical
    • Honeywell International
    • ACRON
    • Togliattiazot
    • Helm AG
    • Ube Industries
    • China Petroleum & Chemical Corporation

Ammonia Market: Major Players

  • Major providers of ammonia, such as BASF SE, Yara International, Sumitomo Chemical, and China Petroleum & Chemical Corporation, are focusing on research & development, merger, joint venture, collaboration, and product innovation strategies
  • In the global ammonia market report, we have discussed individual strategies, followed by company profiles of providers of ammonias. The ‘Competition Landscape’ section has been included in the report to provide readers with a dashboard view and company market share analysis of key players operating in the global ammonia market.

Ammonia Market – Scope of the Report

The latest study collated and published by Transparency Market Research (TMR) analyzes the historical and present-day scenario of the global ammonia market in order to accurately gauge its future growth. The study presents detailed information about the important growth factors, restraints, and trends that are creating a landscape for the growth of the global ammonia market so as to identify growth opportunities for market stakeholders. The report also provides insightful information about how the global ammonia market would expand during the forecast period of 2021 to 2031.

The report offers intricate dynamics about different aspects of the global ammonia market, which aids companies operating in the market in making strategic development decisions. TMR’s study also elaborates on significant changes that are highly anticipated to configure growth of the global ammonia market during the forecast period. It also includes a key indicator assessment that highlights growth prospects of the global ammonia market and estimates statistics related to growth of the market in terms of volume (kilo tons) and value (US$ Mn).

This study covers a detailed segmentation of the global ammonia market, along with key information and a competition outlook. The report mentions company profiles of players that are currently dominating the global ammonia market, wherein various development, expansion, and winning strategies practiced and implemented by leading players have been presented in detail.

Key Questions Answered in TMR’s Report on Ammonia Market

The report provides detailed information about the global ammonia market on the basis of a comprehensive research on various factors that are playing a key role in accelerating the growth potential of the global market. Information mentioned in the report answers path-breaking questions for companies that are currently operating in the market and are looking for innovative methods to create a unique benchmark in the global ammonia market, so as to help them design successful strategies and make target-driven decisions.

  • Which end use segment of the global ammonia market would emerge as major revenue generator during the forecast period?
  • How are key market players successfully earning revenue out of advantages of ammonia?
  • What would be the Y-o-Y growth trend of the global ammonia market between 2021 and 2031?
  • What are the winning imperatives of leading players operating in the global ammonia market?
  • Which form segment is expected to create lucrative opportunities for the global ammonia market during the forecast period?
  • Which are the leading companies operating in the global ammonia market?

Research Methodology – Ammonia Market

The research methodology adopted by analysts for compiling the global ammonia market report is based on detailed primary as well as secondary research. With the help of in-depth insights of the market-affiliated information that is obtained and legitimated by market-admissible resources, analysts have offered riveting observations and authentic forecasts for the global ammonia market.

During the primary research phase, analysts interviewed market stakeholders, investors, brand managers, vice presidents, and sales and marketing managers. Based on data obtained through interviews of genuine sources, analysts have emphasized the changing scenario of the global ammonia market.

For secondary research, analysts scrutinized numerous annual report publications, white papers, market association publications, and company websites to obtain the necessary understanding of the global ammonia market.

Ammonia Market – Segmentation

TMR’s research study assesses the global ammonia market in terms of form, end use, and region. This report presents extensive market dynamics and trends associated with different segments of the market and how they are influencing growth prospects of the global ammonia market.

Form
  • Gas
  • Liquid
  • Powder
End Use
  • Pharmaceutical
  • Agriculture
  • Pulp & Paper
  • Textile
  • Mining
  • Others (including Food & Beverages and Petroleum)
Region
  • North America
  • Latin America
  • Europe
  • Asia Pacific
  • Middle East & Africa

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Ammonia Market

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