Ammonium Nitrate Market - Forecast(2023 - 2028)

Ammonium Nitrate Market Overview

Ammonium Nitrate Market is forecast to reach US$19.2 billion by 2026, after growing at a CAGR of 4.3% during 2021-2026. Countries in the Asia Pacific region are mostly dependent on agriculture, and this factor is likely to drive demand for ammonium nitrate in the region's fertilizer sector. The high energy on the surface of ammonium nitrate increases the propensity of the molecules to absorb moisture from the surrounding environment, making it particularly hygroscopic. Anhydrous ammonia is used in a range of applications, including agriculture. Anhydrous ammonia, unlike ammonium nitrate, is a gas that is more commonly seen as a concern due to its inhalation toxicity. The growing population is generating a high demand for food, particularly in India and China, followed by a focus on modern farming activities such as hydroponic and rotary crops and agroforestry. In addition, high investment by mining companies in exploring new exploration sites for valuable metals and minerals is also expected to drive the growth of the mining applications industry. This is a major factor expected during the forecast period that drives the demand for ammonium nitrate.

COVID-19 Impact:

The repercussions of the Covid-19 pandemic, which is sweeping the globe, are currently wreaking havoc on global markets. The fertilizer industry has been impacted since the beginning, particularly in China, which is the world's largest producer and user of phosphates, sulphur, and sulphuric acid, while in the future, Brazil and India may make headlines. Price reactions have been uneven, with tighter phosphate supplies due to production limits in China triggering a reversal in the downward trend, while the price of sulphuric acid, which was already low, has nearly plummeted. The impact on the fertilizer industry has drastically impacted the ammonium nitrate as it is one of the primary material in fertilizer.

Ammonium Nitrate Market Report Coverage

The report: “Ammonium Nitrate Market- Forecast (2021-2026)”, by IndustryARC, covers an in-depth analysis of the following segments of the Ammonium Nitrate industry.

By Application: Fertilizer, Explosives, Mining and Quarrying, and Others.
By End Use Industry: Aerospace and Defense, Agriculture, Oil and Gas, Building and Construction, and Others.
By Geography: North America (U.S, Canada, and Mexico), South America (Brazil, Argentina, Colombia, Chile, and Rest of South America), Europe (U.K., Germany, France, Italy, Netherland, Spain, Russia, Belgium, and Rest of Europe), APAC(China, Japan India, South Korea, Australia & New Zealand, and Rest of Asia Pacific), and RoW (Middle east and Africa).

Key Takeaways

• Asia-Pacific dominates the Ammonium Nitrate market owing to mature agriculture and construction sectors.
• Increasing production and demand for bauxite, manganese, diamonds, and base metals are projected to drive the growth of the ammonium nitrate market through blasting products.
• The market drivers and restraints have been assessed to understand their impact over the forecast period.
• The report further identifies the key opportunities for growth while also detailing the key challenges and possible threats.
• The other key areas of focus include the various applications and end use industry in PVC Additives market and their specific segmented revenue.

Figure: Ammonium Nitrate Market Revenue, 2020-2026 (US$ Billion)

Ammonium Nitrate Market Segment Analysis- By Application

Fertilizers held the largest share of 37% in the Ammonium Nitrate market in 2020. In recent years, the widespread use of various inorganic fertilizers across the agricultural landscape has increased the global population and increasing concerns regarding food safety. In agricultural fields and gardens, the use of ammonium nitrate increases plant growth by providing a full supply of nitrogen that enhances the quality of fruit and seeds, resulting in a better yield. In addition, reducing the total amount of arable land per person across the globe would increase the use of fertilizers on the market, which would dramatically increase the market share of ammonium nitrate. According to FAO (Food and Agriculture Organization) the world's intake of the three main fertilizer nutrients, nitrogen (N), phosphorus expressed as phosphate (P2 O5) and potassium expressed as potash (K2 O), have exceeded to 186.67 million tonnes (N, P2 O5 and K2 O) in 2016, an increase of 1.4% compared to 2015 levels of consumption. It has been estimated that demand for N, P2 O5 and K2 O is expected to rise on average annually by 1.5, 2.2, and 2.4 percent from 2015 to 2020, respectively. The global potential for the production of fertilizers, intermediates and raw materials is also expected to increase over the next five years. The increasing population around the world has forced farmers to increase crop yields, resulting in high fertilizer demand and thus boosting the growth of the industry.

Ammonium Nitrate Market Segment Analysis- By End Use Industry

Agriculture has been the primary market for Ammonium Nitrate in 2020 growing at a CAGR of 6.7% during the forecast period of 2021-2026. Over the outlook period, population growth is expected to remain the dominant driver of overall demand for agricultural commodities globally, in particular for commodities with high per capita consumption levels in regions with fast-growing populations. One of the most important tools for ending extreme poverty, boosting mutual prosperity and feeding a projected 9.7 billion people by 2050, is agricultural production. Development in the agriculture sector is two to four times more successful compared to other sectors in increasing incomes among the poorest. The growth in the agriculture sector and the rise in food insecurity is augmenting the demand for fertilizers. Thus rise in the consumption of fertilizers will increase the demand for ammonium nitrate as they are primary raw ingredients for fertilizers.

Ammonium Nitrate Market Segment Analysis- Geography

APAC dominated the Ammonium Nitrate market with a share of more than 45% in 2020, followed by North America and Europe. Development is due to the region's growing agricultural & construction activities. The main producers of a broad range of agricultural products in the region are China and India. China's agricultural production value in 2019 was around USD 1 trillion. India is also likely to see substantial growth in the agricultural sector in the area as a result of increased investment in agricultural infrastructure, such as irrigation, storage and storage facilities. Over the coming years, government policies to increase agricultural production will expand the use of fertilizers in the agricultural sector. Moreover, consumer spending in India has approached approximately $3.6 trillion in 2020 according to India Brand Equity Foundation (IBEF). It is has been estimated that food grain production has hit a record 291.95 million tonnes during 2019-2020. The government of India is targeting 298 million tonnes of food grain production in 2020-21. Apart from the agriculture industry, APAC construction sector is also witnessing growth due to rising investments in large infrastructure projects across the South East Asia region. The growth in the end use industries will support the growth of ammonium nitrate.

Ammonium Nitrate Market Drivers

Usage across various end use industries will augment the market growth

It is primarily used in fertilizers as a source of nitrogen and is the principal component of most non-military industrial explosives and blasting agents. There is a significantly higher density of fertilizer-grade Ammonium Nitrate than explosive-grade AN. The predominant type produced was solid Ammonium Nitrate (prills or granules), but liquid Ammonium Nitrate has gained popularity, particularly in developed economies, primarily as an element in Urea Ammonium Nitrate. A low-density type of prilled ammonium nitrate is commonly used in the mining industry and on building sites as an explosive. To allow rapid adsorption of fuel oil, manufacturers deliberately make it porous.

Ammonium Nitrate Market Challenges

High Regulatory Measures can restrict the market growth

Ammonium nitrate (NH4NO3) is a white, crystalline chemical which is soluble in water in its pure form. It is the key component used in mining and building to make industrial explosives. Under the United Nations classification of hazardous goods, it is graded as an oxidiser (Grade 5.1). It can be very explosive if combined with ingredients like gasoline or some other chemicals, or because of some other external factors. In countries such as Australia, Germany, Ireland, Pakistan and the United Kingdom, the selling of pure ammonium nitrate has been banned, while India has reclassified it as an explosive, which has tightened handling and storage regulations. Being hazardous in nature ammonium nitrate is regulated under strict regulation and limiting its growth.

Ammonium Nitrate Market Landscape

Technology launches, acquisitions and R&D activities are key strategies adopted by players in the Ammonium Nitrate market. Major players in the Ammonium Nitrate market are:

1. Orica Limited
2. Yara International
3. Enaex S.A.
4. Incitec Pivot Limited Inc.
5. CF Industries Holdings
6. EuroChem Group AG
7. URALCHEM JSC
8. Fertiberia SA
9. Vijay Gas Industry P Ltd.
10 OSTCHEM and Others.

Acquisitions/Technology Launches/ Product Launches

• In May 2020, Orica acquired 83.5% of share in Exsa S.A, a mining and Infrastructure company in Peru. The company is the manufacturer and distributor of industrial explosives. Exsa provides the mining (particularly gold and copper) industries with technical assistance and support. According to Orica, it has a larger share of both the underground and open-pit markets in Peru, with an effective supply chain, a robust sales distribution network and ammonium nitrate emulsion reserves strategically located in Northern, Central and Southern Peru.

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