Nitrogen Price Trend and Forecast

Regional Price Overview

Get the latest insights on price movement and trend analysis of Nitrogen in different regions across the world (Asia, Europe, North America, Latin America, and the Middle East & Africa).

Nitrogen Price Trend for the Q1 of 2024

Asia

In the first quarter of 2024, nitrogen prices followed the trend set by the urea industry in China. While production is exceeded, the downstream fertilizers exhibit slower growth, limiting the growth potential of the nitrogen market. This shift led to an oversupply scenario in the domestic nitrogen market, driving the prices downwards. On the trade front, nitrogen exports from China fluctuated throughout the quarter, supporting the nitrogen price trend. However, expanding global production and installation of new plants caused an excessive rise in inventories.

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Additionally, factors like stricter export policies and swindling dynamics of overseas trading further impacted the market momentum of nitrogen. Amid the end-user industries, agricultural usage remained the primary driver for nitrogen consumption in China, although only in the latter phase of the first quarter. Further, the application of nitrogen derivatives as a reducing agent in thermal power generation opened a new front for the industry.

Europe

During the first quarter of 2024, the European nitrogen market experienced a surge in prices driven by a combination of factors. In Europe, despite adverse weather conditions, nitrogen prices reached their highest levels as compared to the past two quarters. This increase was further fueled by a swift return of buyers preparing for spring agricultural work, heightened demand, and dwindling inventory levels amid a limited influx of overseas imports.

International tensions and ongoing attacks on sea route vessels in the Red Sea further contributed to the price surge by prompting the rerouting of shipments and increased shipping charges. The rising instances of the sinking of cargo ships further intensified the tension of supply disruptions, leading to delayed shipments and the destruction of fertilizer stocks. These events eventually widened the gap between demand and supply, causing volatility among the trader communities and a surge in the pricing patterns of nitrogen in Q1 of 2024.

North America

In North America, nitrogen prices surged in the first quarter due to optimistic market sentiments and increased demand from the downstream fertilizer sector. This trend reflected a modest resurgence in demand driven by the approaching spring planting season and favorable weather conditions.

However, a shortage of imported nitrogen was observed in many regions due to delays and reduced shipments caused by stagnant water levels in the Panama Canal and disruptions in essential trade routes. The persistent attacks on Red Sea shipments prompted the sea traders to opt for longer routes around the Cape of Good Hope. These challenges led to delayed and costlier shipments of nitrogen cargo to the US, worsening the shortage crisis.

Analyst Insight

According to Procurement Resource, the price trend of Nitrogen is estimated to move upwards in the next quarter as the rising downstream demand with the onset of spring agriculture season and low rates of production will favor the surge in nitrogen prices.

Nitrogen Price Trend for the October-December of 2023

Asia

As anticipated by the traders, the nitrogen market recorded volatility in its price trend due to a complex interplay of many factors. The uneven shutting down of manufacturing plants lowered the domestic production of nitrogen and increased the reliance of the market on overseas imports. The downstream fertilizer sector also showcased only moderate support, limiting the growth momentum of the nitrogen price trend. However, the other end-user industries, such as food, pharmaceuticals, healthcare, and electronics, displayed significant uprises, leading to the stabilization of nitrogen prices above the red mark.

In India, however, the overall market dynamics remained subdued due to a smaller number of inquiries from the international players and an excessive rise in the level of inventories. The traders, therefore, opted for destocking activities, lowering their pricing quotations of nitrogen during the last quarter of 2023.

Europe

Throughout Q4 of 2023, the pricing patterns of nitrogen in the European markets swindled under the pressure of rising inventories and dipping procurement rates of downstream industries. The market was further influenced by the lowering of trading volumes, particularly with the Asian countries, due to the loss of the Red Sea route and rising geopolitical tensions between Israel and Hamas.

Not only the downstream industries but the manufacturers of nitrogen also remained under the pressure of soaring costs of production due to the abrupt rise in transportation and raw material costs. However, towards the end of the quarter, the agrochemical industries presented an optimistic outlook of the market as the delayed agriculture season might benefit the traders and manufacturers in the next quarters.

North America

The global oscillations in the price trend of nitrogen during the fourth quarter of 2023 were well reflected in North America, too. Initially, the imbalance of supply and demand exerted a downward pressure on the overall sentiments of the nitrogen pricing momentum. However, increased demand from some selected industries, such as automobile and electronics, kept the market above water throughout the quarter. However, the functioning of fertilizer industries, which are the main drivers of the nitrogen price trend, presented a dim scenario of demand and thus kept the prices of nitrogen on the lower end of the spectrum.

Analyst Insight

According to Procurement Resource, the price trend of Nitrogen is expected to sustain an oscillating trend as the dwindling end-user demand and skeptical movement in cost patterns of raw materials in the current market scenario do not indicate towards improvement of conditions of the nitrogen market.

Nitrogen Price Trend for the July-September of 2023

Asia

The nitrogen prices in the Asian region exhibited steady market sentiments during the third quarter of the year 2023. The plateaued nature of the nitrogen price graph showed the healthy dynamics between supply and demand outlooks of the third quarter. Since the Chinese markets started opening up and reviving after the removal of COVID-19 restrictions, the pace of recovery has been under question.

Imitating that momentum, the nitrogen demands from the pharma and chemical industries also remained confined within a limited range. The inventories registered a slow but consistent stock movement. So, with a regular and equalized influx of supplies complimented by a similar demand outlook, the nitrogen price pattern turned out to be oscillating within a narrow range. Overall, stability was experienced in the nitrogen market during the said period.

Europe

Contrary to the stable market run of the Asian market, the European nitrogen market fell consistently throughout the given span. The upstream costs slid in the European region after the economic inflation backtracked a little. The demands from the downstream consumption industries remained dull throughout; this created a surplus volume for suppliers to manage, and thus, the suppliers were forced to cut down the prices in order to promote purchases. Overall, dipping trend were observed in the nitrogen market during the said period.

North America

The North American nitrogen market experienced a mixed market run compared to the other global markets. Since the prices followed downstream demands, the first half of the quarter saw some elevation, whereas the second half of the quarter witnessed a gradual decline. The general market outlook was fluctuating throughout the said time.

Analyst Insight

According to Procurement Resource, Nitrogen prices are likely to remain fluctuating going forward as well. The market demands are going to continue to drive the market sentiments.

Nitrogen Price Trend for First Half of 2023

Asia

In the first quarter of 2023, the prices of nitrogen oscillated owing to the declining cost of energy production, scarcity of nitrogen in the region, and several ups and downs in the downstream market. However, the market activities of the downstream industries improved in the second quarter, especially that of the tire and agricultural industries. The purchasing potential of buyers also inclined in this quarter, and the relaxed subsidy offered by the Indian government pushed the price trend of nitrogen to an inclined path.

Europe

In the first quarter of 2023, the price trend of nitrogen surged significantly in the European markets after some challenging initial months. The major cause of this incline was the rising demand for nitrogen from the food and packaging industries and the positive market momentum in European countries.

The rates of production also increase severalfold due to high rates of procurement. However, the second quarter witnessed the opposite movement of prices as the number of new orders declined significantly. The feedstock market was also affected by the high cost of energy production. In addition to this, the fertilizer industries struggled with several restrictions in this quarter, and the economic conditions also did not support the positive movement of the nitrogen price trend.

North America

The nitrogen prices in North America declined throughout the first and second quarters of 2023 due to the feeble movement of downstream industries. The low cost of energy production, high levels of inventories, and sliding activities of the nitrogen industries caused the price trend of nitrogen to fall throughout this time period.

Analyst Insight

According to Procurement Resource, the price trend of Nitrogen is expected to show a mixed trajectory. The demand from downstream industries and global economic conditions are estimated to dictate nitrogen prices.

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