The Market Overview of Ammonium Nitrate and its Growing Demand

This blog contains in-depth information on ammonium nitrate definition, its industrial uses as well as production processes, key players, and pricing trends.

Ammonium nitrate: Definition

Ammonium nitrate (NH4NO3) is a colourless crystalline solid that is commercially accessible. The ammonium salt of nitric acid.

It has a melting point of 170°C and is white. It does not burn quickly, but with the help of an explosive agent, it can. It has a density of 1.725 g/cm3. It has a pH of roughly 7 and is a neutral material. It is hygroscopic, which means it can absorb moisture from the air, causing clumping or caking.

It has no distinguishing odour. At 20°C, it is extremely soluble in water, having a solubility of 118 g/100 mL. It's also barely soluble in ethanol.

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When burned, it produces hazardous nitrogen oxides. Furthermore, it is used mostly in fertilisers, and explosives, as an oxidising agent, as a nutrient for yeast production, and as an antibiotic.

Ammonium Nitrate Industrial Uses

Ammonium nitrate is mostly used as a fertiliser in the agricultural sector.

It is also utilised in the production of explosives, making it suitable for usage in end-user sectors such as mining, construction, defence, and quarrying.

Ammonium nitrate solids can be formed into grains, crystals, or granules.

Hot ammonium nitrate spirits are widely used in the mining industry. In addition, electronics-grade ammonium nitrate is used in the industry.

It is used in the gas-phase chemical deposition stage to create LCDs, semiconductors, and thin-film oxides for items such as cell phones, automobiles, computers, robotics, space rockets, and medical equipment.

In the oil and gas sector, ammonium nitrate production is utilised in fracturing operations, which is a method used to boost the productivity of oil and gas wells. The increased need for oil and gas is likely to enhance ammonium nitrate demand in this industry.

Ammonium Nitrate Production Cost Study

• Production of Ammonium Nitrate from Metal Nitrates: A conventional metathesis procedure is used to produce ammonium nitrate. Ammonium salts are manufactured to react with metal nitrates in the technique, resulting in the removal and creation of Ammonium Nitrate salt.
• Production of Ammonium Nitrate from Ammonia: Ammonium Nitrate is produced by reacting nitric acid with anhydrous ammonia, which results in the development of an aqueous ammonium nitrate solution. Following the production of the solution, the excess water is evaporated, and the ammonium nitrate is converted into tiny beads for industrial use.

Key Players

• CF Fertilisers UK
• Croda International Plc
• Yara International ASA
• Orica Limited
• Maxamcorp Holding, S.L.
• Sasol Limited

Ammonium Nitrate: Price Trend and Forecast

North America

Recently, prices for ammonium nitrate in North America have been stable to strong, owing to abundant supply and weak purchase intent. The sharp drop in the prices of feedstock Ammonia and Crude Oil signalled an increase in cost pressure in the regional market's fundamentals.

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Despite the American market's low consumption rates, production costs remained ideal. In the United States, supply chains have remained a source of concern for businesses in recent quarters. Logistical constraints and port closures on the East Coast and in the Gulf of Mexico have exacerbated supply dynamics.

The disruption in downstream agricultural demand caused by Hurricane Ian has resulted in a drop in demand fundamentals. It has altered the area market's trade attitudes.

Asia Pacific

In recent times, the Asia Pacific region's Ammonium Nitrate price trend fell. The primary cause of the low price was primarily bearish demand.

The price of the feedstock material, liquid Ammonia, has recently fluctuated in the market, although the price of Nitric Acid has remained low.

Ammonium Nitrate demand has been harmed by low raw material costs, while downstream demand from the explosives sector has ceased. The market remained slow, particularly in the APAC region.

The domestic market has abundant supplies since operational expenses are lower in the regional market due to higher energy expenditures.

Europe

Ammonium Nitrate prices in Europe skyrocketed due to limited supplies and unclear geopolitical climatic conditions recently.

While industrial operating expenses were average, the supply situation remained extremely tight. Because the bulk of materials were supplied to Asian nations, there was limited availability of the material in the regional market.

Demand from the downstream mining and explosives industries was reasonable due to their moderate performance in the regional market. Supply constraints and inflationary fears aided the spike in Ammonium Nitrate prices, which reached record or multi-year highs.

The rise in Ammonium Nitrate prices was fueled by a shortage of Russian petrol supplies as well as advanced European demand.

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