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Ammonia is the basic building block of the world nitrogen industry and the starting material for six primary nitrogen products - urea, ammonium nitrate, ammonium phosphates, ammonium sulfate, nitric acid and nitrogen solutions. Worldwide (and excluding some significant storage, processing and distribution losses), 85-90% of ammonia is ultimately consumed as nitrogen fertilizer. A wide variety of industrial uses for ammonia and its derivative products account for the remaining 10-15% market share.
Since the nitrogen fertilizer market is relatively mature in most industrialized economies, developing nations have accounted for much of the growth in capacity, production and demand in recent years. World ammonia capacity increased by 14% during 1984-1996. Capacity for urea, the primary downstream nitrogen product, grew by 45% during the same period. Capacity for ammonium phosphate also rose, by 9%. Capacity for ammonium nitrate was fairly stable during the period, dropping by 2%, while ammonium sulfate capacity declined by 8%. Changes in production for each major nitrogen product have generally paralleled the changes in capacity.
Apparent world consumption of ammonia (which, by definition, is equal to production) increased by 16% between 1984 and 1996, with the consumption of urea and ammonium phosphates increasing by 54% and 5%, respectively. Developing countries were largely responsible for the increased consumption while severe declines occurred in the former USSR and Eastern Europe. World consumption of ammonium nitrate and ammonium sulfate both declined marginally between 1984 and 1996.
Trade is an important component of the world nitrogen industry. World trade in each of the major nitrogen products analyzed in this report increased during 1984-1996. Ammonia and urea are the primary nitrogen products traded, with urea being particularly important, since over 25% of world production is ultimately traded. About 10% of ammonia production is traded internationally. Ammonium phosphates are also widely traded, with about 45% of world production being traded internationally in 1996. In this case, however, the nitrogen value is of secondary importance since the phosphorus content is the primary nutrient value. Trade in ammonium nitrate and ammonium sulfate is also significant (18% and 39% of world production, respectively, in 1996), but involves much less nitrogen volume than the other products. Trade will continue to be an important part of the world nitrogen industry.
Between 1996 and 2002, world ammonia capacity is projected to increase by about 17% (20 million metric tons N). World urea capacity is expected to increase by about 23% (12 million metric tons N). World ammonium nitrate capacity is forecast to increase by about 7% (1.5 million metric tons N). World ammonium phosphate capacity is also expected to increase by 8% (one million metric tons N). Ammonium sulfate capacity is expected to increase only marginally through 2002.
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