|
Synthesized from ammonia and carbon dioxide (CO2), urea is the only primary
nitrogen product chemically classified as organic (because of its carbon content).
Because urea is produced from ammonia and carbon dioxide, which is a by-product
of ammonia production, all urea plants are located adjacent to or in proximity
to an ammonia plant. Most world output is in solid form (prills or granular,
or crystalline for specialized small-volume uses). In a number of industrialized
countries, a growing volume of liquid product is consumed in the production
of nitrogen solution fertilizers, and in liquid cattle feeds. While fertilizer
use dominates consumption of urea, important secondary markets are in use as
a source of nonprotein nitrogen in cattle feeds, as a basic building block
for urea-formaldehyde resin systems, and as a raw material for melamine and
cyanurate synthesis.
The most significant aspect of the historical world supply/demand balance
is the relatively steady growth in production (equal to apparent consumption),
with only a minor pause in 2000 and 2001 when the Southeast Asian economy suffered
a significant temporary slowdown.
Assuming reasonable weather, and no significant negative economic/political
events, the market will probably begin to weaken in late 2007, as a downward
cycle begins. Although urea prices have been high during the past two to three
years, profit margins have not been satisfactory for producers in countries
that have been hampered by high natural gas prices.
Although urea is consumed primarily as a fertilizer material, a significant
industrial market for urea also exists in the industrialized countries. Industrial
uses are estimated to account for around 10% of the world urea market. Because
of its high nitrogen content (46%), urea is the most popular form of solid
nitrogen fertilizer, particularly in the developing regions of the world, and
is traded widely in the international market. Urea fertilizer consumption increased
at an average annual rate of 3.5% between 1994 and 2006 while nitrogen fertilizer,
in total, increased at a rate of only 1.9% per year. Thus, urea gained considerable
market share at the expense of other nitrogen fertilizer materials.
The following pie chart shows world consumption of urea:
Apparent consumption is defined as production plus imports minus exports.
World apparent consumption of urea increased by 61% between 1994 and 2006 and
is forecast to increase by an additional 12% between 2006 and 2011 (an average
annual growth rate of 2.3%). Most regions will post gains. The Asian regions
stretching from the Middle East to Southeast Asia and including Japan accounted
for 72% of world urea consumption in 2006. |
