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Nitrogen+Syngas 396 Jul-Aug 2025

15 July 2025

Market Outlook

Market Outlook

AMMONIA

• The short term outlook appears balanced for the most part, although more bullish participants seem to be holding sway over market sentiment.

• Imminent tariffs on imports of Russian fertilizers into the EU may trigger an uptick in downstream capacity utilisation across the continent.

• US gas storage has been higher than expected from slightly warmer weather – this has led to a slight reduction in prices over the summer.

• European premiums for lower carbon ammonia are likely to emerge from the start of 2026 due to the creeping implementation of the Carbon Border Adjustment Mechanism.

UREA

• The short term outlook for urea is firm, though there is the potential for disruption from a low tender for India.

• North African prices may correct as European interest fades.

• The ongoing strikes by Israel on Iran may herald a broader and more serious conflict in the Middle East with the potential to severely disrupt vital energy and fertilizer trade.

• The US introducing tariffs and then flip flopping on its implementation raise market uncertainty and curbed fertilizer imports.

• Clarity on Chinese urea exports emerged in early May via a ‘quota allocation’ system for urea exports, with a total of 2 million tonnes of exports allowed between May-Sept 2025. While exports to India remain banned, they are likely to find home in South Korea, Sri Lanka, Philippines, and Mexico, and many in the industry expect the market to ‘find a way’ to access India, with prices likely to fall until restrictions are reimposed in October.

• f.o.b. values of $370-375/t are proving competitive in west coast Latin America.

METHANOL

• China continues to dictate the overall global methanol market. Chinese thermal coal prices have fallen by 10% since January and supply remains healthy for now, with a weaker demand outlook.

• Crude oil prices have risen on market uncertainty and low inventories but additional OPEC+ production will limit the upside to prices.

• Chinese MTO demand sets the methanol price cap, with overcapacity in Chinese olefin markets contributing to headwinds in that direction, although it remains to be seen whether the current conflict between Israel and Iran will affect Iranian methanol shipments to China; Iran represents more than half of Chinese methanol imports.

• Shortages of new supply projects outside of China will likely lead to higher prices to drive reinvestment in the longer term.

Latest in Agricultural

Feedstock allocation for fourth phosphate plant

The Saudi Arabian Mining Company (Ma’aden) says that the Ministry of Energy has approved the allocation of feedstock for its fourth phosphate project. This project aims to produce approximately 1.1 million t/a of ammonia and increase the production of phosphate and specialty fertilizers by about 2.5 million t/a, raising the company’s total production capacity to nearly 12 million t/a. This will further solidify Ma’aden’s position as one of the world’s largest producers of phosphate fertilizers, according to a company statement. Ma’aden will now commence engineering studies and obtain the necessary approvals.

Phosphate investment deal

Syria’s Geological and Mineral Resources Authority has signed an agreement with Teryaq, a subsidiary of Serbia’s Exlixir Group, aimed at exporting 1.5 million t/a of phosphate by the end of 2026. The agreement marks a significant step in Syria’s efforts to expand international partnerships and optimise its mineral resources for economic gain. Elixir Group owns the largest phosphoric acid plant in Europe and operates three fertilizer plants in Serbia.

Chatham Rock Phosphate sells Australian subsidiary

Chatham Rock Phosphate has agreed to sell its wholly-owned Australian subsidiary Avenir Makatea Pty Ltd to Austure Industries Pty Ltd for A$1.4 million, including A$900,000 in cash over a 24-month period, and a 20% shareholding in Austure Phosphate AU Pty Ltd, a newly-formed subsidiary of Austure, to establish a mono- and dicalcium phosphate manufacturing plant in Cloncurry. Colin Randall, Chatham Executive Director has been appointed a Director of Austure Phosphate AU Pty Ltd.

Safi floods likely to impact phosphate supply from OCP

Flash floods in the Moroccan port city of Safi killed at least 37 people in December and injured many others, with knock on effects also likely to impact exports from phosphate producer OCP. Jorf Lasfar is the phosphate giant's main export hub for phosphate fertilizers and phosphoric acid, while Safi exports smaller volumes of phosphoric acid, TSP and animal feed products. Phosphate rock exports are largely concentrated at the port of Casablanca further north. OCP produces around 420,000 t/a triple superphosphate and 1.63 t/a phosphoric acid at Safi, as well as around 62,000 t/a dicalcium phosphate and 70,000 t/a monocalcium phosphate.