Global Ammonium Chloride Price Pickups Momentum After Demand Revival Amidst Curtailed Supplies
Global Ammonium Chloride Price Pickups Momentum After Demand Revival Amidst Curtailed Supplies

Global Ammonium Chloride Price Pickups Momentum After Demand Revival Amidst Curtailed Supplies

  • 11-Sep-2023 3:45 PM
  • Journalist: Shiba Teramoto

In August 2023, the global fertilizer market, including Ammonium Chloride, witnessed a substantial price surge on a worldwide scale. This noteworthy price increase can be attributed to a combination of factors that affected the industry. These factors include disruptions in the supply chain, a resurgence in demand from the international market, and a rise in freight charges. Furthermore, there was an uptick in the cost of the essential feedstock, Ammonia, in Europe, which contributed significantly to the overall price escalation for Ammonium Chloride. However, its worth noting that during the same period Anhydrous Ammonia prices remained stagnant in North American market.

In Europe, the price of Ammonium Chloride and its critical feedstock, Ammonia, experienced a notable increase in prices. This surge in pricing can be credited with the improved performance of fertilizers (including Ammonium Chloride) in the international market. At the onset of August 2023, Russian fertilizer producers actively entered the U.S. market for Nitrogenous fertilizers, driven by the pull of higher local prices and actively stocking up of fertilizers for forthcoming planting season. However, as the month drew to a close, Russian producers expanded their sales activities, becoming actively involved in the U.K. and France markets, with plans to sustain this growth in the upcoming months.

Moreover, certain disruptive events had a considerable impact on the fertilizer landscape. A fire in a fertilizer warehouse in Moscow, coupled with subsequent damage to 60,000 tons of fertilizer at the Odesa port at the end of July, significantly disrupted the supply chain for fertilizers, including Ammonium Chloride, within the European market. These unforeseen events contributed significantly to the price surge observed in the fertilizer market across Europe.

Similarly, in the United States, the price of Ammonium Chloride followed an upward trajectory. This price increase was primarily driven by the high costs associated with imports from overseas markets and shifts in demand dynamics within the domestic market. Notably, the state of Minnesota faced severe drought conditions during this period, leading to a noticeable decline in procurement orders for Ammonium Chloride. In contrast, demand for fertilizers, including Ammonium Chloride, in the southern region, particularly South Dakota, experienced a moderate increase due to more favourable rainfall conditions. This climatic event contributed to a modest rise in Ammonium Chloride demand.

Furthermore, the Panama Canal experienced low water levels, caused by elevated temperatures, which led to delayed imports. Consequently, this delay resulted in a scarcity of various fertilizers, including Ammonium Chloride, in the regional market.

According to ChemAnalyst, it is anticipated that Ammonium Chloride prices will witness an uptick in the upcoming months in both the North American and European regions. This expected price increase can be attributed to the recovery of demand from end-user markets and a notable upswing in the prices of the essential feedstock, Anhydrous Ammonia, as well as upstream natural gas prices.

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