Urea Prices Have Fallen Globally as Natural Gas Prices Have Eased
- 27-Jan-2022 5:00 PM
- Journalist: Yage Kwon
Due to diminishing supplies, Urea prices have been unpredictable in recent months, but as we reached 2022, some price relaxations were seen on the back of eased prices of Natural Gas. Last week, Urea prices decreased by USD10 per tonne, while Ammonia prices fell by USD20 per tonne in Saudi Arabia. Fertilizer prices plummeted across the world as the price of nitrogen fell.
In last few months, fertiliser prices have soared to new highs on the global market, owing to setbacks such as an energy crisis in Europe, unexpected plant closures, and delayed exports from important suppliers and countries. Because of the increase, there were concerns about future food inflation. Farmers may opt for less expensive crop nutrients this year because Urea is very inexpensive in the United States, which is a major importer of all key crop nutrients, reducing the pressure on food spending that has driven up consumer prices. In January, European gas prices plummeted from a high of USD 202 per MWH to as low as USD 98 per MWH, a crucial driver of fertiliser prices for farmers.
As per ChemAnalyst “winter weather also aided in the cooling of the sweltering gas market. Although European gas costs are still three times higher than this time last year, the 52 percent decline in gas prices has fuelled certainty that fertiliser prices may fall as well. To alleviate the market, Urea supply would be raised by 30%, or around 3,000-5,000 tonnes across the world. Many facilities will be fully operating in January and February of this year. In addition, nitrogen fertiliser appears to have reached its high and is beginning to drop in early 2022.