Ammonia prices in the United States increased by 6.8% in early February 2026, following a significant decline during January. The recent rebound reflects short-covering and tactical buying rather than a strong recovery in demand, as supply additions and comfortable inventories continue to weigh on overall market sentiment.
Ammonia market entered January under pressure as rapid supply additions along the Gulf Coast increased spot availability. Fresh domestic tonnage reduced urgency among buyers, while downstream sectors remained largely inactive during the year-end holiday period. As a result, ammonia values corrected sharply at the beginning of the month.
By mid-to-late January, trading activity became range-bound with limited liquidity. Market participants largely adopted a wait-and-watch approach, leading to muted spot negotiations. The January downturn in the ammonia market was mainly driven by ample supply conditions rather than a collapse in production economics.
Agriculture and fertilizer-related demand continued to be the primary driver of the ammonia market. However, ammonia buying interest from the farm sector remained weak during the festive window, with many distributors focusing on destocking rather than replenishment. Some intermittent front-loading by farm buyers offered limited support but was not enough to reverse the broader bearish tone.
On the raw material side, upstream natural gas prices declined significantly during the January, led to the lower production cost and reduced the Ammonia prices during the January 2026.
Short-term supply disruptions were reported during January but had limited impact on the overall balance. U.S. Nitrogen LLC in Tennessee declared a four-day force majeure following a storm-related power outage, while Shoreline Chemical in Georgia recorded a three-day disruption. These brief outages were insufficient to offset the broader ammonia supply surplus.
In early February 2026, weekly dynamics shifted as buyers returned to the market to cover positions after January’s steep correction. The 6.8% week-on-week increase reflects tightening spot spreads and tactical purchases rather than a structural improvement in demand. The rebound in ammonia market is widely viewed as a technical adjustment following earlier declines.
Despite the recent increase, market fundamentals remain mixed. Export outlets continue to face constraints, limiting offshore shipment opportunities. At the same time, expanding domestic capacity keeps ammonia supply readily available, preventing sustained upward momentum.
Looking ahead, analysts expect potential softening in the near term as capacity growth and comfortable inventories continue to weigh on the market. Seasonal agricultural demand may provide periodic support, but volatility is likely to persist. According to ChemAnalyst, short-term rallies may occur; however, sustained gains will depend on stronger downstream buying and improved export activity.
