Ammonia price

In the United States, two ammonia pipelines deliver ammonia to the Mississippi delta and to the Texas and Oklahoma panhandle region. Direct sales by basic producers are generally at wholesale prices. Basic producers also sell to distributors and jobbers for resale to end users buying smaller quantities. Distributors of ammonia to industrial end users have their own storage facilities, packaging plants and distribution networks. They are able to supply end users that buy in less-than-truckload quantities (a minimum of 1,000 to 2,000 pounds or 450 to 910 kilograms) or in cylinders or bottles57. 

Another important aspect of the ammonia business is seasonality. The major end use for anhydrous ammonia (excluding production of downstream nitrogen products) is as a direct application fertilizer. The application season, particularly in Canada and the northern United States, is limited and significant storage capability is needed. As a result, it is normal to expect a plant to produce a downstream nitrogen product (such as urea) that is 1) easier to store and handle and 2) does not have such a limited application season. Industrial markets are normally nonseasonal57. 

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Whereas the manufacturing cost is strongly influenced by energy prices, cost of money, and capital investment, ammonia selling prices are usually deterrnined by supply and demand. Therefore, the profitabiUty of ammonia plants is deterrnined by the margin between cost of production and ammonia price. 

Fig. 22. Ammonia and urea prices, 1968—1985.---, ammonia prices, F.O.B. (Western Europe) —urea prices, E.O.B. (Western Europe) bagged.

The economic estimation based on the pilot unit results showed that ammonia contributes 70% to the prime cost of the N20. Using this result and the ammonia price 0.37 kg-1 [191], one can evaluate the N20 price to be 0.53 kg-1. Certainly, this cost far exceeds that of dioxygen. Therefore, for reactions producing inexpensive products, like the oxidation of methane to methanol, the application of N20 cannot be economically sound. However, this modest cost opens great N20 prospects for the preparation of more expensive chemical products. For instance, the theoretical expenditure for N20 in the oxidation of benzene to phenol is 17%, and in the oxidation of phenol to hydroquinone is 4%, of the cost of the target product. The commercial viability of such processes will depend primarily on their technological advantages rather than the cost of nitrous oxide. 

The impact of natural gas prices on ammonia prices on the US Gulf Coast is shown in Figure 3.17. This figure also illustrates the high percentage of ammonia cash costs that are due to the natural gas feedstock price. 

Figure 8.1. Historical ammonia prices 1996 to 2003. (Reproduced by permission of Fertecon)...

As shown in Figure 8.2, international ammonia prices fluctuate on a shortterm basis. Over the longer term, they follow a cyclical pattern, moving up and down around a relatively stable base. 

The high mono-pressure process has been favored in the United States because of 1) its lower capital cost and 2) the traditionally lower energy and ammonia prices found in the United States. In Europe, where allowable capital payback periods and energy costs have traditionally been higher, the dualpressure process evolved104. 

AS prices vary by geographic region and depend on grade. The price is also affected by ammonia prices. In 2000 the list price was 105 per ton FOB, and between 1995 and 1998 the average price varied from US 63 to US 84 per... 

Ammonia Prices Hold Steady as Demand Remains Firm, Chemical Marketing Reporter (September 27, 2004). 

Ammonia is basically the main raw material needed to manufacture AN. Some of the AN manufacturers make their own ammonia and some purchase it on the open market. It is obvious that the cost of manufacturing AN will depend on the price of ammonia and, even more basically, natural gas from which it is made. The volatility of ammonia prices is shown by the fact that in 1992 it cost 95 per ton and in 1995 the cost was 207 per ton.38... 

Figure 123. Development of ammonia prices in North-West Europe... 

Obviously if a country possesses natural gas resources, which have already been exploited, the advanta of producing ammonia would increase and perhaps fertilizers could also be exported. The cyclic fluctuation of ammonia prices originates from voluntary investment decisions that create oversupply and low prices. Less efficient plants are closed, and a supply deficit occurs, which causes prices to rise. Higher prices stimulate new capacity, but up to 3 years is required to plan, build, and start up the new plants. 

About 5,000 kilotons of anhydrous ammonia were produced in Canada in 1997, of which 3,500 were utilized as fertilizer products and 2,000 applied directly to the soil as urea. About 14 kilotons were imported mostly from the United States (CIS, 1998). Ammonia prices and... 

Two Other features of ammonia lie behind the interest in using it as a hydrogen carrier. The first is that large stockpiles are usually available because of the seasonal nature of fertiliser use. The second is that ammonia prices are sometimes somewhat depressed because of an excess of supply over demand. However, when the details of the manufacture of ammonia, and its conversion back to hydrogen, are considered, it becomes much less attractive. 

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