Unnatural fertilizers are generally divided into three main types:
1- Nitrogen fertilizers: They contain a high percentage of nitrogen and are produced mainly from natural gas and include many substances, the most important of which are “ammonia” and “urea.”
2- Phosphate fertilizers: They are produced using phosphate, and its most important product is “DAP” or diammonium phosphate, which is the substance that “Ma’aden” will begin producing, as SABIC currently produces through one of its subsidiaries, “Ibn Al-Bitar”...
3- Potassium fertilizers: They depend on potassium, and their production is concentrated in areas rich in potassium (Jordan, for example).
We will limit the discussion here to nitrogen fertilizers, especially ammonia and urea, which are produced by converting natural gas into ammonia in the first stage, and then the ammonia is used as a feedstock to produce urea. Usually, urea factories are integrated, meaning they produce ammonia and urea, and it is rare for ammonia to be purchased from The market is for the purpose of producing urea. Integrated companies use a large portion of ammonia production as feedstock for urea production, while selling the surplus in the market for use in other industries.
Main export areas: Given that the production of ammonia and urea is the simplest type of conversion to natural gas, the two materials are produced in dozens of countries around the world (the two materials are produced in at least 80 countries), but most countries consume their production locally and the export areas are largely concentrated in three main regions:
1- The Arabian Gulf and the Middle East: There are two large companies in the Middle East, the Qatari “QAFCO” and the Saudi “SAFCO”, as well as many smaller companies in Kuwait, Bahrain, Oman, Abu Dhabi, Egypt, Libya, Algeria and Iran, and this region is considered one of the main export regions in the world. Because the volume of production greatly exceeds local consumption, this region is characterized by low costs due to the low price of natural gas .
2- The Black Sea region: Ukraine and Russia are major producers of the substance and major exporters at the same time (40% of the global ammonia and urea trade)... During the past decade, Russia has continuously raised the prices of gas exported to Ukraine, which has led to higher costs, as it has lost Ukraine's position as a low cost center for the material...
3- The Caribbean and Central America: It is characterized by its low costs, such as the Arabian Gulf (Trinidad, Mexico, and Venezuela), and it exports its products to the United States of America and South America.
Of course, there are other countries that export, such as Canada, Indonesia, Australia, and China, but they are considered regional and not global (for example, most Canadian exports are directed to the American market).
International prices are determined mainly through the two main export centers (the Black Sea) and (the Arabian Gulf). Usually, exports are made from the Black Sea to Europe and South America, while Gulf exports include Asia, North America, and Africa.
During the past twenty years, the fertilizer industry has witnessed historical transformations, the most important of which is the transformation of China from the largest importer of the material at the end of the eighties to a country that achieved self-sufficiency by 1997 and then an exporter at a later time, which then led to pressure on global prices for a long period (1997 - 2003). ... Production in the United States of America has also decreased continuously during the last 15 years for various reasons, making it one of the largest importers in addition to India...
For a long time, the cost of production in Ukraine was what determined the bottom of prices that could be reached ($100-$130 per ton). However, Russia’s continuous raising of gas prices made costs rise there, as the costs of producers in Ukraine are currently estimated at between $200 and $240 per ton. This means that it is difficult for prices to fall below this number because if that happens, Ukrainian production will stop, and it can be noted that global prices for urea have not fallen below the $250 level over the past five years except for short periods.
The Middle East is expected to surpass the Black Sea in terms of importance as an export center, as production is expected to rise to 25 million tons, most of which is designated for export.