AUSTRALIA AMMONIA MARKET ANALYSIS

Ammonia is one of the most abundant nitrogen-containing compounds with formula NH₃. It is a colourless gas with a distinct pungent odour and occurs naturally in the environment in the air, plant, soil, and animals including humans. In humans, the synthesis of ammonia takes place when the body breaks down food especially protein into amino acid and then converting the ammonia into urea. Household ammonia is commonly called ammonium hydroxide, it is an ingredient that is mainly used in various cleaning products for breaking down stains such as cooking grease and other stains.

Australia ammonia market was valued at US$ 934.85 Million in 2021 and 1,905 Kilo Tons in terms of volume and is expected to exhibit a CAGR of 6.4% during the forecast period (2022 to 2030).

Market Drivers

Rising consumption of ammonia-based fertilizer in agriculture in the Australian continent to enhance the yield productivity to meet the growing demand for food. In 2020-21, according to the Australian Bureau of Statistics Agricultural businesses, 387 million hectares of agricultural land was fertilized with mainly ammonia-based fertilizer. Both Western Australia and New South Wales used huge volumes of ammonia-based fertilizer during 2020-21.

Rising demand for household cleaning products as ammonia has excellent cleanser property and mainly used to produce household cleaning products such as window cleaners, bathroom cleaners, drain cleaners, toilet cleaners, oven cleaners, etc. Increasing disposable income of the people and improving the living of standards is another major factor expected to propel the market growth of the ammonia over the forecast period.

Among region, Western Australia region dominated the Australia ammonia market in 2021, followed by New South Wales and Queensland, respectively.

Figure 1. Australia Ammonia Market Value Share (%), By Region, 2021

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Market Restraints

High dependency of  Australia agriculture industry on imports of fertilizer products from China and other countries is projected to impact the sales of ammonia for the production of fertilizers in the region. Moreover, variation in seasonal demand for fertilizers is also projected to lower the demand for ammonia, especially in Queensland and Victoria. Hence, the aforementioned factors are presumed to hinder the market growth of Australia ammonia over the forecast period.

Ammonia as a refrigerant has a major disadvantage due to its toxicity because of its hygroscopic nature, it spread to most areas of the body such as eyes, throat, and nose and may lead to severe burn injuries. Moreover, ammonia as a refrigerant may cause various skin and respiratory disorders on exposure. Hence, health issues associated with the exposure of ammonia as refrigerant is expected to hinder the Australia market growth over the forecast period.

Market Opportunities

The rising focus of the manufacturer of  Australia ammonia market to produce green ammonia in order to promote sustainability is expected to fuel market growth. For instance, in September 2019, on behalf of the Australian Government, the Australian Renewable Energy Agency (ARENA) provided US$ 1.90 million to fund to Queensland Nitrates Pty Ltd. (QNP), an Australian manufacturer of nitrogenous fertilizers, to assess the feasibility of the construction and operation of a renewable ammonia plant at its existing facility near Moura in Central Queensland.

Market Trends

Rising investment by the major manufacturer in Australia is expected to foster market growth over the forecast period. For instance, in October 2019, the Australian government allocated US$ 1.93 million in financing for two studies seeking to explore the potential of using green hydrogen from wind and solar power electrolysis in the production of ammonia. Therefore, rising support of the Australian government in order to expand the application of ammonia is expected to fuel the market growth.

Figure 2. Australia Ammonia Market Value Share (%), By Application, 2021

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On the basis of application, Australia ammonia market is segmented into agrochemicals, industrial chemicals, explosives, and others. In 2021, industrial chemicals dominated the market in terms of revenue share, followed by agrochemicals and explosives.

Competitive Section

Major players operating in Australia Ammonia market include Incitec Pivot Limited, Yara International ASA, Orica Limited, and Wesfarmers Chemicals, Energy & Fertilisers.