Global blue ammonia prices edge lower, Europe falls 10% MOM

Platts global blue ammonia price assessments extended losses in April for a fourth consecutive month, with the monthly average of assessments in Northwest Europe, the most expensive region, also decreasing the most, dropping around 10% to $539/mt CFR, S&P Global Commodity Insights data showed May 28.

Blue ammonia prices in Asia Pacific remained the lowest, dipping 2% to $381/mt CFR Far East, while prices in the US Gulf were down 5% to $466/mt CFR, The lower prices in each region were attributed to weaker conventional ammonia markets.

May average assessments have not been finalized, but prices appear to have steadied so far in the month.

Platts blue ammonia price assessments are based on the conventional ammonia market price plus a premium reflecting the costs of carbon capture and storage.

The Platts Ammonia Price Chart illustrates monthly averages of daily assessments for gray, blue, and "green ammonia" across a range of geographies and delivery options.

Platts is part of S&P Global Commodity Insights.

Blue ammonia is made from fossil fuel-derived hydrogen, capturing the associated CO2 emissions, while green ammonia uses hydrogen from renewables-powered water electrolysis. Assessments assume a levelized cost of renewable power input for green ammonia.

Green developments

The green ammonia calculated costs of production assessments also fell month over month. These are based on longer-term weighted average capital costs and levelized power costs.

Lower input power prices fed through to declining green ammonia production costs, with global assessments down on the month in April between 4% and 13%..

Platts assessed delivered green ammonia costs in the range of $821-$930/mt, with the lowest average cost for delivery to Far East Asia from the Middle East, and the highest delivered from West Coast Canada to the same destination.

Australia's InterContinental Energy reiterated its aim of producing renewable ammonia below $650/mt from its planned 70-GW Western Green Energy Hub.

And in India, AM Green aims to start renewable ammonia exports by 2027 as part of its plan to produce 5 million mt. The company signed up with Coal India on May 9 for 4.5 GW of renewable energy supply.

Meanwhile in Europe, Hoegh EVI has completed the world's first floating ammonia cracker pilot project in Norway.

The breakthrough technology will enable floating import terminals to produce hydrogen at industrial-scale volumes from transported ammonia, the company said.

Market indicators

The Japan Korea Ammonia Price (JKAP), a market-based CFR assessment of the low-carbon ammonia market in Japan and South Korea, was assessed in line with the market for conventional product in Far East Asia through April. It also reflects the higher cost of freight from major supply hubs to Japan over other Far East Asian markets.

JKAP fell to $345/mt CFR at the end of April from $360/mt at the start, mirroring developments in the conventional ammonia market.

The established ammonia market in Far East Asia remained under pressure in April, with prompt spot demand from CFR buyers in the region thin. Workable prices decreased late in the month to $330/mt CFR as Southeast Asian suppliers sought outlets.

The ammonia market west of the Suez Canal also edged lower, with further consecutive decreases in the influential monthly Tampa, Florida ammonia contract price.

Yara and Moasic agreed to a price of $415/mt CFR Tampa in late April for May deliveries, down from $435/mt for April deliveries, the fifth consecutive month of declines.

The import market for ammonia also moved down through April, reflecting weaker input natural gas prices in Europe, which slipped to around Eur32/MWh at the end of April, down around Eur10/MWh month over month.

Canadian project promise

Mark Carney's victory in the Canadian election is expected to leave Canada's investment tax credits in place and maintain government support for the low-carbon hydrogen and ammonia export potential.

However, with the formation of a minority government, it was difficult to forecast how long it might be until the next election, which added a level of uncertainty to the government's support, a source said.

The source noted the potential for green hydrogen and carbon capture and storage in the country's future energy mix, although such long-term projects may not find the current political environment sufficiently stable.

The low-carbon ammonia developer said Canadian projects could attract increased attention as a trade diversification strategy for global buyers, especially from Europe, due to US tariffs and retaliatory measures.

Marine fuels

In the marine fuel sector, the International Maritime Organization approved new regulations in April aimed at addressing greenhouse gas emissions from maritime activities.

These regulations, set to take effect in 2028, impose two tiers of greenhouse gas intensity standards for ships using conventional oil-based fuels.

In 2028-2030, the IMO set the prices for Tier 1 units at $100/mtCO2e and Tier 2 at $380/mtCO2e.

Ammonia is a leading contender for decarbonizing the maritime industry.

A global hydrogen project developer told Platts that "implementing these regulations will be a significant challenge, not only due to the economic impact on companies that fail to meet reduction targets but also because of the supply chain for e-fuels."

The source emphasized that the timeline for e-fuel projects typically ranges from 28 to 36 months.