Non-Iranian ammonia shipment moves north through the Red Sea; seen as "good first signal"

A shipment of ammonia not linked to Iranian suppliers has passed through the Bab Al-Mandab Strait and into the Red Sea for the first time since December 2023, delivering Omani ammonia to Jordan, tracking software and market sources said Feb. 6.

The 15,000 mt Ard Horizon, which loaded a cargo for OQ Trading at Salalah in Oman Jan. 27-30, discharged for phosphate fertilizer producer Jordan Phosphate Mines Company at Aqaba Feb. 4-5, S&P Global Commodity Insights' Maritime Portal vessel tracking showed.

The transportation of ammonia from the Arab Gulf to the western hemisphere via the Suez Canal reduced significantly from late 2023, when Yemen's Houthi Rebels ramped up attacks on commercial vessels it believed to be linked to Israel, following the beginning of the war in Gaza.

In 2024, only vessels carrying ammonia linked to Iranian suppliers have braved the Bab Al-Mandab Strait, moving product from east to west, solely for delivery to Turkey.

The lifting of ammonia from the Egyptian Red Sea port of Ain Sokhna continued though, with vessels frequently passing south through the Suez Canal to load volumes from EBIC for delivery in Jordan, the Mediterranean Region and Europe.

Meanwhile, gas carriers loaded with ammonia from suppliers in Saudi Arabia and Oman for delivery west of the Suez Canal chose to divert via the Cape of Good Hope instead, adding weeks to journeys.

Market sources were hopeful it could mean an improvement in global ammonia supply, as the loss of the trade flow disconnected markets east and west of the Suez Canal.

"It's a very good first signal to the market that it's now okay to cross the Red Sea," one source said, describing it as "good news."

However, a trader cautioned against getting too excited.

"All top-class ship owners still refuse to pass," the trader said.

An owner of several gas carriers active in the ammonia market confirmed to S&P Global Commodity Insights that it was not currently considering allowing Red Sea transit.

In line with this, a shipbroker said "it will take some time -- certainly for the larger, more established players," while another said most owners were refusing to transit the Red Sea thus far.

The shipbroker added the Ard Horizon would return to Oman to reload after completing the JPMC delivery.