Adds to Existing Suite of Ammonia Price Assessments and Brings Greater Transparency and Certainty to Evolving Marketplace
SINGAPORE/ LONDON/ NEW YORK (April 26, 2022) – S&P Global Commodity Insights, the leading independent provider of information, analysis and benchmark prices for the commodities and energy markets, has begun publishing a daily Platts forward curve for conventional ("gray) ammonia, effective April 26, 2022. The price assessments add to Platts ammonia coverage, which already includes grey ammonia cargo price assessments launched in October 2021 and low-carbon ("blue") ammonia price valuations, which Platts began assessing April 22, 2022.
Jeffrey McDonald, S&P Global Commodity Insights Pricing Specialist for Hydrogen & Ammonia in Europe, said: "Market interest is expected to continue to grow in ammonia as new markets that open up in power and bunker fuels look to use low carbon ammonia as a decarbonization fuel. Ammonia's potential to decarbonize these sectors is likely to impact ammonia supply chains and having a view of forward prices will be increasingly important to navigate these changes. The new Platts ammonia forward curves will provide increasing price transparency for a market that can be impacted by the volatility in related markets, as well as seasonal factors."
S&P Global Commodity Insights has begun publishing ammonia forward curves for three forward months in three regions – Northwest Europe, the US Gulf Coast, and the Middle East. Prices are assessed in USD per metric ton and USD per MMBtu. Source data include broker marks, spot transactions and term deals normalized for terms and credit. The curves will also take into account current ammonia prices, historical price spreads and trend analysis, as well as forward pricing for related commodities such as natural gas and crude oil.
Understanding the forward price of ammonia could bring additional confidence over time in price risk strategies such as hedging, as well as investing in ammonia production facilities. Increased confidence could boost liquidity and promote international trade, including exchange settlement transactions.
S&P Global will continue to monitor the ammonia markets for signs of trading, including additional regional locations and further pricing along the forward curve. Forward curve prices for low-carbon ammonia also may be considered as markets develop over time.
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