SunSirs: Driven by Plant Maintenance and Surging Industrial & Agricultural Demand, the Domestic Ammonia Market Rose Strongly

Last week, the domestic liquid ammonia market experienced a strong upward surge. On the supply side, a concentration of plant maintenance and operational disruptions led to a tightening of available stock; meanwhile, on the demand side, both essential agricultural requirements and industrial procurement saw a simultaneous rebound. Coupled with upward momentum driven by rising international prices, ammonia prices hit a new monthly high. Regional market performance showed distinct divergence, with the Shandong region recording particularly significant gains.

Price Performance

Last week (April 13–17), the domestic liquid ammonia market trended upward. According to the SunSirs Commodity Market Analysis System, the weekly increase in liquid ammonia prices in the Shandong region reached 11.22%. As of the 17th, the mainstream price range for liquid ammonia in the Shandong region stood at 2,900–3,200 RMB/ton.

Supply Side: Concentrated plant maintenance led to a temporary shortage of supplies.

Declining Operating Rates: Multiple production units across North and East China have entered scheduled maintenance periods; compounded by unexpected mechanical failures, overall operating rates have declined. Consequently, ammonia output has dropped significantly in major production hubs such as Shandong, Jiangsu, and Henan.

Ammonia Producers Hold Firm on Pricing: Amidst tight supply, ammonia producers—particularly those in the Shandong region—are demonstrating a strong resolve to maintain price levels. Some enterprises are actively managing order volumes; consequently, prices were raised multiple times last week, resulting in an aggregate price hike exceeding 200 RMB per ton. Corporate inventories remain at low levels, further intensifying the tense atmosphere within the market. Expectations for Production Resumption: Most facilities currently offline due to technical faults are expected to gradually resume production after April 20, which may help alleviate short-term supply pressures.

Demand Side: Robust Demand from Both Agricultural and Industrial Sectors; Purchasing Enthusiasm Rises

Agricultural Demand: The peak season for spring plowing fertilizers continues; operating rates at compound fertilizer manufacturers remain at high levels, and rigid demand for nitrogen fertilizers is being steadily released, thereby supporting an upward trend in ammonia prices. Industrial Demand: Rigid demand from downstream industrial sectors—such as acrylonitrile, caprolactam, and nitric acid—remains stable; meanwhile, demand for high-purity liquid ammonia from the semiconductor and hydrogen energy sectors has surged, leading to tight supplies of high-end products.

Export-Driven Growth: Rising international ammonia prices and an increase in export orders are diverting domestic supplies, thereby boosting domestic market sentiment. China's CFR quotation stands at $670 per ton—an increase of $50 per ton (8%) compared to the beginning of the month—as tight supply conditions in the Middle East continue to drive up prices in the international market.

Market Outlook

According to analysts at SunSirs, the ammonia market is expected to retain some upward momentum in the short term. On the supply side, the current tight supply landscape is unlikely to change significantly until production facilities resume operations; although some ammonia producers have recently scheduled restarts, it will take some time for supply levels to be replenished. Furthermore, sustained rigid demand continues to provide support, suggesting that ammonia prices may remain volatile at elevated levels. However, high prices are intensifying a "wait-and-see" sentiment among downstream buyers. Going forward, key factors to watch include the progress of facility restarts, production adjustments at co-production plants, and shifts in the pace of downstream procurement. It is anticipated that the market's upward trajectory will eventually be constrained by the resumption of plant operations, leading to a market environment characterized primarily by high-level price fluctuations.

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