Indian Ammonia Market Report and Forecast 2024-2032

India Ammonia Market Size

The ammonia market in India reached a consumption volume of about 18.29 million metric tons in 2023. The market is expected to grow at a CAGR of 8.2% in the forecast period of 2024-2032 to reach about 37.17 million metric tons by 2032.

India Ammonia Market Growth

The Asia Pacific was the leading ammonia-producing and consuming region in 2020. China is the leading producer of the product in the region. In the forecast period of 2024-2032, the CAGR of the Asia Pacific market is expected to increase at a rate of nearly 3%, boosting the growth of India ammonia market. Ammonia is manufactured mainly from coal gasification in China, whereas it is primarily obtained from natural gas globally. China is followed by India and Indonesia in terms of industry development of the product. The capacity of the product is expected to increase dramatically globally in the coming years.

The ammonia phosphate fertilizers sector dominates the end-use sectors in the industry in India. It is considered to be a vital nitrogen source for plant growth. Ammonia consumption in India is also increased by the production of different liquid fertilizer solutions consisting of ammonium nitrate, water ammonia, and urea. The product is widely used for agricultural applications as it reacts quickly with clay particles, organic matter, free hydrogen ions, and groundwater (which inhibits the volatilization of ammonia).

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India Ammonia Market Trends

India is establishing itself as a significant participant in the renewable ammonia market, having already signed several international trade agreements and with more in the pipeline which can aid the growth of the market. The country's goal to generate 5 million metric tons (mt) of renewable hydrogen by 2030 and capture a 10 per cent share of the global trade by that time highlights its dedication to renewable energy as a critical trend in the ammonia market.

Recent Developments

KBR announced on July 2024 that it has been chosen by OCIOR Energy for its green ammonia technology, K-GreeN® in Odisha, India. KBR will supply technology licenses, equipment, and catalyst solutions to OCIOR for its facility which is set to have a capacity of around 600 metric tons per day.

Industry Outlook

According to ITC Trademap, in 2023, India imported 2,336,714 tons of ammonia from various countries, reflecting a slight increase from 2,243,843 tons in 2022. Imports from Saudi Arabia reached 953,287 tons, significantly up from 930,631 tons in 2022, indicating strong demand. As per the India ammonia industry analysis, Oman saw a substantial rise, exporting 385,643 tons to India in 2023, up from 103,172 tons in 2022.

Bahrain's exports to India increased to 372,783 tons in 2023 from 235,816 tons in 2022, showcasing growing trade volumes. Imports from Indonesia rose to 192,121 tons in 2023 compared to 253,908 tons in 2022. As per the India ammonia market dynamics and trends, Qatar's exports to India increased to 119,845 tons in 2023 from 374,716 tons in 2022, indicating fluctuating volumes.

Malaysia's exports to India were 95,208 tons in 2023. The United Arab Emirates and Egypt showed stable export trends, with Egypt exporting 32,334 tons to India in 2023.

As per Food and Agriculture Organization (FAO), the fertilizer consumption as a percentage of fertilizer production in India increased from 152.7% in 2018 to around 156.5% in 2019. As per the ammonia industry in India, this upward trend continued, reaching approximately 176% in 2020. However, by 2021, consumption decreased to around 160.6%.

According to the Fertiliser Association of India, the all-India estimated consumption based on DBT sales for 2022-23 saw Urea at 35.73 million MT and DAP at 10.53 million MT, recording increases of 4.5% and 13.6% respectively over 2021-22 which shows an increase in India ammonia industry revenue. However, the consumption of NP/NPK complex fertilizers at 10.07 million MT, MOP at 1.63 million MT, and SSP at 5.02 million MT declined by 12.2%, 33.6%, and 11.7% respectively during this period. The total consumption of all fertilizer products stood at 63.92 million MT in 2022-23, showing a slight decline of 0.03% compared to 2021-22.

Factors Contributing to the Growth of the Ammonia Market in India

• Large domestic production is aiding the India ammonia market value.

• Proximity to key agricultural regions ensures efficient distribution and use of ammonia in fertilizers.

• Favorable policies and subsidies in the agricultural sector support ammonia demand for fertilizer production

Challenges Faced by Manufacturers in the Ammonia Market of India

• High production costs due to expensive raw materials and energy prices can influence the ammonia demand forecast.

• Environmental concerns like energy-intensive production and pollution issues.

• Reliance on imports for meeting total demand.

Key Growth Opportunities in the India Ammonia Market Share

• Modern technologies to reduce costs and environmental impact.

• Expanding exports to neighbouring countries.

• Development using renewable energy sources. 

Global Market Volatility and Rising Competition Impacting the Market Growth 

• Global market volatility due to fluctuations in global ammonia prices can influence the ammonia demand growth.

• Higher compliance costs due to environmental regulations

• Rising competition from other major producers

Market Competition

The key players in the India ammonia market include India Farmers Fertiliser Cooperative Limited (IFFCO), Rashtriya Chemicals and Fertilizers (RCF), National Fertilizers Limited (NFL), Gujarat State Fertilizers & Chemicals (GSFC), Chambal Fertilizers and Chemicals Limited, Tata Chemicals, Deepak Fertilisers and Petrochemicals Corporation Limited (DFPCL), and Zuari Agro Chemicals Limited.

Competitive Strategies by Key Players in the Market

Research and Development (R&D): IFFCO invests heavily in R&D to improve ammonia production efficiency and develop eco-friendly products. RCF focuses on innovative production processes to enhance yield and reduce costs. NFL emphasizes R&D to improve product quality and sustainability.

Market Expansion: GSFC increases the India ammonia market opportunities through strategic partnerships and acquisitions. Chambal Fertilizers and Chemicals Limited pursues market expansion by exploring new regional markets and increasing export activities.

Sustainability Initiatives: Tata Chemicals implements sustainability practices by reducing its carbon footprint and promoting green ammonia to stay ahead of other ammonia manufacturers in India. DFPCL focuses on sustainable production methods and energy-efficient technologies.

Cost Management: Zuari Agro Chemicals Limited adopts cost-cutting measures and streamlines operations to maintain profitability. IFFCO utilizes economies of scale to reduce production costs and enhance competitiveness.

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India Ammonia Industry Segmentation

Ammonia refers to a colourless gas having an and extremely unpleasant odour which is suffocating. It dissolves readily in water and also forms a solution of ammonium hydroxide. The solution can also result in burns and irritation. Its gaseous form can quickly be compressed and, in its liquid form under pressure is colourless and transparent. It is typically delivered in the form of compressed liquid in steel cylinders. It is not highly combustible but can explode if exposed to high heat. Ammonia is used as a refrigerant because of its benefits, like high performance, environmentally friendly, requiring smaller pipes, and improved heat transfer features which can aid the growth of the India ammonia industry.

Based on physical forms, the market can be divided into:

• Anhydrous Ammonia

• Aqueous Ammonia

On the basis of application, the market is segmented into:

• Urea

• Ammonium Phosphate Fertilisers

• Industrial

• Others

The regions in the market include:

• North Region

• East and Central Region

• West Region

• South Region 

India Ammonia Market Analysis

Fertilizer is the primary end-use industry for ammonia in India and it is also the major industry driver in the country at present. The growing food demand due to population growth and the growing emphasis on production protection can enhance the expansion of the India ammonia market. The industrial usage of the product in refrigeration is also an increasing end-use segment in India, which is propelling the demand of India ammonia market. The rise in urbanisation is expected to accelerate the industry for ammonia in refrigerant applications for residential and commercial buildings. The processing of ammonium nitrate, which is a key component in the mining and explosives industry, is a further important application of ammonia. In the coming years, the rising domestic ammonium nitrate production is expected to increase the demand for ammonia in India. In addition, the India government's strong support is also catalysing the India ammonia demand. Thus, the growing demand for the product is projected to drive the India ammonia market in the forecast period.

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Competitive Landscape

The report gives a detailed analysis of the following key players in the India ammonia market, covering their competitive landscape, capacity, and latest developments like mergers, acquisitions, and investments, expansions of capacity, and plant turnarounds:

• National Fertilizers Limited

• Krishak Bharati Co-Operative Limited (KRIBHCO)

• Rashtriya Chemicals and Fertilizers Ltd (RCFL)

• Ramagundam Fertilizers and Chemicals Limited

• India Farmers Fertiliser Cooperative Limited

• Gujarat Narmada Valley Fertilizers & Chemicals Limited

• MATIX Fertilisers & Chemicals Ltd.,

• Mysore Ammonia Pvt. Ltd.

• Yara Fertilisers India Private Limited

• Nagarjuna Fertilisers & Chemicals Ltd.

• Malanadu Ammonia Pvt. Ltd.

• Others

The comprehensive EMR report provides an in-depth assessment of the India ammonia market based on the Porter's five forces model along with giving a SWOT analysis. The report also provides the price trends and trade analysis of ammonia.

India Ammonia Market Regional Analysis

An agreement was reached for the production plant of 1.1 million tonnes of ammonia per year in Thoothukundi, which runs on 5 GW of solar PV capacity and 1.5 GW of electrolyzer capacity in July 2022 in Tamil Nadu, India and can increase the ammonia market share in India. Additionally, ACME has been running a solar-to-ammonia pilot facility in Rajasthan, India since November of 2021.

Key Highlights of the Report

Indian Ammonia Market Report Snapshots

Indian Ammonia Market Size

Indian Ammonia Market Growth

Indian Ammonia Market Trends

Indian Ammonia Companies

Indian Ammonia Market Regional Analysis