Ammonium nitrate

Ammonium Nitrate Market Intelligence Report

I. Price Trends
- Recent Price Volatility: From July 20 to July 27, 2026, the benchmark price of ammonium nitrate declined from RMB 4,330.00/ton to RMB 4,150.00/ton, representing a 4.16% decrease.
- Regional Price Disparities:
- Shaanxi Xinghua Group reduced its ex-factory price by RMB 50/ton on July 1 to RMB 5,300/ton (no subsequent updates reported; the price may have since adjusted into the current benchmark range).
- Shandong Province’s mainstream price remained stable at RMB 4,200–4,300/ton, while Hebei Province experienced a parallel price decline.

II. Supply-Demand Dynamics
- Supply Side:
- Domestic production capacity is ample: annual commercial ammonium nitrate capacity stands at 7.3 million tons, whereas actual demand is approximately 4 million tons—resulting in persistent oversupply.
- Five northern provinces (Shanxi, Henan, Inner Mongolia, Xinjiang, etc.) account for 58% of national output, intensifying regional homogenized competition.
- International producers—including Sumitomo Chemical—raised prices in July; however, domestic manufacturers have not followed suit, primarily due to limited fluctuations in raw material costs (natural gas and coal).
- Demand Side:
- Agricultural Segment: Demand for nitrate-based compound fertilizers continues steady growth; however, the peak spring fertilizer-preparation season has passed, weakening near-term demand support.
- Industrial Segment: Civil explosive demand is buoyed by infrastructure investment—particularly rising in Xinjiang and Southwest China—but high temperature and humidity in Q3 have prompted partial production cuts at some enterprises.

III. Industry Developments & Policy Impact
- International Market:
- Russia suspended ammonium nitrate exports for one month in March, tightening global supply and raising procurement costs for countries such as India and Brazil. However, China—fully self-sufficient (100% self-reliance)—remained unaffected.
- Prices across Northeast Asia, Europe, and Africa diverged due to regional supply-demand imbalances; overall, the Asian market stabilized.
- Domestic Policy:
- The Ministry of Ecology and Environment mandates that nitric acid industry achieve internationally leading N?O emission levels by 2030. To date, five enterprises have installed emission-reduction catalysts, achieving an annual CO?-equivalent reduction of 2.5 million tons.
- Technological innovation—including “gas-to-electricity” retrofitting—has lowered comprehensive energy consumption by 30%, enhancing cost competitiveness.

IV. Corporate Developments
- Leading Enterprises:
- Xuefeng Technology (Xinjiang) maintains a robust regional monopoly position, leveraging exclusive production capacity and significant cost advantages (RMB 650–800/ton lower than inland counterparts).
- Kelong Holdings exhibits high vertical integration and strong pricing flexibility, reinforcing earnings resilience.
- Pricing Adjustments:
- Shaanxi Xinghua reduced its ex-factory price on July 22; Hebei Province followed with parallel declines. Shandong Province held prices steady, though transaction volumes remained weak.

Analysis & Outlook
1. Short-Term Price Pressure:
- Oversupply (excess capacity ~40%) remains the primary driver, compounded by seasonal demand weakness in Q3—suggesting continued downward price pressure.
- Intensified regional competition may lead to low-priced northern supplies spilling over into East and South China markets.
2. Long-Term Support Factors:
- Steady agricultural demand growth (driven by rising adoption of nitrate-based compound fertilizers) and recovery in civil explosive demand (supported by accelerated infrastructure investment) provide a solid floor for prices.
- Stricter environmental regulations will accelerate the exit of outdated capacity, improving industry concentration and profitability.
3. International Market Linkage:
- Uncertainty persists regarding potential future Russian export restrictions; renewed supply curtailment could lift global prices. However, given China’s zero import volume and lack of export activity, external price movements exert minimal direct impact.

Forecast (August–December 2026)
1. Price Range:
- Benchmark price is projected to fluctuate between RMB 4,000–4,300/ton, with a modest rebound expected in Q4 (peak season) to RMB 4,200–4,300/ton.
2. Regional Divergence:
- Prices in Xinjiang and Southwest China are expected to remain relatively firm, supported by dominant local producers’ pricing discipline; conversely, North and East China face greater downward pressure amid intensified competition.
3. Industry Trends:
- Structural optimization of capacity will accelerate, with digitalization, smart manufacturing, and emission-reduction technologies reducing integrated costs. Market share of leading enterprises will further consolidate.
- Export opportunities may gradually emerge as international supply deficits widen—though policy-related risks warrant close monitoring.