IHS Chemical’s latest report shows that per capita income in Brazil, India and China and other developing countries to increase and flourish structural changes in diet and the United States and Brazil, the biofuels industry is driving the steady growth in global demand for ammonia . But the next few years , global demand growth or ammonia will be the U.S. corn-based bio-fuel production decreased threat.
Reported that in the past five years, the global ammonia market demand grew steadily , with an average annual growth rate of close to 2.5% , the growth in demand from 2009 to 2013 of 153 million tons to over 170 million tons . IHS Chemical expects 2020 annual global ammonia consumption will continue to grow at a rate of over 2% .
IHS chemical ethylene oxide and its derivatives business executives Thyssen Kiir said: ” the global grain supply, strong crop prices and the significant growth in biofuel production and other factors support in the past few years, the global ammonia market performance eye-catching. However, with the rapid increase of new low-cost devices , ammonia production growth is outpacing demand growth , the future of the global overcapacity in this market is facing an unfavorable situation . ”
The report notes that since the 1990s , family incomes in emerging economies continued to grow , leading to the region’s people’s diet changes. People in the diet increased the dairy and animal protein ( such as poultry , pork and beef ) consumption , thereby stimulating the grain, the rapid growth of demand for wheat and other grains , and further drive the growth in demand for nitrogen fertilizer .
IHS agricultural forecasting agency agricultural economist Stuart Ramsay said: “The global grain farmers in order to improve the product , a significant increase in spending in 2013 for nitrogen fertilizer farmers were spending in the U.S. corn and wheat crops around the production process . $ 15 billion and nearly 30 million U.S. dollars for the purchase of fertilizers , we predicted a few years might appear in the future decrease in the cost of fertilizer , mainly due to additional ammonia production capacity in North America led to a substantial increase in the impact of falling demand for imported fertilizers . experienced decades after a decline, the U.S. fertilizer industry in the supply of low-cost natural gas feedstock is being driven by the increase in re- recovery . ”
Another factor leading to the fertilizer / ammonia demand is steadily growing since the beginning of this century biofuel production growth , and growth accelerated from 2005 to 2006 . The world’s two major ethanol producer in the United States ( mainly using corn as raw materials ) and Brazil ( mainly using sugarcane as feedstock ) . Currently, corn is the main crop fertilizer consumption per unit of production in most species. In recent years , the development of the biofuels industry has spurred a growing global crop yields . International Fertilizer Industry Association (IFA) that global fertilizer consumption 3% is used for growing biofuel crops.
However , in recent years, a major factor supporting strong fertilizer demand growth under pressure. November 2013 , the U.S. Environmental Protection Agency (EPA) released its latest proposal in 2014 to add mandatory renewable fuels standard (RFS2) , according to the proposal data projections, 2014 to add the amount of corn ethanol will be reduced to 127 billion to 13.2 billion gallons , lower than the 13.3 billion gallons in 2012 and 2011 of 13.9 billion gallons , and in 2014 added the amount of the statutory standards set forth in the previous RFS2 is 14.4 billion gallons . Decline in demand for biofuels will inhibit U.S. corn acreage and fertilizer demand . Fertilizer demand for corn is the most important North American ammonia terminal market , the current U.S. ethanol production industry annual consumption of about 50 million bushels ( 1 bushel is equivalent to 70 pounds ) of maize, equivalent to 40 % of U.S. corn production.
In addition to biofuels production decline resulting in decreased demand for fertilizer outside , IHS Chemical reported that crop prices will also lead to a decline ammonia demand . The current price of corn and wheat have fallen over the years lows , but prices remained at a healthy level . If the current crop yields in Latin America continues to grow , so the next few months , the global crop prices will continue to face downward pressure .(http://www.lubonchem.com supply)
