During the last month of 2024, Ammonium Nitrate prices remained volatile prevailing mixed trend in the global market. The prices surged in the western market however moved southwards in the Asian market with India being the most affected region. The approaching planting season increased demand, while a shortage of nitrogen-based fertilizers, exacerbated by severe weather disruptions across key production regions, created significant supply constraints.

In the European market for Ammonium Nitrate, prices saw a significant increase despite a drop in ammonia costs, which is a fundamental raw material in Ammonium Nitrate production. The typical correlation between ammonia prices and Ammonium Nitrate costs was overshadowed by other influential market forces. The primary catalyst for the price surge was robust restocking activity, as manufacturers and suppliers aimed to rebuild inventories ahead of the agricultural season and to mitigate potential supply chain disruptions. Furthermore, the weather phenomenon known as "Dunkelflaute," which results in reduced output from solar and wind energy sources, has sparked concerns about rising electricity expenses. This development may drive up production costs, further straining the supply of Ammonium Nitrate. Additionally, this scenario could exacerbate political tensions and disrupt energy and transportation infrastructure, adding complexity to supply chain operations for this commodity. These combined factors are anticipated to keep Ammonium Nitrate prices on an upward trajectory in the European market, as both demand-side and cost-related pressures continue to shape the industry's outlook.

Similarly, in the North American market the prices of Ammonium Nitrate experienced a slight uptick. As 2024 came to a close, the North American fertilizer market, particularly in the United States, faced significant inventory constraints, most prominently within the nitrogen segment. This tightening of supply has exerted upward pressure on prices, creating a cautious market sentiment as the industry prepares for the upcoming spring season, a peak period for fertilizer demand. The disparity between supply and demand has widened, further intensifying Ammonium Nitrate price hikes. Factors contributing to this situation include production challenges, logistical disruptions, and sustained demand from the agricultural sector, which remains reliant on nitrogen-based fertilizers to maximize crop yields. These conditions have prompted market participants to adopt a wary approach, with concerns about how nitrogen-based fertilizers inventory shortfalls might impact the availability of Ammonium Nitrate during critical planting months.

However, in the Indian market, the prices of Ammonium Nitrate slumped by a slight margin. This price dip is primarily attributed to consistent demand from the key downstream fertilizer market, where most inquiries for Ammonium Nitrate are based on contractual agreements. Traders have either already released or are awaiting the release of their tenders for Ammonium Nitrate. On the supply side, the availability of sufficient inventories of both domestically produced and imported Ammonium Nitrate, has ensured a smooth flow of cargoes into the Indian market.

As per ChemAnalyst's projections, the global prices of Ammonium Nitrate are predicted to escalate, driven by the anticipated rise in fertilizer demand for the forthcoming winter planting period. The seasonal uptick in agricultural activities, coupled with ongoing supply limitations, is expected to exert upward pressure on prices, with constrained availability and robust demand influencing market trends.