Natural gas is the key raw material for the production of nitrogen fertilizers such as ammonia and urea. Due to the abundant availability of natural gas, the nitrogen fertilizer industry
is fragmented among several producers
. Therefore, natural gas prices have a significant impact on nitrogen fertilizer producers.
What factors affect the cost of fertilizers?
Fertilizer prices are driven by
industry capacity, rivalry (competition among firms)
, marginal producers' cost, proximity to customers, inventory, and demand. Demand, in turn, is driven by fertilizer prices, crop economics, currencies, cycles, economic activity, and macro factors like subsidy programs.
What affects natural gas prices?
Factors on the demand-side include
weather (temperatures)
, economic conditions, and petroleum prices. Cold weather (low temperatures) increases demand for heating, while hot weather (high temperatures) increases demand for cooling, which increases natural gas demand by electric power plants.
Why is the price of fertilizers high?
Strong demand from key crop-growing regions
has been the driving force behind high fertilizer prices. … Higher farm revenue has increased crop acreage and application rates of key nutrients like phosphates and potash.
Does the price of oil affect the price of natural gas?
Correlation: Understanding the Numbers
A correlation coefficient between crude oil and natural gas of 0.25 indicates that a change in oil price can account for
25% of the change
in natural gas prices (on average, throughout the study period).
What is the price of manure?
Organic Manure, Pack Size: 25 Kg,
Rs 10 /kg
Agrocart | ID: 10579107455.
Why is fertilizer so volatile?
The prices of raw material inputs contribute
to the volatility in fertilizer prices. . It takes approximately 33,500 cubic feet of natural gas to produce one ton of anhydrous ammonia (82-0-0). … Anhydrous ammonia is then used to manufacture dry N fertilizers, such as ammonium nitrate (34-0-0) and urea (46-0-0).
Will natural gas prices rise in 2020?
The government forecast the average price of natural gas this year will be
$4.69 per mmBtus
. … “As a result of the higher expected natural gas prices, the forecast share of electricity generation from coal rises from 20% in 2020 to about 24% in both 2021 and 2022,” according to EIA.
What country consumes the most natural gas?
| # Country Yearly Gas Consumption (MMcf) | 1 United States 27,243,858,000 | 2 Russia 15,538,246,850 | 3 China 6,738,151,620 | 4 Iran 6,567,636,495 |
|---|
Why did price of natural gas go up?
High gas prices
“Higher natural gas prices this year primarily reflect two factors:
growth in liquefied natural gas exports and rising domestic natural gas consumption for sectors other than electric power
,” according to the outlook.
How much does fertilizer cost per ton?
Anhydrous was up 22% compared to last month and had an average price of
$685/ton
; 10-34-0 was 7% higher compared to the prior month and had average price of $599/ton. Urea was 6% more expensive than the prior month and had an average price of $502/ton.
How much does urea cost per ton?
DAP had an average price of $670 per ton, urea
$541/ton
and UAN32 $420/ton. The remaining fertilizers only saw their price change by about 1%. MAP cost $720/ton, 10-34-0 $625/ton, anhydrous $724/ton and UAN28 $366/ton. On a price per pound of nitrogen basis, the average urea price was at $0.59/lb.
What is the current price of fertilizer?
Four fertilizers' prices increased 2% compared to last month. MAP had an average price of
$729/ton
, anhydrous $732/ton, UAN28 $371/ton and UAN32 $421/ton. 10-34-0, at $624/ton, was 1% higher. On a price per pound of nitrogen basis, the average urea price was at $0.60/lb.
Why is natural gas cheaper than oil?
When one commodity becomes more expensive than the other, there is often a reason for it. In the case of oil vs. natural gas, it is usually supply and demand that drives the change.
Proven and probable reserves of natural gas cause a dramatic price drop
.
Which is better natural gas or oil?
On a global level,
gas
is also safer than heating oil for the planet because natural gas sends 25 percent less carbon dioxide into the atmosphere than oil.
Is natural gas more expensive than oil?
Compared to oil,
natural gas is less expensive
. The average natural gas bill in winter 2014 to 2015 was $642, and natural gas tends to be one of the least expensive fuel options overall. The efficiency of natural gas systems varies. The best quality systems are more than 90 percent efficient.
