Granular Urea Market Growth 2023, Latest Insights, Future Trends, Regional Landscape and Forecast to 2030

Posted by Pearl Smith on May 18th, 2023

Granular urea is a solid, crystalline form of urea that is commonly used as a nitrogen fertilizer in agriculture. Urea itself is a white, organic compound with the chemical formula (NH2)2CO. It is a primary source of nitrogen for plants and is widely used to promote healthy growth and increase crop yields. Granular urea is produced by the reaction of ammonia and carbon dioxide under high pressure and temperature. The resulting urea is then processed into small, uniform granules, making it easier to handle, store, and apply to the soil. The granules can be spread using various methods such as broadcasting or applied directly to the soil through irrigation systems.

The main advantage of granular urea is its high nitrogen content. Typically, granular urea contains around 46% nitrogen by weight, which is higher than other commonly used nitrogen fertilizers like ammonium nitrate or ammonium sulfate. This high nitrogen concentration makes granular urea an efficient and cost-effective fertilizer.

When applied to the soil, granular urea undergoes a chemical reaction called hydrolysis, where it breaks down into ammonium ions and carbonate ions. The ammonium ions can be taken up by plant roots and used for growth and development, while the carbonate ions can react with soil minerals and eventually release more ammonium ions for plant uptake. It's important to note that urea is a fast-release fertilizer, which means that it provides an immediate supply of nitrogen to the plants. However, it can also be susceptible to volatilization, where the nitrogen is lost to the atmosphere as ammonia gas if not incorporated into the soil or watered in promptly.

The granular urea market refers to the global trade and demand for granular urea as a fertilizer product. It is an essential component of the agricultural industry and plays a significant role in supporting crop production worldwide. Here are some key points about the granular urea market:

Market Size: The granular urea market is substantial, with a high demand for nitrogen fertilizers in agriculture. It is one of the most commonly used nitrogen fertilizers globally. The market size is influenced by factors such as population growth, increasing food demand, and the need to improve agricultural productivity.

Production: Granular urea is produced in various countries around the world. Major producers include China, India, the United States, Russia, and several countries in the Middle East. These countries have abundant natural gas resources, which are essential for the production of urea through the Haber-Bosch process.

Consumption: The consumption of granular urea is primarily driven by the agricultural sector. Farmers and growers use granular urea to supply nitrogen to crops, enhancing their growth and yield. The demand for granular urea varies depending on factors such as crop type, soil conditions, and regional agricultural practices.

International Trade: Granular urea is traded globally, with significant import and export activities. Countries with high agricultural production but limited domestic production of urea may import it to meet their fertilizer requirements. Conversely, countries with surplus urea production may export it to other regions. Key players in the international trade of granular urea include China, India, the United States, and various countries in the Middle East.

Market Factors: The granular urea market is influenced by several factors, including agricultural policies, government subsidies, weather conditions, crop prices, and environmental regulations. Fluctuations in these factors can impact the demand, supply, and pricing of granular urea.

Market Trends: The granular urea market is subject to ongoing trends and developments. These include the increasing focus on sustainable agriculture and the development of precision farming techniques. There is also a growing emphasis on enhancing fertilizer efficiency, minimizing environmental impacts, and exploring alternative sources of nitrogen.

Price Dynamics: Granular urea prices can be influenced by factors such as energy costs (natural gas prices), supply-demand dynamics, transportation costs, and global economic conditions. Price volatility is not uncommon in the fertilizer market.

The granular urea market has experienced steady growth over the years, driven by several factors that contribute to the increasing demand for nitrogen fertilizers in agriculture. Here are some key factors influencing the growth of the granular urea market:

Population Growth and Food Demand: The world's population continues to grow, increasing the demand for food. To meet this demand, farmers require efficient fertilizers like granular urea to enhance crop yields and productivity. The rising global population acts as a significant driver for the growth of the granular urea market.

Technological Advancements: Advancements in agricultural technologies and practices have led to the adoption of more intensive and productive farming systems. These systems often rely on nitrogen fertilizers like granular urea to supply essential nutrients to crops. The increasing adoption of precision agriculture and controlled-release fertilizers also contributes to the growth of the granular urea market.

Expansion of Agricultural Land: As agricultural land expands to meet growing food demands, the need for nitrogen fertilizers increases. Granular urea, with its high nitrogen content and ease of application, becomes a preferred choice for farmers looking to improve soil fertility and crop production on newly cultivated lands.

Government Support and Subsidies: Many governments provide support and subsidies to farmers to encourage the use of fertilizers, including granular urea. These initiatives aim to promote sustainable agriculture, improve food security, and boost rural economies. Government policies and incentives can stimulate the growth of the granular urea market by making it more affordable and accessible to farmers.

Shift towards High-Value Crops: The global agricultural sector has witnessed a shift towards high-value crops, such as fruits, vegetables, and cash crops. These crops often have higher nutrient demands, including nitrogen, to achieve optimal yields and quality. Granular urea, being a concentrated nitrogen fertilizer, meets the nutrient requirements of these high-value crops, thereby driving its market growth.

Increasing Global Trade: The granular urea market benefits from international trade, with countries importing and exporting urea based on their agricultural needs and production capabilities. Growing global trade networks and favorable trade policies contribute to the expansion of the granular urea market.

Sustainable Agriculture Practices: There is a growing emphasis on sustainable agriculture and environmental stewardship. Granular urea, when used judiciously and in line with recommended application practices, can contribute to sustainable farming systems by improving nutrient-use efficiency and minimizing environmental impacts. The increasing adoption of sustainable agriculture practices supports the growth of the granular urea market.

Major players operating in the global granular urea market include CF Industries Holdings, Inc., Yara International ASA, Saudi Arabian Fertilizer Company, Nutrien Ltd., Ostchem Holding, EuroChem Group, Bunge Limited, CVR Partners LP, Luxi Chemical Group Co.,Ltd., and Coromandel International Ltd.

The demand for granular urea in the market is influenced by various factors related to agriculture, economic conditions, and government policies. Here are some key factors that impact the demand for granular urea:

Agricultural Practices: The primary driver of granular urea demand is its role as a nitrogen fertilizer in agriculture. Farmers and growers use granular urea to supply nitrogen to crops, which is essential for their growth and development. The demand for granular urea is influenced by factors such as crop type, farming techniques, and soil conditions.

Crop Production and Food Demand: The demand for granular urea is directly linked to crop production and the global demand for food. As the population continues to grow, there is an increasing need to produce more food. This drives the demand for granular urea as a fertilizer to enhance crop yields and meet the growing food demand.

Economic Factors: Economic conditions, including GDP growth, income levels, and consumer purchasing power, can affect the demand for agricultural products. When the economy is strong, farmers may have more resources to invest in fertilizers like granular urea, leading to increased demand. Conversely, during economic downturns, the demand for granular urea may be affected.

Government Policies and Subsidies: Government policies and subsidies play a significant role in shaping the demand for granular urea. Many governments provide support and incentives to farmers to encourage the use of fertilizers. Subsidies can make granular urea more affordable and accessible, thereby increasing its demand in the market.

Environmental Regulations and Sustainability: Environmental regulations and growing concerns about sustainability influence the demand for granular urea. Sustainable agricultural practices aim to minimize environmental impacts and improve nutrient-use efficiency. Granular urea, when used in accordance with recommended practices, can contribute to sustainable agriculture, driving its demand among farmers adopting these practices.

Weather Conditions: Weather conditions, such as rainfall patterns and droughts, can impact the demand for granular urea. Adequate rainfall promotes crop growth and increases the need for fertilizers, including granular urea. Conversely, drought conditions may reduce the demand for fertilizers as farmers adjust their cropping strategies.

International Trade: The demand for granular urea is also influenced by international trade dynamics. Countries with limited domestic production of granular urea may rely on imports to meet their fertilizer requirements. Trade agreements, tariffs, and transportation costs can affect the availability and cost of granular urea in different regions, impacting its demand.

The granular urea market has widespread applications in the agricultural sector as a nitrogen fertilizer. Here are the main applications of granular urea:

Crop Production: Granular urea is primarily used to supply nitrogen to crops, promoting their growth and development. It is applicable to a wide range of crops, including grains, oilseeds, vegetables, fruits, and grasses. The nitrogen in granular urea supports key plant functions such as photosynthesis, protein synthesis, and overall plant vigor.

Field Crops: Granular urea finds extensive use in field crop production. It is commonly applied to crops like corn, wheat, rice, soybeans, cotton, and sugarcane. The granules can be broadcasted across the field or incorporated into the soil during planting or top-dressing applications.

Horticulture and Specialty Crops: Granular urea is also applied in horticultural and specialty crop production. It is suitable for fruits, vegetables, nursery plants, and ornamental flowers. Granular urea can be spread around the base of plants or incorporated into the soil prior to planting.

Pastures and Forages: Granular urea is used in grazing systems and forage production to enhance the nutritional value and yield of grasses and legumes. It helps to increase the protein content of forage crops, making them more suitable for livestock feed.

Turf and Lawns: Granular urea is applied to turfgrass and lawns to promote healthy growth and maintain vibrant green color. It is often used in professional sports fields, golf courses, residential lawns, and parks to provide a consistent supply of nitrogen for vigorous grass growth.

Controlled-Release Fertilizers: Granular urea can also be utilized as a component in controlled-release or slow-release fertilizers. These formulations release nitrogen gradually over an extended period, providing a sustained supply of nutrients to plants and reducing the risk of nutrient leaching or volatilization.

Blending and Compound Fertilizers: Granular urea can be used as a component in blended fertilizers or compound fertilizers. Blending granular urea with other nutrient sources allows for customized nutrient ratios to meet specific crop requirements. This enables farmers to tailor fertilizers based on soil nutrient levels and crop nutrient demands.

The granular urea market offers several benefits to the agricultural sector and crop production. Here are some key benefits associated with the use of granular urea:

High Nitrogen Content: Granular urea typically contains around 46% nitrogen by weight, which makes it a concentrated source of nitrogen. This high nitrogen content provides crops with a readily available nutrient for growth, promoting healthy plant development and improving crop yields.

Cost-Effective: Granular urea is often considered a cost-effective nitrogen fertilizer option. It offers a high concentration of nitrogen, making it an efficient choice for supplying nutrients to crops. The relative affordability of granular urea compared to other nitrogen fertilizers contributes to its widespread use in agriculture.

Versatility: Granular urea can be used for a wide range of crops, including field crops, horticultural crops, forages, and turfgrass. Its versatility makes it suitable for different agricultural systems, allowing farmers to address the nitrogen requirements of various crops and soil conditions.

Ease of Handling and Application: Granular urea is manufactured in small, uniform granules, which makes it easy to handle, transport, and apply. The granules can be spread using conventional fertilizer spreaders or incorporated into the soil during planting. The ease of application contributes to the efficiency and convenience of using granular urea as a fertilizer.

Immediate Nutrient Availability: Granular urea is a fast-release fertilizer, meaning that it provides an immediate supply of nitrogen to plants after application. This quick availability of nutrients supports rapid growth and ensures that plants have access to nitrogen during critical growth stages.

Source of Nitrogen and Carbon: Granular urea releases ammonium ions and carbonate ions upon hydrolysis in the soil. The ammonium ions serve as a source of nitrogen for plant uptake, while the carbonate ions can react with soil minerals and gradually release more ammonium ions. This dual nutrient release mechanism provides a sustained supply of nitrogen to plants over time.

Compatible with Blending and Formulation: Granular urea can be easily blended with other fertilizers and nutrients to create customized blends or compound fertilizers. This flexibility allows farmers to adjust nutrient ratios based on specific crop needs and soil conditions, optimizing nutrient management for improved crop performance.

Enhanced Crop Productivity: By supplying crops with nitrogen, granular urea supports essential plant functions, such as photosynthesis, protein synthesis, and overall growth. Adequate nitrogen availability through granular urea can lead to increased crop productivity, improved yield, enhanced quality, and better economic returns for farmers.

It is important to note that while granular urea offers many benefits, its proper and responsible use is crucial to minimize potential environmental impacts. Appropriate application techniques, timing, and dosage should be followed to ensure efficient nutrient utilization and minimize nitrogen losses through volatilization or leaching.