Saudi Arabia Fertilizer Market to Grow at a CAGR of 7.4% from 2022 to 2027 – ResearchAndMarkets.com

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DUBLIN–(BUSINESS WIRE)–The “Saudi Arabia Fertilizer Market – Growth Trends, Covid-19 and Forecast (2022-2027)” report has been added to from ResearchAndMarkets.com offer.

The fertilizer market in Saudi Arabia is expected to register a CAGR of 7.4% during the forecast period (2022-2027). The effects of COVID-19 have been severe on the economy in all sectors of Saudi Arabia, leading to labor shortages, temporary factory closures and reduced operating rates across all sectors. industrial sectors of the country.

Even though factories have resumed operations, there have been shipping and logistics issues. Thus, finding air, sea or land freight was a major disruptive factor for companies involved in the industry. Higher costs of containers and shipping, transportation and storage have driven up fertilizer prices.

Over the years, Saudi Arabia, a country that receives an average of about four inches of rain each year, has sought to develop its agricultural sector to achieve self-sufficiency in food security. Thus, the application of fertilizers to improve crop growth and yield is expected to become crucial, creating increased demand for fertilizers.

The fertilizer market in Saudi Arabia is expected to register a CAGR of 7.4% during the forecast period (2022-2027). The effects of COVID-19 have been severe on the economy in all sectors of Saudi Arabia, leading to labor shortages, temporary factory closures and reduced operating rates across all sectors. industrial sectors of the country.

Even though factories have resumed operations, there have been shipping and logistics issues. Thus, finding air, sea or land freight was a major disruptive factor for companies involved in the industry. Higher costs of containers and shipping, transportation and storage have driven up fertilizer prices.

Although nitrogen fertilizer segment took the largest share of the market with a share of 39.3% in 2021, the application of potassium fertilizer is increasing at a rapid rate as it can improve plant tolerance to abiotic stress , especially lack of water, which can otherwise significantly reduce crop yields. The production of fruits and vegetables has developed in the country.

Additionally, the COVID-19 pandemic has highlighted the importance of developing local food sources. Thus, increase in agricultural activity due to various government initiatives to achieve self-sufficiency is expected to boost the fertilizer market in the country during the forecast period.

Main market trends

Increase the export potential of fertilizers

Saudi Arabia is the largest ammonia exporter in the GCC region. Ammonia exports are mainly destined for the Indian market, with the rest being diverted to other Asian and African countries. There are various potential sales destinations for Saudi ammonia producers in Asia-Pacific, including China, Japan, South Korea, Thailand and Vietnam. Arab producers have a competitive advantage in supplying the Asia-Pacific region (especially South and Southeast Asia) compared to its other European, African and South American counterparts.

According to ITC trade, the export quantity of urea increased during the period 2017-2020 in Saudi Arabia. The country’s urea exports were recorded at 3,797.5 thousand metric tons in 2017 and reached 4,428.7 thousand metric tons in 2020. Thailand was Saudi Arabia’s main destination, with a share in value by 23.9% in 2020. Other destinations include the United States, Australia, South Africa and New Zealand.

The availability of natural gas at an attractive price in the country gives the advantage of low production cost. The ability of producers to run plants efficiently and reliably makes building integrated, export-oriented urea plants very attractive. This is expected to drive the overall market growth.

Nitrogen Fertilizers Dominate the Product Type Segment

Saudi Arabia accounts for about one-third of the GCC’s fertilizer export volume of approximately 7.2 million metric tons, with urea accounting for 53% and the remainder split between ammonia and DAP. Saudi Arabia depends mainly on imports for its domestic consumption of vegetables. To avoid total dependence on vegetable imports, the Saudi government has formulated policies that encourage farmers to grow crops that require little water rather than crops that consume more water. Vegetable yield increased from 174,026 hg/ha in 2016 to 176,524 hg/ha in 2018, thanks to improved water conditions.

Moreover, the increase in the cultivation of vegetable crops (tomatoes) mainly drives the demand for ammonium sulfate as it also helps in plant growth by providing nitrogen. Domestic demand for ammonium sulphate is mainly met by imports. SafSulphur company is one of the leading companies that offer good quality ammonium sulphate in Saudi Arabia.

Imports of ammonium sulphate into the country have grown steadily over the review period. For example, according to ITC trade, the import of ammonium sulphate increased from 1,981 metric tons in 2019 to 2,126 metric tons in 2020, indicating possible market growth in the coming years.

In addition, the government wants the country to be self-sufficient in vegetable production, especially after the food crisis a few years ago. As a result, the demand for nitrogen fertilizers, such as urea, is expected to increase in the coming years.

Competitive landscape

The fertilizer market in Saudi Arabia is moderately consolidated in nature, with major players accounting for 53.2% of the market share. Saudi Basic Industries Corporation (SABIC), Maaden phosphate Co., Arabian Agricultural Services Co. (ARASCO), Saudi United Fertilizer Co. (Al-Asmida) and Saf Sulfur Company are the major players in the fertilizer market in Saudi Arabia.

The domestic and international players in the market are focusing on strategies such as increasing investment in research and development, product launches, expansions and partnerships to improve their market share in the region.

Companies cited

  • Maaden Phosphate Co.

  • Saudi Society for Basic Industries (SABIC)

  • Al-Jubail Fertilizer Company (AlBayroni)

  • Al-Tayseer Chemical Industry

  • Jas Global Industries

  • Arabian Agricultural Services Co. (ARASCO)

  • Saudi United Fertilizer Company (AlAsmida)

  • Takamul National Agriculture

  • Saf Sulfur Company

For more information on this report, visit https://www.researchandmarkets.com/r/2nev32

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