Urea Market Size and Share Analysis - Growth Trends and Forecast Report 2025-2033

Urea Market Insights

Urea, also called carbamide, is a nitrogenous organic compound whose chemical formula is CO(NH₂)₂. It is a white crystalline solid that is highly soluble in water and plays a key role in the nitrogen cycle. Urea is produced naturally in the human as well as animals' livers as a by-product of protein metabolism and industrially through chemical processes using ammonia and carbon dioxide.

Urea is primarily used as a nitrogen-rich fertilizer in agriculture, making it a crucial component for enhancing soil fertility and boosting crop yields. Its high nitrogen content helps plants grow faster and healthier. Beyond agriculture, urea is used to manufacture plastics, resins, and adhesives. It also finds applications in cosmetics, where it acts as a moisturizing agent. In the automobile world, urea solutions such as AdBlue prevent nitrate from exhausting in diesel engines. Moreover, it is used in pharmaceutical formulations and as a feed additive in livestock nutrition.

Global Urea Market Growth Drivers

Rising demand for fertilizer in agricultural activities

It has been observed that increased demand for fertilizer in agricultural activities is the primary consumer in the agricultural sector. Mainly, this is due to the need to increase crop yields and fulfill the rising global food requirement. As the world’s population continues to grow at an unprecedented rate, the pressure on arable land to produce more significant quantities of nutritious food has intensified dramatically. Urea, renowned for its high nitrogen content, is not merely a fertilizer but a vital ingredient that fosters robust plant growth and resilience. This dynamic landscape is further propelled by emerging economies, where agricultural activities are rapidly expanding, significantly amplifying the demand for urea and consequently invigorating the global market. In March 2023, Yara International will invest USD 1 billion in a new urea plant in Brazil, set to start operations by 2025, with an annual production capacity of 3.6 million tonnes.

Expanding Use in Industrial Applications

Urea is a versatile compound with diverse industrial applications, making it a crucial player in modern manufacturing processes. It is prominently utilized in the production of plastics, adhesives, and resins, contributing to the creation of everyday products that are both durable and efficient. Urea has a very important role to play in environmental protection, mainly within the automotive industry through incorporation within urea-based solutions like AdBlue, significantly reducing the emission of nitrogen oxides from diesel engines, which is crucial to comply with tough environmental regulations and minimize air pollution. As industries increasingly prioritize sustainable practices and regulatory compliance, the demand for urea continues to grow, propelling the expansion of the urea market across various regions. In May 2024, IMI is launching its first control valve for urea plants to be installed at a major fertilizer plant in the MEA region.

Government Support and Subsidies

A number of developing countries also base their central role in enhancing agricultural productivity on the provision of subsidies for the production and supply of urea fertilizers. These subventions help local farmers reduce the price of urea, making it cheaper and convenient to use and thus securing food even for a growing population. Thus, demand in the market for urea fertilizers remains on the rise. Sustainable agriculture policies are also becoming increasingly popular, which further increases the demand for urea fertilizers. India aims to halt urea imports by the end of 2025 by reviving closed plants and promoting alternative fertilizers like nano liquid urea. Domestic production capacity has grown to 310 lakh tonnes, with a target of 325 lakh tonnes annually. The Government is also providing subsidies to ensure affordable fertilizers for farmers and encouraging the use of nano-liquid urea.

Challenges in the Global Urea Market

Volatility in Raw Material Prices

Urea production relies heavily on raw materials like ammonia and natural gas, the prices of which are subject to significant volatility. Fluctuations in energy costs and supply chain disruptions can directly impact urea manufacturers' profitability and pricing strategies, posing a challenge to market growth.

Environmental Concerns

Excessive use of urea in agriculture can lead to environmental issues, such as soil acidification, water pollution, and greenhouse gas emissions. These concerns have prompted stricter regulations on chemical fertilizers, encouraging the adoption of alternative, eco-friendly solutions. This shift poses a challenge to the traditional urea market.

Fertilizer Urea Market

The urea fertilizer market stands at the forefront of the global urea industry, primarily due to its remarkable efficiency in delivering essential nitrogen to various crops. This versatile fertilizer is extensively utilized across cereal crops and fruits and vegetables, significantly enhancing agricultural productivity. Market growth momentum is further fueled by the rising adoption of urea fertilizers in emerging economies, where burgeoning agricultural sectors strive to meet increasing food demand. Innovative advancements such as slow-release urea fertilizers are emerging, providing even more significant benefits by promoting sustained nutrient availability to plants and optimizing crop yields.

Feed Grade Urea Market

Feed-grade urea is a vital additive in livestock nutrition, offering a highly economical non-protein nitrogen source. Its significance is especially pronounced in the diets of ruminants, where specialized microbes residing in their complex stomachs effectively transform urea into usable proteins. As the global appetite for meat and dairy products surges, using feed-grade urea in animal husbandry is becoming increasingly prevalent. This versatile ingredient enhances the nutritional profile of livestock feed and contributes to animal farming practices' overall efficiency and productivity.

Agriculture Urea Market

The agriculture urea market is witnessing a robust expansion, mainly due to its essential function in contemporary agricultural practices. Urea stands out for its remarkable efficiency and cost-effectiveness, making it a favored choice among farmers looking to boost soil fertility. As global concerns about food security intensify, the demand for increased agricultural productivity is becoming vital, particularly in Asia-Pacific and Africa. These areas are experiencing significant pressures to improve crop yields and sustain their growing populations, further propelling the need for high-quality fertilizers like urea. The versatility of urea in various farming methodologies only adds to its importance in ensuring a sustainable food supply for the future.

Animal Feed Urea Market

The animal feed urea market plays a crucial role in meeting the nutritional requirements of livestock, particularly in regions where high-protein feed is scarce. By offering a valuable alternative source of nitrogen, urea not only helps to lower feed costs for farmers but also promotes optimal growth and health in livestock. Additionally, as the industry shifts towards more sustainable animal farming practices, the demand for urea as a cost-effective nutrient supplement is anticipated to rise significantly, further bolstering this market segment. This trend represents an increase in the intent to improve the welfare of animals while remaining economically feasible for the producers.

Chemical Synthesis Urea Market

The chemical synthesis urea market is significantly involved in other industries, as it is notably used in resins, adhesives, and pharmaceutical manufacturing. Urea is a fundamental component in melamine and urea-formaldehyde resin synthesis, which is highly valued due to its toughness and flexibility for construction and furniture making. With increased demand for high-performance materials throughout the industrial spectrum, the urge for urea is becoming more pronounced. Also, continual technological development significantly raises efficiency in production and broadens the scope for using this versatile compound, contributing to growth and innovation in this emerging sector.

United States Urea Market

The United States urea market is characterized by strong agricultural and industrial demand. In agriculture, urea is an essential fertilizer for food production and enhances crop yields through advanced farming techniques. This reliance on urea underscores its status as a staple in modern agricultural practices. Meanwhile, in the industrial realm, urea's versatility extends to applications such as diesel exhaust fluid (DEF), which is crucial for meeting environmental regulations in the transportation sector. This dual demand from agriculture and industry not only sustains but also propels the growth of the urea market across the nation. May 2024, BASF now offers its first biomass-balanced (BMB) ammonia and urea products, including ammonia anhydrous BMBcertTM, ammonia solution 24.5% BMBcertTM, urea prills BMBcertTM, urea solution 40% BMBcertTM, and urea solution 45% BMBcertTM.

France Urea Market

France's urea market is significantly influenced by its thriving agricultural sector, renowned for its commitment to high-quality crop production. The nation's stringent environmental regulations play a pivotal role in shaping urea usage, as they promote sustainable farming practices that encourage farmers to use urea fertilizers judiciously and responsibly. This careful approach not only ensures healthy yields but also preserves the integrity of the ecosystem. Besides agricultural uses, the industrial utilization of urea is also experiencing growth, primarily in the resin and advanced solutions for emissions. May 2024, FertigHy has selected Northern France as its location for its first low-carbon fertilizer factory, which is scheduled to commence in 2030. Based in the Hauts-de-France region, the factory will have a nitrogen product capacity of 500,000 MT per year, encompassing ammonium nitrate and ammonia.

Indian Urea Market

India boasts one of the largest urea markets in the world, a testament to its vital role in agriculture, which is heavily supported by generous government subsidies. The nation’s burgeoning population and the escalating demand for food grains necessitate the widespread application of urea fertilizers, making them a cornerstone of agricultural productivity. Additionally, efforts to modernize farming techniques and enhance the efficiency of fertilizer use are driving significant advancements in the market, positioning it for continued growth and sustainability. DEC 2024, Under the New Investment Policy (NIP), six new urea units with a production capacity of 12.7 Lakh MT each have been established to boost investment in the urea sector and enhance self-sufficiency in India. Additionally, the revival of the Talcher unit through a Joint Venture with Talcher Fertilizers Limited has been approved, including a new Greenfield urea plant with a capacity of 12.7 LMTPA using coal gasification. The New Urea Policy (NUP) – 2015 was also implemented for 25 existing gas-based urea units to maximize indigenous production. These initiatives have increased urea production from 225 LMT LMT in 2014-15 to a record 314.09 LMT in 2023-24.

Saudi Arabia Urea Market

Saudi Arabia's urea market is significantly enhanced by the nation's rich deposits of natural gas, which serve as a vital raw material for urea production. This burgeoning market is primarily fueled by robust exports, alongside increasing domestic demand driven by the agricultural and industrial sectors. In addition, proactive government initiatives for diversifying the economy and further strengthening the agricultural sector are expected to drive the urea market to new heights, creating a more sustainable and resilient economic landscape. July 2024 SABIC Agri-Nutrients Company received approval from the Ministry of Energy to allocate feedstock for its sixth plant in Jubail Industrial City, Saudi Arabia. The plant will produce 1.2 MMTA of low carbon Blue Ammonia and 1.1 MMTA of Urea and specialized Agri-Nutrients.

Urea Market Segments

Type – Market breakup in 3 viewpoints:

1. Technical Grade
2. Fertilizer Grade
3. Feed Grade Urea

Application – Market breakup in 4 viewpoints:

1. Agriculture
2. Chemical Synthesis
3. Animal Feed
4. Others

Countries – Market breakup in 25 Countries:

North America

1. United States
2. Canada

Europe

1. France
2. Germany
3. Italy
4. Spain
5. United Kingdom
6. Belgium
7. Netherlands
8. Turkey

Asia Pacific

1. China
2. Japan
3. India
4. Australia
5. South Korea
6. Thailand
7. Malaysia
8. Indonesia
9. New Zealand

Latin America

1. Brazil
2. Mexico
3. Argentina

Middle East & Africa

1. South Africa
2. Saudi Arabia
3. UAE

All the Key players have been covered from 5 Viewpoints:

• Overview
• Key Persons
• Recent Development & Strategies
• Product Portfolio
• Financial Insights

Company Analysis

1. BASF SE
2. Petrobras
3. SABIC
4. Bunge Limited
5. Nutrien Ltd.
6. Sasol
7. CF Industries Holdings, Inc.

Report Details: