Fertilisers
KSA’s close proximity to growing Asian markets, efficient export operations and an increase in production mean it’s ready to capture increased share of the global fertilizer market.
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Experiencing strong growth rates
A key player in the global fertilizer market since the late 1960s, Saudi Arabia provides an excellent platform to capture global opportunities in the fertilizer market due to the local availability of critical inputs to fertilizer production. In addition to natural gas, Saudi Arabia enjoys extensive supplies of indigenous phosphate rock and sulfur.
Current global consumption of nitrogen, potash and phosphate-based fertilizer stands at approximately 154 million tons, having grown from 2.5 to 5.0% annually since 2000. Strong growth rates are expected to continue in response to the global rise in the price of many grain crops. At the same time, the geographic mix of fertilizer demand is expected to shift towards Asia’s booming markets. Saudi Arabia is well positioned to provide a secure, low-cost, supply of fertilizers to this growing market because of the low-cost energy supplies and strategic geo-logistics solutions that it offers.
Low priced gas means competitive advantage
For nitrogenous fertilizer producers, the availability of low-priced natural gas in Saudi is a critical source of competitive advantage, as feedstock can contribute up to 90% of total production costs. Phosphate-based fertilizer production is set to expand rapidly in KSA as a new Diammonium Phosphate (DAP) complex comes online at Ras Az Zawr, which will begin processing some of the country’s 3.1 billion tons of phosphate deposits.
Good reasons to invest
- Local natural gas feedstock is available at competitive rates enabling attractive project economics
- World-class phosphate deposits in the northern and northwest regions of KSA (at Al-Jalamid and Umm Wu’al)
- Highly competitive elemental sulfur from the growing refining sector
- Strategic location, with excellent access to Asia’s vast fertilizer market supported by WTO membership
- Strong global demand trends
- Availability of sulfuric acid, phosphoric acid and potash will enable downstream opportunities