Ammonia: Cycles

Gas shocks, war and the Hormuz spike of 2026

What this tab covers How its prices and margins move: past booms and busts with price levels, the spread or margin that the industry watches, the drivers of the cycle and the metrics to track.

Ammonia prices spike when the gas cost floor jumps or export supply is cut, and fall back within one to two years as plants restart. The marginal producer is usually in Europe on imported gas, so TTF sets the floor in tight markets. Ceilings come from demand destruction: farmers cut application and phosphate makers slow runs. The Tampa monthly contract and Middle East FOB are the benchmarks. 2026 brought a Hormuz-driven spike: Tampa rose from about $480/t early in the year to $825/t in May, then fell four months running to $555/t in September (Fertilizer Daily).

The spread to watch Ammonia price minus gas cost

Tampa $555/t (Sep 2026) minus gas cost at 33 MMBtu/t: about +$460/t for a US plant on $2.95/MMBtu Henry Hub (World Bank Sep 2026), about -$280/t for a European plant on $25.42/MMBtu TTF.

Booms and busts

2008
High gas and grain prices with Chinese export taxes, then the financial crisis.
World Bank urea, a proxy for nitrogen, rose to $785/t (Aug 2008) then fell to $240/t (Dec 2008); ammonia series not in the Pink Sheet
2021-2022
European gas rose about tenfold and plants shut; Russia's invasion added sanctions risk.
US Gulf Coast ammonia averaged $578 per short ton (2021) and $1,070 per short ton (2022), then $470 (2023) (USGS)
2026
Shipping through Hormuz largely stopped after the US-Israeli war with Iran began on 28 Feb 2026, cutting Gulf exports. A ceasefire on 8 April and a memorandum on 17 June let some stranded cargoes out, but fighting resumed in July; by October oil flows through the strait were about 82% of pre-war, with renewed attacks and Brent near $110 (Reuters/Kpler). China released urea export quotas in June.
Tampa CFR about $480/t (early 2026), $825/t (May), $720 (Jun), $670 (Jul), $635 (Aug), $555 (Sep) (Fertilizer Daily)

What drives the cycle

Natural gas prices (TTF, Henry Hub, LNG). 72-85% of cost; European gas sets the floor in tight markets.
Export disruptions (Hormuz, Black Sea, sanctions). Gulf, Russia and Trinidad supply most seaborne ammonia; shocks remove supply that cannot be replaced fast.
Phosphate (DAP) production. Morocco and India import ammonia for DAP; their run rates swing merchant demand.
Chinese export policy (urea). Chinese urea quotas change world nitrogen balance and pull ammonia prices with them.
New capacity and closures. Large US Gulf and Middle East plants add supply in blocks; European and Trinidad closures remove it.

Metrics to track

Metric	Why it matters	Where to track it
Tampa ammonia monthly contract	west of Suez benchmark	Argus, CRU, Fertilizer Daily, QCI
TTF and Henry Hub gas	cost floor	World Bank Pink Sheet; ICE; EIA
Middle East FOB ammonia and CFR India	east of Suez price	Argus; CRU; ICIS
US Gulf Coast ammonia price	annual official series	USGS Mineral Commodity Summaries