Nitric acid: Cycles
No public price, so watch ammonia and gas
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.Nitric acid has no public price; it is valued at ammonia cost plus conversion and moves with ammonia and gas. The economics show up in AN and CAN prices and in the margins of Yara, CF and the explosives makers. Peaks came when gas spiked (Europe 2021-22) or when ammonia supply was cut (the 2026 Hormuz near-closure). Troughs come with weak farm incomes and cheap gas. The floor is cash cost at the cheapest gas-based sites; the ceiling is set by switching to urea or by demand destruction in mining and farming.
The spread to watch AN or CAN price minus ammonia costAbout 0.43 t NH3 per t AN, half of it through nitric acid and half added in neutralisation (stoichiometry); the spread pays for conversion and N2O compliance. Recent levels not published.
Booms and busts
- 2008
Commodity boom and high gas prices pushed nitrogen prices to records, then the financial crisis cut demand.
Nitric acid prices not published; ammonia and AN moved together (indicative)
- 2021-2022
European gas prices rose several-fold; Yara and others curtailed ammonia and nitric acid in Europe and imported ammonia. The war in Ukraine cut Russian supply.
Tampa ammonia contract peaked at about $1,625/t in April 2022 (indicative, Argus/industry reporting)
- 2026
The Hormuz near-closure and Gulf supply loss tightened ammonia; Indian buyers faced sharply higher costs.
Ammonia delivered to Indian ports up almost 41% at the midpoint between January and April 2026 (Argus)
What drives the cycle
- Natural gas and ammonia prices. Ammonia is most of the cost; European TTF and Middle East supply decide marginal cost.
- Farm economics and nitrate demand. AN and CAN demand follows grain prices and European and Brazilian application rates.
- Mining activity. Technical AN tracks coal, iron ore, copper and gold output.
- Carbon rules for N2O. EU ETS coverage and carbon credits decide whether abatement pays; CBAM covers fertilisers.
- AN safety regulation. Rules after Beirut (2020) and earlier accidents raise storage and transport costs.
Metrics to track
| Metric | Why it matters | Where to track it |
|---|---|---|
| Ammonia prices (Tampa, NW Europe, Middle East, CFR India) | Main cost driver | Argus; CRU; Profercy |
| AN and CAN prices (Europe, Brazil) | Main product value | Argus; CRU |
| TTF gas price | European marginal cost | ICE Endex |
| N2O credit issuance and prices | Value of abatement | Verra, Gold Standard, Calyx Global |