Urea Demand, Production Capacity, Volume and Price Range and Industry Outlook Report Till 2034

Urea, also called carbamide, is a white, crystal-like substance made from carbonic acid. It is produced by combining carbon dioxide with ammonia and is then turned into small pellets or granules for use. Urea is not only made in factories but is also naturally produced in the bodies of mammals during the breakdown of proteins.

In farming, urea is mainly used as a fertilizer because it provides nitrogen, an essential nutrient for plant growth. It also serves as a protein supplement in animal feed and is used in the production of other materials like resins and diesel exhaust fluids. Urea-formaldehyde compounds, in particular, are valued in agriculture for slowly releasing nitrogen into the soil.

Urea demand, by Application

The global urea market is primarily driven by its widespread use in fertilizers, which accounts for the largest share due to its high nitrogen content essential for crop growth. Melamine production also relies heavily on urea, serving industries such as laminates and plastics. Urea is utilised in animal feeds as a non-protein nitrogen source to advance digestion in ruminants. Other applications include pharmaceuticals, chemical intermediates, and de-icing agents. Growing agricultural demand, expanding industrial uses, and rising livestock farming worldwide continue to fuel the global urea market's growth.

Key Manufacturers

Some of the top global companies involved in urea production include Qatar Fertilizer Company, CF Industries, SABIC, Yara International ASA, Koch Fertilizer LLC, OCI Industries, EuroChem, Hubei Chemical Fertilizer Company, Luxi Chemical Group, Zaklady Azotowe Pulawy SA, and Sichuan Lutianhua.

In 2023, Russia was the leading exporter of urea, sending out about 7,500 kilo tons. China followed with over 5,300 kilo tons. On the other hand, Brazil was the top importer, bringing in more than 7,500 kilo tons of urea during the same year.

Market Dynamics

Rising demand from Agriculture segment

The growing need for food and farming is boosting the demand for urea. It is used widely as a nitrogen-rich fertilizer in countries like the United States, Brazil, and India. Urea helps improve soil health and provides key nutrients that support strong plant growth. Countries with large agricultural sectors, such as China, Japan, India, Korea, and Brazil, are expected to see rising demand for urea in the coming years.

One of the primary drivers of urea demand is the continuous growth of the global agricultural industry. As the world's population increases, the need for crop also increases and farmers mostly rely on nitrogen-rich fertilizers like urea to improve crop yields and meet the growing food demand. Urea helps enhance soil fertility and supports the healthy growth of various crops including wheat, rice, and corn, making it an essential input in modern agriculture.

Shift Towards Organic Farming

However, the increasing interest in organic farming is affecting the use of urea. As urea releases ammonia and carbon dioxide, which can be harmful to health and the environment, more people are choosing chemical-free methods. Organic farming uses natural fertilizers and pest control methods made from plant and animal waste. For instance, India has launched a program called Paramparagat Krishi Vikas Yojna (PKVY) to promote organic farming, which could reduce the use of chemical fertilizers like urea.

Environmental Regulations Limiting Urea Use

Urea production and overuse can harm the environment. It releases pollutants like ammonia, which can make soil acidic, lower its natural fertility, and harm beneficial microbes. Too much urea can also negatively affect seed growth and damage crops due to increased soil toxicity. Some countries in Western Europe have even started banning solid urea fertilizers. Strict environmental rules in many places are expected to limit the future growth of the urea market.