Market Trends of Indonesia Nitric Acid Industry
This section covers the major market trends shaping the Indonesia Nitric Acid Market according to our research experts:
Fertilizer Segment to Dominate the Market
- Nitric acid produces ammonia nitrate, which is further converted into urea ammonium nitrate (UAN) by a particular reaction. Urea ammonium nitrate (UAN) is used as fertilizer, creating a massive demand for nitric acid within the fertilizer industry.
- In Indonesia, urea fertilizer is most produced, followed by triple superphosphate (TSP), ammonium sulfate, and KCI (potassium chloride). Urea fertilizers are most used in Indonesia for food crops, estate (perennial), and horticulture crops. There is a high demand for urea fertilizer within the country, which is met by various exporting countries such as the Philippines, Singapore, India, Japan, and Vietnam, increasing the demand for nitric acid to produce urea fertilizer within the country.
- Ammonium nitrate is a popular and effective nitrogen-based fertilizer that contains around 35% (by mass) of total nitrogen. Furthermore, calcium ammonium nitrate (CAN) fertilizer includes 25-28% nitrogen. CAN fertilizer is used to deliver nitrogen to plants to help them thrive.
- Over half of the world's palm oil is produced in Indonesia, the top producer. The nation exports more than two-thirds of the world's palm oil, making it the largest palm oil exporter in the world. Including refined bleached and deodorized (RBD), crude palm oil (CPO), and palm kernel oil, Indonesia produces and exports a wide range of palm oil-related goods.
- Palm oil trees need a balanced fertilizers strategy to achieve optimum growth and production. According to USDA Foreign Agriculture Service data, Indonesia rapidly expanded its palm oil harvestable area in recent years. In 2022, 12.5 million hectares of palm oil were harvested in Indonesia.
- Therefore, considering the factors mentioned above, the demand for the nitric acid market is expected to rise in the fertilizer industry significantly shortly.
Understand The Key Trends Shaping This Market
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Growth in the Food Industry
- Nitric acid is used for potassium nitrate production, an additive and coloring agent for salted meat during the manufacturing process of preserved foods. In food safety, nitric acid is used to identify the toxic chemical presence chemicals in food products.
- Rise in per-capita income and an increase in middle-class population, Indonesia is the largest economy in Southeast Asia.
- Currently, Indonesia's food market amounts to USD 289.30 billion. The market is expected to grow by over 6% over the next eight years.
- All factors above are likely to fuel the growth of the nitric acid market in Indonesia over the forecast time frame.
