The agribusiness banking specialist says urea is by far the most widely-traded fertiliser in the world and, for Australia, represented nearly half (46 per cent) of total fertiliser imports in 2024.
In the report, What tight urea supplies mean for global prices and Australian farmers, the bank’s RaboResearch division says due to minimal volumes of urea produced domestically, Australia is particularly sensitive to global events.
Report author, RaboResearch farm inputs and commodities analyst Paul Joules, said the urea market is expected to remain volatile due to complex supply chains and geopolitical influences, with prices elevated compared to historical averages.
“Ongoing supply issues in key exporting regions and the sensitive nature of natural gas markets — the predominant feedstock for urea production — suggest that urea prices will likely stay high,” he said.
The RaboResearch report said while the majority of the chief urea-producing regions and countries (Europe, Iran, Egypt and China) that are experiencing supply issues do not directly supply Australia, “they still account for global losses to the supply, which creates a ripple effect for available volumes for Australian importers”.
In 2024, 79 per cent of Australian urea imports came from the UAE, Saudi Arabia, Qatar, Indonesia and Oman.
The report said 3.85 million tonnes of urea was imported into Australia in 2024 (which represents more than 90 per cent of its usage) — making it by far the most imported fertiliser locally.
Mr Joules said two projects, proposed for South Australia and Western Australia, could see local production total 3.3 million tonnes — 0.55 million tonnes behind Australia’s total imported volume of urea in 2024.
However, he said it was unlikely Australia would switch from relying largely on imported product to mainly domestic supplies in the near future.
