Viewpoint: Latam looks at domestic markets to spur H2

Spanish Market: Fertilizers, Hydrogen
30/12/25

Latin American countries are assessing ways to promote domestic use of clean hydrogen as international demand fails to materialise.

In line with the global mood, Latin America's hydrogen sector saw modest progress in 2025. But the past year has not brought the long-awaited first final investment decisions (FID), with lack of international demand one of the main culprits for sluggish project development.

While Latin America still has export ambitions, the realisation that demand in Europe and east Asia will not materialise at the scale at which it was once anticipated has prompted countries to re-evaluate their strategies and shift focus towards fostering a domestic market. Some governments are now giving hydrogen a more defined role in their decarbonisation plans.

Chile launched a $2.8bn tax credit scheme for domestic consumption of renewable hydrogen and derivatives in August, targeting the maritime and mining sectors. Applications for the first tranche of the tax benefits, with a budget of $700mn, are expected to open in early 2026. Although projects targeting exports will not benefit directly, the initiative is likely to support the industry as a whole. The programme will help reduce project risk and enable economies of scale, developers said.

Brazil is also targeting hydrogen for domestic uses. The government is yet to finalise the rules of its own $3bn tax credit scheme, but the programme's law established that the benefit should prioritise projects with higher potential for national decarbonisation. Brazil would do well to take a leaf out of Chile's book — Brazil's large agricultural sector relies heavily on fertiliser imports and could offer significant demand for locally produced green fertilisers.

Colombia recently unveiled a comprehensive action plan with initiatives to be implemented by 2030. The country's hydrogen strategy, first launched in 2021, needed to be revised to adapt to the current market realities, the government said. The new plan pays special attention to fostering a domestic market through potential introduction of mandates for use of renewable hydrogen for production of green fertilisers and in the mobility sector.

It might be still too early to say to what extent these policy changes will help project development, and it is unclear whether other Latin American countries will follow. But fostering a domestic market, even a limited one, has been one of the most effective ways to launch the first projects. One of the region's most advanced projects, Atome's green fertiliser project in Paraguay has successfully secured several financing deals and 100pc offtake by targeting demand in the Mercosur countries.

Milestones

Some of these countries could reach important project milestones in 2026 as they start to clear obstacles such as permitting and infrastructure bottlenecks. Brazil's energy ministry recently approved two tenders in 2026 to expand the power grid, a move that could help address industry concerns about infrastructure.

Chile's recent environmental approval of projects in Antofagasta and Magallanes will probably accelerate the development of key projects. Clearing permitting is one of the most lengthy stages of project development, companies have often said.

Some firms aim to take FID in 2026, including a few of Brazil's flagship projects. But developers have often pushed back project timelines, and securing long-term offtake remains the main challenge for projects worldwide.

Although the market is developing slowly, long-term prospects for competitive renewable hydrogen production in the region remain promising, according to industry participants. US electrolyser manufacturer Electric Hydrogen recently expanded its operations into Brazil, its first entry into Latin America. The region offers "one of the most compelling economic cases" for large-scale hydrogen and derivatives projects, the firm said.

Latin America's close relationship to China could also benefit the local industry. Chinese developer Envision could leverage its expertise as the operator of one of the largest renewable ammonia projects globally to its planned project in Brazil's Pecem complex.

By Pamela Machado

Related news posts

Argus illuminates the markets by putting a lens on the areas that matter most to you. The market news and commentary we publish reveals vital insights that enable you to make stronger, well-informed decisions. Explore a selection of news stories related to this one.

30/12/25

Viewpoint: Brazil freight rates rise on record soy crop

Sao Paulo, 30 December (Argus) — Road freight rates for grains and fertilizers may rise in 2026, as a record 2025-26 soybean crop boosts trucking demand in the first quarter, with many areas being harvested simultaneously. Brazil's grain freight rates remained high during 2025, with record soybean and corn production throughout the 2024-25 cycle, contributing to above-average freight rates compared to 2024. On the Sorriso-Miritituba stretch, freight rates averaged around 12pc above 2024 levels, while on the Rondonopolis-Santos route the increase was around 6pc. Freight rates are also likely to rise as fertilizers are transported for the second 2025-26 corn crop in May. In the export market, especially for soybeans, trade tensions between China and the US led the Asian country to turn to Brazilian oilseeds to meet demand. This extended Brazil's export window and resulted in constant demand for road transport services. For 2026, with Brazil likely to see record-high soybean output in the 2025-26 cycle, greater demand for transportation services in export corridors is expected, which may also result in higher freight rates. National supply company Conab projects that Brazil will produce 177.6mn metric tonnes (t) of soybeans in the 2025-26 cycle, an increase of almost 3.6pc compared to the previous season and the largest on record, according to the second official estimate for the cycle. Central-western Mato Grosso state — Brazil's largest producer — could harvest 47.2mn t of soybeans in the 2025-26 cycle, according to the state's institute of agricultural economics (Imea). That would be 7.3pc behind 2024-25 production, but still the second largest in the state's history. Overall, the planting pace for the 2025-26 cycle proceeded without major problems. Planting registered a surge in progress throughout October. In the first four weeks of planting, planting reached 21.2pc of the nearly 13mn hectares (ha) expected for the cycle by 10 October. However, planting advanced by 54.9 percentage points across the month, totaling 76.1pc by 31 October. More than half of Mato Grosso's soybean area was planted during the same period. This raises concerns among market participants about high competition for transportation in export corridors and availability of vehicles, resulting in a logistical bottleneck, since the harvest of these areas must also occur at the same time. Climate issues remain on the radar. Accumulated rainfall in Mato Grosso during November reduced water stress and favored crop development. But rainfall remained irregular in other regions, a situation that could harm the state's productivity. This could also affect the corn planting window and its harvest in the second half of 2026. Although Brazil expects significant corn production, the domestic market has been absorbing most of the grain volume, exceeding exports. This should result in lower grain freight rates during this period, with a good portion being destined to meet the needs of Brazilian industry. Corn ethanol production in Brazil is expected to total 8.7bn litres (l) in the 2025-26 cycle, an increase of 11pc compared to the 7.8bn l produced in the previous cycle. Conab projects that 1t of corn can produce around 400l of ethanol, which means that approximately 21.8mn t of corn will be consumed by the ethanol industry, up from 18mn t a year prior. Fertilizer freight rates likely to rise Fertilizer transportation may also face logistical bottlenecks while moving inputs from ports inland due to the slow pace of fertilizer purchases, especially nitrogen fertilizers, for the second 2025-26 corn crop. The national land transport agency's (ANTT) minimum freight rate table also adds challenges to the logistics market. Since October, compliance with the minimum freight rate is monitored automatically, based on information entered in a mandatory electronic tax manifest (MDF-e) issued by the party that hires the truck driver, such as carriers. This gathers information from several invoices related to the cargo transport, facilitating tax inspection and logistics management. The system cross-checks data declared in the MDF-e with the official minimum freight rate table. If the reported value is below the legal limit, the system will identify the irregularity without requiring an additional report or inspection. The new automatic compliance system led to increases in fertilizers road freight rates of up to 70pc on some of the 31 routes monitored weekly by Argus . Subsequently, freight rates decreased slightly during the year, with some carriers disregarding the table and reducing profit margins in a bid to offer competitive prices. In addition, demand for vehicles with a greater number of axles has skyrocketed. Under the new regulations, seven-axle trucks are deemed less efficient and cost-effective than nine-axle trucks, the supply of which is more limited. Deliveries of nitrogen-based fertilizers, especially urea and ammonium sulphate (AS), will likely increase competition for vehicles in the first quarter of 2026, especially in January, when the supply of trucks is reduced due to drivers heading home for end-of-year festivities. Under these circumstances, higher fertilizer freight rates and higher costs for road logistics are expected. Brazilian importers have been exchanging urea for AS, which offered during most of 2025 a more attractive nitrogen price. However, twice the volume of AS is required compared to urea for an equivalent amount of nitrogen, as urea has 46pc nitrogen and AS has 21pc, which adds to logistical and operational costs. The availability of sufficient trucks has been a concern this year, hindering inland transport. ANTT's new electronic inspection system of minimum freight rate table, in effect since October, remains an important market driver and resulted in a significant increase in road logistics costs. But this matter is surrounded by legal uncertainty as a state court decision suspending fines in some regions has not curbed the growing number of carriers ignoring the minimum freight rate table. However, most carriers continue to comply to avoid penalties. Fertilizer companies remain reluctant to absorb the rate increases imposed by the table. In this context, the situation would only be resolved with a ruling from Brazil's Supreme Court on the constitutionality of the issue. But market participants believe it is unlikely that the issue will be resolved in 2026, as it is unpopular and affects an important sector for the country in a year of federal elections. By João Petrini Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Viewpoint: Sulfur costs to support amsul prices in 2026

30/12/25

Viewpoint: Sulfur costs to support amsul prices in 2026

Houston, 30 December (Argus) — Ammonium sulfate prices appear primed to rise in the first half of 2026, supported by rising feedstock costs and tight global supply. Persistent supply constraints in Europe coupled with elevated feedstock costs are adding upward pressure on amsul prices that is unlikely to ease soon. Ammonia and sulfur, key inputs for amsul production, are hovering near multi-year highs. Buyers and sellers project the first-quarter Tampa sulfur contract to rise to $475-520/long tonne (lt) delivered, from $310/lt del, which could increase amsul production costs by roughly $40-50/st or more depending on the grade. Initial fourth-quarter domestic amsul offers in the US Corn Belt were about $20-25/st higher than the same period last year. Some producers, who held back on releasing offers, are now quoting prices roughly $40-50/st above last year's initial fourth-quarter offer levels. At the same time, ammonia prices are up about $90/t cfr year over year, and sulfur costs have surged by nearly $194/lt del. The increase in amsul offers sparked more buying as customers sought to secure product ahead of further price hikes anticipated in the first quarter of 2026. Major amsul producer IOC shut down operations due to surging feedstock costs but restarted production earlier this month. Similar pressures could affect domestic caprolactam producers as high sulfur costs ripple through the nylon value chain. Sulfuric acid is a critical input for caprolactam, and with margins already thin, further cost inflation could prompt producers to adjust operating rates. The US tariff exemptions on amsul , among most other fertilizers, announced in early November had little impact on prices because European producers faced tight granular supply and could not ramp up exports even though economics to the US have improved. The US imported around 1.2mn t of amsul in the 2024-25 fertilizer year, with around 48pc of total imports coming from the European Union, according to the US Census Bureau. Low caprolactam margins in the EU made amsul production less profitable, compounded by planned and unplanned outages, while Chinese material rapidly gained share in Europe's domestic market. However, carbon border adjustment mechanism (CBAM) costs could slow Chinese imports into Europe, giving regional producers a chance to regain domestic market share. On ammonia, another key feedstock for certain amsul producers like IOC and Martin Resources in the US, the January Tampa contract settled at $585/t cfr. Most US ammonia prices eased after fall applications dwindled. Still, ammonia could remain tight due to production outages in the third and fourth quarters that left some producers struggling to meet commitments as demand for applications spike in the first half of November. Affordability remains front of mind as growers navigate high input costs and narrow crop margins from the past fertilizer season, prompting a cautious and risk-averse approach to fertilizer purchases. President Donald Trump's farmer aid package eased some financial pressures on growers and has supported more fertilizer spending, especially with the US Department of Agriculture projecting strong corn acreage for the coming season. Market participants attest that feedstock volatility and supply constraints continue to shape the amsul market going into 2026. As spring demand returns, offers are expected to incorporate higher production costs from elevated sulfur prices, paving the way for bullishness in the amsul market headed into the new year. By Sneha Kumar Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Viewpoint: CBAM could draw nitrogen exports from the US

29/12/25

Viewpoint: CBAM could draw nitrogen exports from the US

Houston, 29 December (Argus) — US nitrogen producer CF Industries will have greater incentive to export nitrogen products to the EU once the Carbon Border Adjustment Mechanism (CBAM) comes into effect in 2026. The degree to which CF can capitalize on CBAM is still unknown, but the company has expressed a desire to do so. "Based on our conversation with customers, we also believe CBAM will drive significant demand for other low-carbon nitrogen products, such as UAN," said Bert Frost, CF executive vice president of sales. "We feel very confident in our competitive position," he added. The EU revised the default CBAM emissions value for US ammonia to 3.41 metric tonnes (t) of CO2 equivalent (CO2e), up from 2t of CO2e, according to preliminary documents, to the confusion of many traders across nitrogen markets. The new US default emissions values are based on ammonia produced using petroleum coke as a feedstock rather than natural gas like most nitrogen plants in the US. CBAM has assigned countries punitive default emissions values to motivate producers to verify their individual emissions with CBAM. In addition to using natural gas, CF's Donaldsonville facility in Louisiana, the largest nitrogen plant in the world, can capture its emissions for enhanced oil recovery and will sequester its carbon once its partner ExxonMobil acquires a class VI permit. If CF can successfully reduce its emissions at Donaldsonville and verify them with the EU, the carbon price paid by EU importers for nitrogen products from the plant would be much lower than the emissions tax paid when importing from other origins . That could create new export markets for the US producer across the EU, potentially tightening nitrogen markets throughout North America and altering global trade flows. Importers of urea from Algeria, Nigeria and Egypt into the EU would pay $52-57/t ($47-52/st) under CBAM in 2026, based on the 29 December EU ETS prompt price of $100.26/t. Donaldsonville would only have to verify a urea emission value 62pc below the default value of 2.31t of CO2e — also based on a petroleum coke feedstock — to bring the carbon charge paid by an EU buyer to zero, based on Argus calculations. Donaldsonville's competitive advantage could provide CF with an outlet for its nitrogen fertilizers during the summer and fall off-season or allow the producer to pit US buyers against the EU when US markets get more active. Similar to urea, CF would have to bring its default emission values for UAN down by 65pc from 1.76/t of CO2e to bring the carbon charge paid by importers to zero for 2026. The default carbon charge paid by importers of UAN from Trinidad & Tobago and Russia ranges from $82-104/t ($74-94/st). But again, producers in other countries may also verify carbon emissions lower than the default CBAM values. Ammonium nitrate has the highest carbon price associated with it under CBAM on a per unit nitrogen basis compared with urea and ammonia because of the carbon intensity of nitric acid production. Therefore UAN — in which nitrate is a primary feedstock — from Donaldsonville will have the largest competitive advantage of the facilities' products under CBAM. The Louisiana plant does not produce granular nitrate. How much urea or UAN CF can export will depend on how much ammonia it will have leftover for upgrades. CF says it can sequester 2mn t/yr of CO2e in its partnership with ExxonMobil and produce 1.9mn t/yr of "low carbon ammonia" from its Donaldsonville plant. That would account for half of Donaldsonville's gross ammonia capacity of 3.84mn t/yr. But the carbon intensity of its "low carbon ammonia" has not been disclosed, making it difficult to calculate the facilities' exact competitive advantage over other exporters to the EU. CF did not respond to requests for comment on the emissions from Donaldsonville ammonia and upgrades, or the "low-carbon ammonia" it plans to manufacture. CF shipped its first cargo of blue ammonia to Europe in October as part of a contract. The cargo had a "significantly lower well-to-gate carbon footprint than conventional natural gas-based ammonia production", the company said. CF reported its scope 1 emissions per metric tonne of ammonia at 2.11t of CO2e for 2024 across its facilities, already much lower than the default 3.41t. But that number includes emissions from upgrade units for urea and nitric acid, among others, meaning CF's emissions from a ton of ammonia before carbon capture were lower than 2.11t. CF also already has N2O abatement technology installed at a third of its nitrate units across its production sites, the company said. By Calder Jett Theoretical CBAM default charges for urea and UAN CBAM default emissions value t CO2e/t product Projected CBAM default charge $/t * CBAM default charge per tonne of nitrogen $ ** Urea (46pc nitrogen) US 2.3129 $143.72 $3.12 Egypt 1.4039 $52.58 $1.14 Algeria 1.4241 $54.61 $1.19 UAN (30pc nitrogen) US 1.7574 $115.10 $3.84 Russia 1.6463 $103.96 $3.47 Trinidad & Tobago 1.4342 $82.70 $2.76 *based on ETS prompt price of $100.26/t on 29 December; **nitrogen content of products can vary depending on plant — European Commission documents, Argus prices, Argus calculations Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Viewpoint: US phosphate market torn on spring demand

29/12/25

Viewpoint: US phosphate market torn on spring demand

Houston, 29 December (Argus) — US phosphate market participants have mixed opinions on how much spring grower demand to expect following a lackluster fall, even as affordability improves and projections for next spring's corn planting remain over 90mn acres. DAP and MAP prices this year at the New Orleans, Louisiana, port and further inland were well above year-earlier levels after import tariffs deterred offshore suppliers. Higher prices, supported by a steep drop in imports, led to most domestic growers significantly minimizing their phosphate purchases and applications this fall. But as the near-term price outlook begins to soften with the anticipated arrival of fresh imports early next year, traders still seem skeptical of how much spring demand there will be. Nola DAP prices in 2025 averaged $690/st fob, $128/st higher than the 2024 average price, while MAP prices at the port averaged $688/st for the same period, $78/st higher than the year-earlier average price. DAP and MAP imports into the US for July through September totaled 159,000t, down by 71pc from the same period in 2024 and 69pc lower than the five year average, according to data from the US Census Bureau. But including additional October-December vessel information, imports could total roughly 493,000t, according to Argus estimates, only 51pc lower than a year earlier. It there was 20pc demand destruction in the fall that left large volumes of phosphate in warehouses, the US supply outlook may be higher than initially expected heading into spring, according to a trader. Still, traders over recent months have expressed mixed expectations for spring demand, including headwinds such as increasing phosphate production costs and unfavorable affordability fundamentals . With the surprise removal of US import tariffs on phosphate in November, offshore suppliers were quick to line up vessels for winter delivery that would ease spring supply concerns and better balance US supply-demand fundamentals. As a result, Nola DAP and MAP prices dropped, with DAP at $616/st fob Nola and MAP at $617.50/st fob for the week ended 18 December. With another round of spring planting just around the corner, growers will need to make up for phosphate applications that were skipped in the fall. Just last month, the US Department of Agriculture forecast that roughly 95mn acres of corn will be planted this spring, down from 98.7mn acres in 2025 but still ahead of 91.5mn acres in 2024. There was slackened fall demand, but it seems a new page flip is inevitable in 2026, according to Itafos president David Delaney. US market wary of global supply tightness The recent downward pressure that has taken hold in the phosphate market could be tempered by a strained global supply outlook and elevated feedstock costs. Phosphate producers will often scale back marginal production in the face of higher variable costs, like sulfur and ammonia, if margins are compressed. In mid-December, North American fertilizer producer Mosaic announced it will idle SSP production in Brazil because of increasing sulfur prices, just days after the global market caught wind of China's intention to not export certain phosphate products until August 2026, also a result of elevated sulfur costs as well as domestic supply concerns. These actions, though occurring outside of the US, tighten the global supply outlook for the first half of 2026. This would be a key period for US traders to secure phosphate for customers who deferred applications from the fall to the spring, but it could occur amid rising global demand that would boost competition for phosphate volumes. Rising costs alongside elevated ammonia prices also increase the likelihood that Mosaic or Canadian fertilizer producer Nutrien could trim domestic phosphate output early next year. Nutrien is already conducting a strategic review of its phosphate assets expected to be ready in 2026. And a lack of Chinese exports coupled with higher production costs could keep phosphate prices elevated, potentially causing US grower demand to be lower than the previous spring or below-average, even as they need to replenish soil nutrients. By Taylor Zavala Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Woodside achieves first ammonia output at Texas plant

29/12/25

Woodside achieves first ammonia output at Texas plant

Singapore, 29 December (Argus) — Australian independent Woodside Energy's 1.1mn t/yr ammonia plant in Beaumont, Texas, has produced its first ammonia, marking the first phase of operations and the commissioning of the facility, according to a press release issued today. The plant is expected to begin commercial ammonia output in early 2026. Production of low-carbon ammonia is scheduled to begin in the second half of the year. Deliveries of conventional ammonia to contracted buyers are expected to start next year, while agreements for low-carbon ammonia sales remain under negotiation. The commissioning and systems testing demonstrate the plant's production readiness and progress towards commercial startup, Woodside vice president of Beaumont New Ammonia Kellyanne Lochan said. US corn acreage is expected to remain historically high in spring 2026 and the startup of commercial output at the Beaumont plant may help meet domestic demand in the US Gulf coast and limit price rises . By Dinise Chng Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Argus Brazil Grains and Fertilizer

Cobertura analítica y detallada del mercado de cereales y fertilizantes de Brasil

Argus Carbon

Benchmarks de precios del carbono, noticias sobre políticas y proyectos, y análisis exhaustivos, a diario.

Informe Argus Low Carbon Hydrogen Strategy

Tercera parte: América del Norte Un análisis en profundidad de los sectores, países y políticas claves que permiten el crecimiento del hidrógeno.

Argus Hydrogen and Future Fuels

El punto de vista global sobre el hidrógeno y los mercados de productos derivados.

Argus Nitrogen

Evaluaciones del precio diarias y semanales, tendencias comerciales, comentarios del mercado, datos actuales e históricos claves.

Business intelligence reports

Get concise, trustworthy and unbiased analysis of the latest trends and developments in oil and energy markets. These reports are specially created for decision makers who don’t have time to track markets day-by-day, minute-by-minute.

Learn more