The ICIS Northwest Europe ammonia-to-hydrogen assessment fell in value for the ninth straight week in mid-April as ammonia pricing continued to slide amid weak demand for the commodity. The ammonia-to-hydrogen northwest Europe assessment fell by another EUR 0.09 per kilogram week on week to EUR 4.6 per kilogram on April 13, down over EUR 2 per kilo on the level seen in late February, ICIS’s Deputy Editor for Hydrogen Gary Hornby wrote in an analysis.
Natural gas-based hydrogen production methods posted similar losses with the European gas hubs easing back down during the week, with the British NBP front-month contract falling back towards the 100 pence per therm mark.
Both front month–based unabated steam methane reforming (SMR) and low-carbon autothermal reforming (ATR) hydrogen production held discounts of EUR 0.95 per kilogram to EUR 1.23 per kilogram below imported ammonia-for-hydrogen.
Baseload electrolysis in the Netherlands fell back by a larger amount to end April 13 at EU 6.64 per kilo, still around EUR 2 per kilogram higher than the ammonia-to-hydrogen assessment.
Northwest Europe ammonia-to-hydrogen production costs down for ninth straight week (1)
Ammonia market
Demand for ammonia was seen as lacklustre across several regions, with tonnes arriving in Europe contracted rather than spot transactions.
The low demand in Europe for ammonia is on the back of limited fertilizer production, with run rates in the chemicals market seen around the 70% mark.
Some demand was seen emerging from Turkey, but ammonia production in the Arabian Gulf was seen elevated compared to previous years.
Northwest Europe ammonia-to-hydrogen production costs down for ninth straight week (2)
Gas market
The ICIS Dutch TTF May ’23 contract saw mild losses heading into mid-April with a limited effect of strikes affecting liquefied natural gas (LNG) regasification in France and temperatures warming to limit heating demand.
Indeed, storage injections have begun to ramp up in pae with ICIS Analytics data showing that European stocks were 642 TWh (57% full) at the beginning of the April 14 gas day, more than double the level at the same time in 2022.