Nitrogenous fertilizer manufacturing has evolved considerably over the past .two decades. Rapid growth in world production capacity and the consequent fall in real world prices has led to intense competition, which threatens the viability of Australian producers.
By detailed review of the literature, production and consumption trends as well as industry structure are examined for both the world and the domestic industry. The process technology is briefly described, and production economics are discussed in detail. This provides the context in which the impact of removal of all assistance and protection for the Australian industry is examined, and its future viability assessed.
Nitrogen manufacturing in Australia is characterized by expensive feedstock, a small dispersed market, and outdated and relatively inefficient plant. It is concluded that, without external assistance or a major change in Australia's energy resource base, it is unlikely that the industry will survive in the long term. Viability in the medium term depends on a number of exogenous factors, but can be improved by cost reduction and efficiency improvement programs.