Australia Urea Market Size and Forecast 2025–2033

Australia Urea Market Outlook (2025–2033)

The Australia Urea Market is projected to expand from US$ 1,191.73 million in 2024 to US$ 1,814.20 million by 2033, registering a CAGR of 4.78% during the forecast period 2025–2033, according to Renub Research. Market growth is underpinned by rising fertilizer demand from Australia’s robust agricultural sector, expanding grain and crop cultivation, and increasing government focus on fertilizer security and sustainable farming practices.

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Australia’s reliance on nitrogen-intensive crops such as wheat, barley, canola, sugarcane, and pasture grasses makes urea one of the most critical agricultural inputs in the country. In parallel, import substitution policies, ongoing discussions around domestic production capacity, and growing awareness of efficient nutrient management are shaping long-term market dynamics.

Australia Urea Market Overview

Urea is a nitrogen-rich chemical compound with the formula CO(NH₂)₂, containing approximately 46% nitrogen, making it one of the most concentrated and efficient nitrogen fertilizers globally. Its affordability, high nutrient density, and ease of transportation and storage have positioned urea as the most widely used nitrogen fertilizer in Australian agriculture.

In Australia, urea plays a vital role across broadacre farming, livestock pasture development, and horticulture. It enhances soil fertility, supports rapid plant growth, and significantly boosts crop yields. Beyond agriculture, urea is also used in industrial applications, including the manufacture of resins, plastics, and diesel exhaust fluid (AdBlue), which helps reduce nitrogen oxide emissions from vehicles.

Despite its importance, Australia currently imports the majority of its urea requirements, exposing the market to global supply chain disruptions, volatile international prices, and geopolitical risks. As food security, climate resilience, and domestic manufacturing gain policy priority, urea remains central to Australia’s agricultural and industrial strategies.

Key Growth Drivers in the Australia Urea Market

1. Rising Demand from the Agricultural Sector

Australia’s agriculture sector remains the backbone of urea consumption. With extensive cultivation of cereals, oilseeds, pulses, and fodder crops, farmers depend heavily on nitrogen fertilizers to maintain productivity and soil health. Urea’s cost-effectiveness and high nitrogen content make it the preferred choice across both small-scale farms and large commercial operations.

Increasing global demand for Australian agricultural exports—particularly grains and meat—has intensified the need to improve yields per hectare. As sustainable intensification becomes a national priority, optimized urea application continues to support higher productivity while maintaining competitiveness in global markets.

2. Government Support for Fertilizer Security and Sustainability

In recent years, fertilizer security has emerged as a strategic concern for Australia. Government initiatives aimed at reducing reliance on imports, improving logistics infrastructure, and encouraging sustainable fertilizer use are positively influencing the urea market.

Programs such as the National Soil Strategy promote improved nutrient management, soil carbon enhancement, and efficient fertilizer application. These initiatives not only support environmental goals but also ensure long-term demand stability for urea.

In August 2024, the Australian Farm Institute received a US$ 638,000 grant to support international collaboration on sustainable agriculture. The project focuses on developing trade standards and production guidelines aligned with Australia’s climate commitments, indirectly supporting responsible fertilizer usage nationwide.

3. Expansion of Livestock and Feed Industries

Australia’s livestock sector—particularly beef, dairy, and sheep farming—is another significant driver of urea demand. Feed-grade urea is widely used as a non-protein nitrogen source in ruminant diets, improving digestion of low-quality forage and crop residues.

This application is especially valuable during drought periods and in arid regions where pasture quality is limited. Additionally, urea enhances pasture regrowth, indirectly supporting livestock productivity.

In August 2024, Australian firm Food Recycle raised US$ 3 million to scale technology that converts commercial food waste into animal feed. Such innovations reinforce the importance of efficient nitrogen utilization across Australia’s integrated agricultural systems.

Challenges Facing the Australia Urea Market

Heavy Dependence on Imports and Global Price Volatility

Australia’s reliance on imported urea—primarily from the Middle East and Southeast Asia—leaves the market vulnerable to international price fluctuations, shipping delays, and geopolitical tensions. During periods of global supply disruption, fertilizer prices can spike sharply, affecting farm profitability and cropping decisions.

The lack of large-scale domestic urea manufacturing capacity remains a structural challenge. While discussions around local production and storage expansion continue, ensuring long-term affordability and availability remains a key concern for policymakers and farmers alike.

Environmental and Regulatory Constraints

Improper or excessive urea application can lead to nitrogen runoff, greenhouse gas emissions, and soil degradation. As a result, environmental regulations governing fertilizer use are becoming increasingly stringent.

Farmers are encouraged to adopt precision agriculture, controlled-release fertilizers, and best-practice nutrient management plans. While these measures support sustainability, they can increase operational costs and require investment in new technologies and training. Balancing productivity with environmental responsibility remains an ongoing challenge for the urea market.

Australia Urea Market Segmentation Analysis

By Type

Fertilizer Grade Urea

Fertilizer-grade urea dominates the Australian market due to its extensive use in crop cultivation and pasture management. Its high nitrogen concentration and compatibility with blended fertilizers make it essential for cereal crops such as wheat, barley, and canola. Government support for soil health and precision farming further strengthens this segment’s outlook.

Technical Grade Urea

Used primarily in industrial processes, technical-grade urea supports chemical manufacturing, resins, and emission-control solutions such as AdBlue.

Feed Grade Urea

Strictly regulated feed-grade urea is increasingly used in livestock nutrition, particularly in cattle and sheep farming.

By Application

Agriculture

The largest application segment, driven by crop production, pasture improvement, and soil fertility management.

Animal Feed

Used as a nitrogen supplement in ruminant diets, supporting Australia’s expanding meat and dairy industries.

Chemical Synthesis & Others

Includes industrial uses in resins, plastics, and environmental applications.

Regional Analysis: Australia Urea Market by State

New South Wales (NSW)

NSW is a major consumer of urea due to its large-scale wheat, barley, and livestock farming. Variable rainfall patterns necessitate efficient nitrogen management, driving consistent urea demand. Strong logistics networks and sustainability-focused agricultural programs further support market growth.

Victoria

Victoria’s urea market is driven by intensive dairy farming, horticulture, and high-value crops. Urea is widely used for pasture renewal and silage production. Increasing adoption of fertigation and precision farming technologies enhances nutrient efficiency across the state.

South Australia

Dryland agriculture dominates South Australia, where urea is essential for cereal crops grown in low-rainfall conditions. Strategic pre-seeding and top-dressing applications are common, supported by research institutions and government extension services.

Queensland

Queensland represents one of Australia’s largest urea markets due to its diverse agricultural profile, including sugarcane, cotton, grains, and cattle. Sugarcane cultivation, in particular, requires high nitrogen inputs. Multiple cropping seasons and extensive feedlot operations ensure year-round urea demand.

Competitive Landscape: Key Companies in the Australia Urea Market

The Australian urea market is shaped by global fertilizer producers and suppliers, each contributing through imports, distribution networks, and technological innovation. Key players include:

BASF SE

Petrobras

SABIC

Bunge Limited

Nutrien Ltd.

Sasol

CF Industries Holdings Inc.

Each company is evaluated across five viewpoints:

Company Overview

Key Executives

Recent Developments

SWOT Analysis

Revenue and Strategic Positioning

Future Outlook: Australia Urea Market

Looking ahead, the Australia urea market is expected to benefit from:

Continued growth in grain, livestock, and horticultural production

Increased focus on fertilizer security and domestic resilience

Adoption of precision agriculture and sustainable nutrient management

Potential investments in local manufacturing and storage infrastructure

While import dependence and environmental constraints present challenges, technological innovation and supportive policy frameworks are likely to ensure steady market expansion through 2033.

Final Thoughts

The Australia Urea Market stands at the intersection of agricultural productivity, sustainability, and national supply security. With strong demand fundamentals, supportive government initiatives, and evolving farming practices, urea will remain an indispensable input for Australia’s food and agricultural systems.

As the country navigates climate variability, global supply uncertainties, and environmental responsibilities, strategic management of urea production, distribution, and application will be critical. For farmers, policymakers, and industry stakeholders alike, the decade ahead offers both challenges and opportunities—positioning urea as a cornerstone of Australia’s agricultural future.