Australia Urea Market Size and Forecast (2025–2033)
According To Renub Research Australia urea market is expected to register steady growth over the forecast period, driven primarily by the country’s strong agricultural base and increasing demand for high-nitrogen fertilizers. The market was valued at approximately US$ 1,191.73 million in 2024 and is projected to reach US$ 1,814.20 million by 2033, expanding at a compound annual growth rate (CAGR) of 4.78% from 2025 to 2033. Growth is supported by rising grain and crop cultivation, expanding livestock production, government incentives for sustainable agriculture, and policy discussions around import substitution and domestic production capacity.
Urea remains one of the most critical agricultural inputs in Australia, playing a central role in boosting crop productivity and supporting pasture management. While the market continues to rely heavily on imports, growing concerns around supply security and price volatility are shaping long-term strategies for local manufacturing and storage infrastructure development.
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Australia Urea Market Overview
Urea is a nitrogen-rich chemical compound with the formula CO(NH₂)₂ and contains approximately 46% nitrogen, making it one of the most concentrated nitrogen fertilizers available globally. Due to its high nutrient efficiency, affordability, and ease of handling, urea is widely used across agricultural systems in Australia.
In Australian agriculture, urea is a foundational input for grain crops such as wheat, barley, and canola, as well as pasture improvement for livestock grazing. It is also used in horticulture to support fruit and vegetable production. Beyond agriculture, urea plays a role in industrial applications, including the manufacture of resins, plastics, and diesel exhaust fluid (AdBlue), which is used to reduce nitrogen oxide emissions in vehicles.
Australia imports a significant portion of its urea requirements, making the market sensitive to global supply disruptions, energy prices, and geopolitical developments. In response, there is growing discussion around strengthening domestic production capabilities and improving fertilizer logistics and storage networks. Despite these challenges, urea continues to be a vital component of Australia’s food production and agricultural sustainability framework.
Growth Drivers in the Australia Urea Market
Rising Demand from the Agricultural Sector
The agricultural sector is the primary driver of urea consumption in Australia. Broadacre farming, particularly grain cultivation, relies heavily on nitrogen fertilizers to improve soil fertility and crop yields. Urea’s high nitrogen concentration and cost-effectiveness make it the preferred choice for both small-scale farmers and large commercial operations.
As global demand for food continues to increase, Australian farmers are under pressure to improve productivity while maintaining soil health. Urea plays a crucial role in meeting these objectives, particularly in nitrogen-deficient soils common across many farming regions. Expansion in grain exports, pasture improvement programs, and intensified farming practices are collectively driving consistent demand for urea across the country’s agricultural heartlands.
Government Support for Fertilizer Security and Sustainable Agriculture
The Australian government has introduced several initiatives aimed at improving fertilizer security and promoting sustainable agricultural practices. These include policies encouraging domestic manufacturing, improved supply chain resilience, and efficient nutrient management. Programs such as the National Soil Strategy emphasize soil health, productivity, and environmentally responsible fertilizer use.
Government funding and research support are also directed toward optimizing fertilizer application methods, reducing nitrogen losses, and minimizing environmental impact. Such initiatives not only support the continued use of urea but also encourage more efficient and sustainable application practices. As concerns around global supply chain disruptions grow, government backing is expected to play a vital role in stabilizing the urea market and supporting rural economies.
Expansion of Livestock and Animal Feed Industries
Australia’s expanding livestock sector is another key contributor to urea market growth. Urea is widely used as a non-protein nitrogen source in ruminant animal feed, particularly for cattle and sheep. It supports microbial protein synthesis in the rumen, improving digestion of low-quality forage and crop residues.
This application is especially valuable in dry and drought-prone regions, where pasture quality is often limited. Rising domestic consumption and export demand for beef and dairy products are increasing the need for efficient feed supplements. Additionally, urea’s role in pasture fertilization indirectly supports livestock productivity, reinforcing its importance across integrated farming systems.
Challenges in the Australia Urea Market
Heavy Dependence on Imports and Global Price Volatility
One of the most significant challenges facing the Australian urea market is its heavy reliance on imports, primarily from the Middle East and Southeast Asia. This dependence exposes the market to global price fluctuations, shipping delays, energy market volatility, and geopolitical risks.
Periods of global supply tightness can lead to sharp price increases, making fertilizers less affordable for farmers and directly affecting agricultural profitability. The lack of large-scale domestic urea manufacturing capacity limits Australia’s ability to control supply and pricing. Addressing this challenge through diversification of supply sources and investment in local production remains a critical long-term priority.
Environmental and Regulatory Constraints
Environmental concerns related to excessive or improper urea use pose another challenge. Nitrogen runoff, ammonia volatilization, and greenhouse gas emissions associated with fertilizer application have drawn increased regulatory scrutiny. As a result, farmers are being encouraged to adopt precision agriculture techniques and comply with stricter environmental guidelines.
While these measures are essential for sustainable farming, they may increase operational costs and require investment in new technologies and training. Balancing productivity with environmental protection continues to be a key challenge for the widespread and efficient use of urea in Australia.
Australia Urea Market by Type
Fertilizer Grade Urea Market
Fertilizer grade urea accounts for the largest share of the Australian urea market. Its widespread use in crop cultivation and pasture management is driven by high nitrogen content, compatibility with other nutrients, and flexibility in application. Farmers apply fertilizer grade urea in both solid and liquid forms, often in combination with other inputs.
This segment supports high-yield crops such as wheat, canola, and barley, which are central to Australia’s agricultural exports. Government support for soil health improvement and precision agriculture further strengthens demand. Fertilizer grade urea is expected to maintain steady growth over the forecast period as food security and productivity remain national priorities.
Feed Grade Urea Market
Feed grade urea is used extensively in animal nutrition, particularly for ruminants. Its role as a cost-effective nitrogen supplement enhances feed efficiency and animal performance, especially in regions with limited pasture quality. Strict regulatory controls govern its use to ensure animal safety.
With the expansion of feedlot operations and growing meat and dairy exports, feed grade urea is gaining importance within Australia’s livestock sector. This segment is expected to experience moderate but consistent growth alongside livestock industry expansion.
Australia Urea Market by Application
Agriculture Urea Market
Agriculture remains the dominant application segment for urea in Australia. Urea is essential for improving soil fertility, supporting crop rotation systems, and increasing yields in nitrogen-deficient soils. Seasonal rainfall patterns and cropping cycles significantly influence urea demand.
The long-term focus on sustainable intensification, productivity improvement, and food security ensures stable demand from the agricultural sector, making it the backbone of the Australian urea market.
Animal Feed Urea Market
Urea’s role in animal feed complements its agricultural use. As a feed additive, it improves digestion and nutrient utilization in livestock, particularly during periods of drought. Growth in feedlot operations and integrated farming systems continues to support demand in this segment.
Regional Analysis of the Australia Urea Market
New South Wales Urea Market
New South Wales (NSW) is one of Australia’s largest consumers of urea due to its extensive grain production and livestock farming. Wheat, barley, sheep, and cattle farming drive year-round demand. Variable rainfall patterns necessitate efficient nitrogen management, reinforcing the importance of urea. Strong logistics infrastructure supports consistent supply across the state.
Victoria Urea Market
Victoria’s urea market is driven by intensive dairy farming, horticulture, and high-value crop production. The state’s favorable climate and fertile soils support intensive agriculture, making nitrogen fertilizers indispensable. Adoption of precision farming and fertigation technologies is increasing, enhancing nutrient efficiency and supporting stable market growth.
South Australia Urea Market
South Australia’s dryland farming systems rely heavily on urea to support cereal crops such as wheat and barley. Low rainfall and nutrient-poor soils necessitate strategic fertilizer use. Research institutions and government extension services play a key role in promoting efficient urea application, ensuring consistent demand in the region.
Queensland Urea Market
Queensland represents one of the most diverse and significant urea markets in Australia. Sugarcane cultivation, cotton farming, grain production, and extensive livestock operations all contribute to high urea consumption. Multiple cropping seasons and pasture development for cattle grazing drive frequent fertilizer application. Government-supported nutrient management initiatives help balance productivity with environmental protection.
Market Segmentation
By Type
- Technical Grade
- Fertilizer Grade
- Feed Grade Urea
By Application
- Agriculture
- Chemical Synthesis
- Animal Feed
- Others
By States
- New South Wales
- Victoria
- Queensland
- Western Australia
- South Australia
- Australian Capital Territory
- Tasmania
- Northern Territory
Competitive Landscape
The Australia urea market features a mix of global chemical producers and fertilizer suppliers. Key players operating in this market include BASF SE, Petrobras, SABIC, Bunge Limited, Nutrien Ltd., Sasol, and CF Industries Holdings Inc..
Each company is assessed across multiple dimensions, including corporate overview, leadership, recent developments, SWOT analysis, revenue performance, and strategic initiatives.
Conclusion
The Australia urea market is positioned for steady growth through 2033, supported by strong agricultural demand, livestock expansion, and government focus on fertilizer security and sustainability. While challenges such as import dependence and environmental regulations persist, opportunities for domestic production and efficiency improvements are shaping the market’s future. As food security and sustainable farming remain national priorities, urea will continue to play a critical role in Australia’s agricultural and industrial landscape.
