After the year 2000, it became more profitable to use imported ammonia in the U.S. due to high natural gas costs. As a result, many of the nation’s smaller ammonia plants closed. Between 2000 and 2006, U.S. ammonia production declined 44 percent and U.S. ammonia imports increased 115 percent. As shown by the pie graph which follows, in 2009/10 the United States imported nitrogen from Trinidad, Canada, Russia, Egypt, Venezuela, and other nations.
Ammonia production plants are located near natural gas supplies, as shown on the 2006 map below. The fertilizers are consumed in the Midwestern Corn Belt within a very short time frame in the fall and again in the spring. Pipelines, barges, and railways are required to move and handle large volumes of fertilizer during these periods of high demand. Consequently, the compromised barge traffic on the Mississippi River from recent low water levels concerned farmers. A logical opportunity for utilizing our increased natural gas supply lies in producing more of our own nitrogen fertilizer. We imported 54 percent, or 10.79 million tons (a record) of the nitrogen fertilizer used for farming here in the U.S. in 2011, according to the USDA.
Our long term planning is a disaster. Close fertilizer and chemical plants because natural gas prices are high. Build gas power plants because natural gas prices are low. Build coal plants because gas prices are high. Build more fertilizer, chemical and power plants because gas prices are low. What's next? I'll bet on gas prices being high. Give it five years and we'll see what is in the headlines.