The United States could become self-sufficient in fertilizer production as it ramps up shale gas production, and thus eliminate a core market for Arabian Gulf producers, the head of a global industry group warns.
North America buys 1.7 million tonnes a year of fertilizer from GCC producers, second only to East Asia. But thanks to a flood of cheap feedstock, it has announced more than 25 fertilizer projects in recent years and it has the potential to restart older plants.
Predictions of slowing fertilizer demand from India and China, and a shortage of hydrocarbon feedstock for new projects are also weighing on Gulf producers such as Abu Dhabi’s Fertil and Saudi Arabia’s Saudi Basic Industries (Sabic).
“There is likely to be increased competition from power and desalination projects, making hydrocarbon projects more expensive for the region’s fertilizer producers,” said Charlotte Hebebrand, the director general of the International Fertilizer Industry Association (Ifia) in Paris. “We are seeing a likely reduced rate of China and India on future demand expansion.”
Shale oil and gas appear likely to reshape the international energy market, with the International Energy Agency predicting that the US could overtake Saudi Arabia in oil output as early as 2017. This shift is now trickling down to downstream areas such as the fertilizer field, where Gulf producers have invested in some of the world’s biggest plants. The Saudi Arabian firm Ma’aden and Saudi Arabian Fertilizer (known as Safco, a unit of Sabic) are among those with expansions in progress.
Abdulwahab Al Sadoun, the secretary general of the Gulf Petrochemicals and Chemicals Association, said the size of Gulf firms’ fertilizer plants would help to defend them from the international challenges.
“Our competitive position will remain strong in the future,” he said, adding that some Gulf producers would struggle to compete if the scale of their facilities did not match up to world standards.
“Most of our production facilities are world-scale,” he said. “I admit that the shale gas developments will have an impact on the entire competitive market, but the Gulf producers will prevail.”
Meanwhile, executives in the fertilizer sector are voicing optimism about the industry’s outlook, forecasting a 60 per cent rise in food production by 2050.
Ninety per cent of that increase is expected to come from increasing food yields by using products such as fertilizers, rather than opening up new arable land for farming.
Ifia’s Ms Hebebrand said Africa, in which Gulf countries have made agricultural investments, could help to offset the decline in fertilizer demand in the US.
An estimated 80 per cent of potential arable land in Africa remains unused and average fertilizer use is nine kilograms per hectare, less than a tenth of the global average.
“Africa has the potential to become one of the world’s breadbaskets if it can bridge yield gaps,” Ms Hebebrand said. “Africa has the potential to become a major market for all of you. And vice versa, Africa could become a major source of food imports to the region.”
Fertilizer producers should be wary of growing environmental regulations regarding resource depletion and do more to ensure that their products do not fall into the hands of terrorists, she added.
ayee@thenational.ae
Timeline
2012-2015
The company offers payments/bribes to win key contracts in the Middle East
May 2017
The UK SFO officially opens investigation into Petrofac’s use of agents, corruption, and potential bribery to secure contracts
September 2021
Petrofac pleads guilty to seven counts of failing to prevent bribery under the UK Bribery Act
October 2021
Court fines Petrofac £77 million for bribery. Former executive receives a two-year suspended sentence
December 2024
Petrofac enters into comprehensive restructuring to strengthen the financial position of the group
May 2025
The High Court of England and Wales approves the company’s restructuring plan
July 2025
The Court of Appeal issues a judgment challenging parts of the restructuring plan
August 2025
Petrofac issues a business update to execute the restructuring and confirms it will appeal the Court of Appeal decision
October 2025
Petrofac loses a major TenneT offshore wind contract worth €13 billion. Holding company files for administration in the UK. Petrofac delisted from the London Stock Exchange
November 2025
180 Petrofac employees laid off in the UAE
The Melbourne Mercer Global Pension Index
The Melbourne Mercer Global Pension Index
Mazen Abukhater, principal and actuary at global consultancy Mercer, Middle East, says the company’s Melbourne Mercer Global Pension Index - which benchmarks 34 pension schemes across the globe to assess their adequacy, sustainability and integrity - included Saudi Arabia for the first time this year to offer a glimpse into the region.
The index highlighted fundamental issues for all 34 countries, such as a rapid ageing population and a low growth / low interest environment putting pressure on expected returns. It also highlighted the increasing popularity around the world of defined contribution schemes.
“Average life expectancy has been increasing by about three years every 10 years. Someone born in 1947 is expected to live until 85 whereas someone born in 2007 is expected to live to 103,” Mr Abukhater told the Mena Pensions Conference.
“Are our systems equipped to handle these kind of life expectancies in the future? If so many people retire at 60, they are going to be in retirement for 43 years – so we need to adapt our retirement age to our changing life expectancy.”
Saudi Arabia came in the middle of Mercer’s ranking with a score of 58.9. The report said the country's index could be raised by improving the minimum level of support for the poorest aged individuals and increasing the labour force participation rate at older ages as life expectancies rise.
Mr Abukhater said the challenges of an ageing population, increased life expectancy and some individuals relying solely on their government for financial support in their retirement years will put the system under strain.
“To relieve that pressure, governments need to consider whether it is time to switch to a defined contribution scheme so that individuals can supplement their own future with the help of government support,” he said.
European arms
Known EU weapons transfers to Ukraine since the war began: Germany 1,000 anti-tank weapons and 500 Stinger surface-to-air missiles. Luxembourg 100 NLAW anti-tank weapons, jeeps and 15 military tents as well as air transport capacity. Belgium 2,000 machine guns, 3,800 tons of fuel. Netherlands 200 Stinger missiles. Poland 100 mortars, 8 drones, Javelin anti-tank weapons, Grot assault rifles, munitions. Slovakia 12,000 pieces of artillery ammunition, 10 million litres of fuel, 2.4 million litres of aviation fuel and 2 Bozena de-mining systems. Estonia Javelin anti-tank weapons. Latvia Stinger surface to air missiles. Czech Republic machine guns, assault rifles, other light weapons and ammunition worth $8.57 million.
The Voice of Hind Rajab
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Killing of Qassem Suleimani
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Dust storm
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- Duration: Can linger for days
- Travel distance: Long-range, up to thousands of kilometres
- Source: Can be carried from distant regions
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New UK refugee system
- A new “core protection” for refugees moving from permanent to a more basic, temporary protection
- Shortened leave to remain - refugees will receive 30 months instead of five years
- A longer path to settlement with no indefinite settled status until a refugee has spent 20 years in Britain
- To encourage refugees to integrate the government will encourage them to out of the core protection route wherever possible.
- Under core protection there will be no automatic right to family reunion
- Refugees will have a reduced right to public funds
SHAITTAN
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Company%20profile
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