What are the main price drivers and cost factors for ammonium nitrate producers in China?

What are the main price drivers and cost factors for ammonium nitrate producers in China?
Ammonium nitrate pricing is highly sensitive to feedstock costs, particularly natural gas and coal, which feed into ammonia production. Historical data shows extreme volatility: prices hit a record 3,600 yuan per ton in 2008, then fell to around 1,518 yuan by 2016. After a gradual recovery, prices hovered near 2,000 yuan from 2018 to mid-2021, before spiking to 3,283 yuan in Q4 2021 due to energy cost inflation and tight supply. Producers in resource-rich regions like Xinjiang, Shanxi, and Inner Mongolia enjoy lower feedstock costs, giving them a competitive edge. Downstream civil explosives makers have limited bargaining power, so when ammonium nitrate prices jump, their margins compress sharply. However, since 2017, price controls on industrial explosives have been relaxed, allowing some cost pass-through to end users.