PACT CFT study - Fertilizer update

According to the PACT/ENVERITAS study, fertilizer imports to Indonesia in 2021 reached an estimated 1,400,000 tons, with China being the primary source of urea and NPK fertilizers. Russia and Malaysia also contributed to the imports, while Norway and Belgium were minor suppliers. The majority of imports came from the Rest of the World (ROW) category. In contrast, Vietnam imported an estimated 1,600,000 tons of fertilizers in 2021, with China and Russia being the primary sources of urea and NPK fertilizers. Malaysia, Norway, and Belgium also supplied fertilizers to Vietnam, with the ROW category accounting for the majority of imports. The relative difference in production emissions for imported fertilizers compared to local production in Southeast Asia (SE-Asia) is significant, with imported fertilizers from Europe and Russia having a higher carbon footprint than local production. The study highlights the importance of understanding the carbon footprint of fertilizer production. Today, urea is the main nitrogen source globally, and it contains carbon, which is released as CO2 after application to soil. The typical carbon footprint of urea production using Best Available Technology (BAT) is 3.5-4 tons of CO2e per ton of nitrogen. In contrast, nitrates have a lower carbon footprint, with an estimated 0.5 tons of CO2e per ton of nitrogen in a decarbonized future where hydrogen is produced by electrolysis of water. The production process of urea involves the Haber-Bosch process, which uses natural gas and steam reforming to produce ammonia. The ammonia is then converted into urea, releasing CO2 as a byproduct. In a decarbonized future, the production of urea would require the use of renewable power and electrolysis of water to produce hydrogen, eliminating the need for CO2 in the production process. This would significantly reduce the carbon footprint of urea production, making it a more sustainable option for the agricultural sector.