Green fertilisers in the Middle East and North Africa: Decarbonising food systems while strengthening industrial value chains
Summary
Fertiliser production is of strategic importance for global food security, yet it remains highly emissions intensive and structurally exposed to fossil fuel volatility. Fossil gas makes up as much as 90% of ammonia production costs, and over 95% of fertiliser ammonia is derived from fossil feedstocks, meaning global food systems inherit the sector's price volatility, geopolitical exposure and high emissions.
The Middle East and North Africa (MENA) region, particularly Egypt, Morocco and Oman, is well positioned to become an early mover in green fertiliser production. It combines world class solar and wind resources, competitive green hydrogen cost trajectories, and large existing ammonia and fertiliser assets that can be retrofitted rather than replaced. For MENA countries, green fertilisers also represent an opportunity for broader green industrialisation, energy security and reduced exposure to volatile imported fossil inputs.
Export markets are likely to play the decisive role in early project deployment, since domestic willingness to pay a green premium is limited by the political sensitivity of fertiliser prices and food security concerns. Carbon regulation and trade measures in destination markets, including the EU's Carbon Border Adjustment Mechanism (CBAM), and instruments such as H2Global, will therefore be central to bridging the viability gap. This brief takes stock of the green fertiliser landscape in MENA, with case studies on Egypt and Morocco, and sets out key recommendations for scaling production.
Key Takeaways:
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Fertilisers are an important source of greenhouse gas emissions, contributing around 1.231 Gt of CO2eq in 2022, or 2.4% of global emissions. Roughly 80 to 85% of production related emissions are concentrated in ammonia synthesis, making green hydrogen the biggest lever for cutting emissions across the value chain.
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Egypt, Morocco and Oman combine world class renewables, competitive green hydrogen costs and existing industrial assets that can be retrofitted rather than rebuilt. Their proximity to European, African and Asian demand centres, together with national hydrogen strategies and industrial zones, positions them to become green fertiliser suppliers and hubs for wider industrialisation.
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Domestic fertiliser markets have little tolerance for a green premium given food security and pricing sensitivities. Export linked offtake into markets covered by CBAM and similar mechanisms, alongside demand-side instruments like H2Global, will be the primary drivers of early project bankability rather than local demand.
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Genuinely low emissions projects in the region remain small scale or early stage, with few reaching final investment decision or securing long term offtake. Many projects labelled "green" still rely on fossil based ammonia, underlining the need for credible standards and certification to access premium export markets and avoid greenwashing.
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Financing conditions are the binding constraint on deployment. High cost of capital, fragmented concessional finance and fertiliser contract cycles that are much shorter than the timeframes needed for infrastructure investment all point to the need for coordinated blended finance and demand aggregation to reach FID.
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Recent disruptions to gas markets and shipping routes, including the Strait of Hormuz and Red Sea, have exposed the fragility of fossil dependent fertiliser supply chains. This strengthens the case for diversifying export routes toward Mediterranean facing infrastructure such as Egypt's Suez Canal Economic Zone and Morocco's Atlantic ports.
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Scaling green fertilisers will depend on treating them as strategic industrial infrastructure rather than a marginal agricultural issue. Retrofitting existing plants offers one of the fastest, lowest risk platforms for green industrialisation in MENA, provided it is paired with concessional finance, clear certification and coordinated demand mechanisms.
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