Argus launches global low-carbon ammonia benchmark
Investors - JUNE 27, 2024

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Argus launches global low-carbon ammonia benchmark

by Released

Argus, a global energy and commodity price reporting agency, has launched an index to assist companies trading low-carbon hydrogen products distributed to key markets in northeast Asia.

The Argus Japan Korea Low-Carbon Ammonia Benchmark (JKLAB) is for the mass-balanced all-in cost of low-carbon (blue), liquid ammonia produced in the U.S. Gulf coast and delivered to either Ulsan, South Korea, or Niihama, Japan. This cost-based approach is fundamentally different from assessing spot prices and is designed specifically to assist offtake negotiations.

The lack of a clear market reference for low-carbon ammonia has made counterparty negotiations difficult, with a broad range of formulas used to agree provisional offtake deals. These must now be finalized, yet variations in formula pricing present significant risks for end user utilities that operate on a cost-plus model, as well as developers themselves.

The Argus JKLAB index offers buyers in Japan and South Korea as

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