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Hydrogen production across South America in 2026 is estimated at approximately 2.0 to 2.5 million tonnes, positioning the region as a moderate-scale but structurally diverse hydrogen producer within the global landscape. Production is concentrated in refining, fertiliser and chemical manufacturing systems, with output largely consumed internally rather than traded as a standalone commodity.
Production volumes are governed by installed reforming capacity, refinery and fertiliser plant utilisation rates, electricity availability and infrastructure integration. Countries with large refining and fertiliser bases account for the majority of output, while electricity-driven hydrogen production is integrated selectively where power system conditions support stable utilisation.
From a production-cost perspective, hydrogen economics across South America are influenced by natural gas availability, electricity pricing, capital intensity, plant efficiency and utilisation discipline. Regions with domestic gas supply or competitive power generation exhibit more stable production economics. Capacity evolution reflects industrial demand continuity and infrastructure readiness rather than hydrogen price volatility.
Industrial hydrogen dominates allocation across South America due to continuous demand from refineries and fertiliser plants. These applications prioritise high reliability, consistent purity and uninterrupted supply, shaping plant configuration and redundancy planning.
Hydrogen derivatives, particularly ammonia, stabilise demand by embedding hydrogen into fertiliser and export-oriented value chains. Energy and mobility uses remain secondary and do not define baseload production capacity.
SMR underpins the majority of hydrogen production across South America due to its scalability and integration with existing industrial infrastructure. ATR is selectively relevant where efficiency improvements align with emissions management strategies.
Electrolysis-based hydrogen is deployed where electricity access, grid stability and utilisation economics support sustained operation. From a production perspective, electrolysis complements reforming-based output rather than displacing it.
Refining and fertiliser applications establish the baseload for hydrogen production due to continuous demand and strategic importance. Steel and energy uses influence future allocation but do not yet define core capacity requirements.
From a production standpoint, close integration between hydrogen generation and consumption supports predictable operating regimes and high utilisation.
The largest hydrogen producer in the region, anchored by extensive refining, petrochemical and fertiliser infrastructure in Brazil.
Hydrogen production linked to refining and fertiliser manufacturing, supported by domestic gas availability in Argentina.
Smaller current production volumes, with hydrogen generated for industrial use and emerging electricity-linked systems in Chile.
Hydrogen production associated with refining and fertiliser assets, serving domestic industrial demand.
South America’s hydrogen supply chain begins with natural gas procurement and electricity generation, followed by hydrogen production, compression, limited storage and direct industrial consumption or conversion into ammonia. Hydrogen transport remains limited due to co-location of production and use.
Cost drivers are dominated by gas pricing, electricity costs, capital efficiency and utilisation rates. Storage and logistics costs remain secondary, while ammonia conversion provides limited export exposure.
Pricing formation reflects energy input markets and long-term industrial contracts rather than hydrogen spot markets.
South America’s hydrogen production ecosystem includes refiners, fertiliser producers, chemical manufacturers, industrial gas suppliers, utilities and policymakers. The ecosystem is characterised by industrial integration, feedstock diversity and uneven infrastructure maturity.
Strategic priorities include securing feedstock supply, optimising reforming assets, selectively integrating electrolysis, improving efficiency and aligning hydrogen production with fertiliser security and industrial development objectives.
Hydrogen production across South America in 2026 is estimated at approximately 2.0 to 2.5 million tonnes, driven primarily by refining, fertiliser and chemical manufacturing demand.
Production costs are shaped by natural gas availability, electricity pricing, plant efficiency, capital recovery requirements and utilisation rates, with significant variation by country.
Hydrogen output is dominated by steam methane reforming (SMR), complemented by limited autothermal reforming (ATR) and a growing contribution from electrolysis-based hydrogen in selected markets.
Ammonia plays a key role by embedding hydrogen into fertiliser production and enabling limited export-oriented supply chains.
Constraints include infrastructure gaps, capital intensity, grid reliability, gas supply variability and regulatory complexity across markets.
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South America Hydrogen Production Capacity and Growth Outlook
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