THE first cargo ships that would be powered by ammonia are set to enter service in 2026, one of several alternatives the industry is tapping to shrink a carbon footprint accounting for nearly 3 per cent of global emissions.

But ammonia faces major cost and safety hurdles as a shipping fuel compared to others, such as liquefied natural gas (LNG), methanol, and biofuels.

Ammonia's appeal is that it is carbon free and would be a zero-emission fuel if made from hydrogen produced with renewable electricity.

But safety is a big challenge for the product typically used for fertilizers and explosives.

Last month, at one of the world's biggest bulk export ports in Western Australia, shippers safely completed the first transfer of ammonia from one vessel to another last month, a key test for its adoption as a marine fuel in the push for cleaner energy.

"Currently the lack of regulation, experience in use and toxicity of ammonia on board ships constitute major safety deterrents," said Laure Baratgin, head of commercial operations at mining giant Rio Tinto.

Top global iron ore producer Rio is the biggest exporter at Dampier, where the ammonia transfer trial was run. It operates dual-fuelled bulk ships that run on traditional marine fuel or LNG but has yet to charter or order ammonia-fuelled vessels.