A method forms a relatively stable ammonium nitrate composite material. The method includes (a) blending ammonium nitrate with an average particle diameter greater than about 1 mm and a substantially non-oxidizing compound in fine particle form; and (b) reducing the average size of said ammonium nitrate granules in the presence of the non-oxidizing compound in fine particle form to produce a substantially homogeneous blend of ammonium nitrate and the non-oxidizing compound having an average particle diameter of about 1 to about 1,000 μm to form a substantially non-explosive powder.