Israel Chemicals Ltd. reported March 30 that its fertilizer business, ICL Fertilizers, saw a 94.5 percent increase in operating income for the year ending Dec. 31, 2007. This represents $518.9 million on a 45.1 percent increase in sales, which were $2.15 billion. This compares to 2006’s $266.8 million and $1.48 billion, respectively.
ICL cited significant price increases in phosphate and potash, together with a sharp rise in quantities of potash sold. This contrasts with 2006, when sales were lower due to a stalemate in negotiations with the Chinese. In 2007, ICL said sales rose in all target markets, particularly to South America, Asia, and Western Europe.
Fertilizer income and sales represented some 24.7 and 52.4 percent of ICL total sales in 2007, up from 2006’s 18.0 and 45.4 percent, respectively.
Fourth-quarter fertilizer operating income was $187.8 million on sales of $675.0 million, versus the year-ago $102.7 million and $440.0 million, respectively.
ICL-wide net income was reported at $535.6 million on sales of $4.1 billion for 2007, up from 2006’s $373.9 million and $3.26 billion, respectively. Fourth-quarter net income was $164.7 million on sales of $1.21 billion, up from the year-ago $90.2 million and $839.6 million, respectively.
Fresh off the positive fertilizer news, ICL announced on March 31 a spate of phosphate and potash expansions. It plans to increase production of phosphate rock by 500,000 mt during 2008 through utilization of current excess capacity. It will consider potential additional increases in phos rock production to reach full capacity utilization of 4.5 million mt, depending upon conditions in the market. It is also considering a plan to increase phos rock capacity by an additional 600,000 mt by 2010.
In addition, ICL is eyeing a plan to increase capacity of fertilizer grade phosphoric acid P205 by approximately 40,000 mt/y. It may also gradually increase capacity of phosphate fertilizers by 250,000 mt during the next four years.
On the potash side, it plans to increase production by 250,000 mt/y by increasing the carnallite production capacity of Evaporation Pond 3 at the Dead Sea. A portion of one area of the pond will be converted from salt precipitation to carnallite production. It believes that it will complete the conversion by the end of 2008, with the first carnallite harvest expected at the beginning of 2009.
ICL will also increase production capacity at the Dead Sea by an additional 250,000 mt by implementing technological improvements and opening bottlenecks in existing plants. This additional capacity will be created gradually through 2011.
ICL will also increase production at its potash mines in Spain and the United Kingdom by approximately 300,000 mt/y as a result of a program, commenced in 2007, to upgrade equipment at these mines.
Also under consideration is a plan to increase production capacity of potash at the Dead Sea by an additional 1 million mt over a period of five-to-eight years.