Southern Plains:
Intrepid’s last postings for Trio FOB Carlsbad included $380/st for standard, $415/st for granular, $425/st for premium, $430/st for OMRI standard and fine standard, and $465/st for OMRI granular.
All posts by dhouder1@bloomberg.net
Potassium Thiosulfate
Eastern Cornbelt:
Potassium thiosulfate remained at $730/st FOB Terre Haute, Ind., for the last confirmed offers.
Intrepid Completes Drilling Projects at Moab Potash Mine
Intrepid Potash Inc. announced on July 10 that it has completed the Well 45 and Well 46 drilling projects at its solar solution potash mine in Moab, Utah, in time for the 2023 evaporation season. The company said both projects were completed on schedule and build on the success of its Phase One HB Injection Pipeline Project, which was announced on June 21 (GM June 23, p. 1).
Intrepid said Well 45 and Well 46 will help it deliver on key goals of maximizing brine availability and underground brine residence time, which is expected to lead to improved brine grade and higher and more consistent production. The company continues to expect its 2023 capital program to be in the range of $60-75 million.
“Successfully executing both projects required a very high level of technical expertise and our new design for Well 45 led to significant cost savings compared to our previous horizontal caverns due to the single-well design,” said Bob Jornayvaz, Intrepid’s Executive Chairman and CEO.
Intrepid said Well 45 is a newly designed, single-well cavern system with three interlocking laterals that targets new ore in Potash Bed 9. This single-well cavern is designed to have a long operational life with the laterals completed over approximately 18,000 feet of horizontal drilling. The company said brine measurements have shown good availability of high-grade ore.
After cavern development, Intrepid said it will switch to injecting salt-saturated brine and begin selective solution mining, with the benefit of Well 45 beginning in the 2024 evaporation season. The total capital cost of Well 45 was approximately $11.5 million, which Intrepid said was approximately 40% lower than its previous two-well cavern systems.
Intrepid said Well 46 is a horizontal drilling project designed to target a high-grade brine pool in the original mine workings in Potash Bed 5, which was previously accessed by a nearly 50-year-old well that was plugged-and-abandoned. The capital cost was approximately $5 million.
Intrepid said it expects Well 46 to contribute to its 2023 potash production when harvest begins in the third quarter; create medium- to longer-term wellbore access to drill additional laterals to target unmined ore in Potash Bed 5 or access other stranded brine pools; and serve as a backup for other injection/extraction wells.
“While our Moab potash operation has been our most consistent production asset, these projects are expected to help ensure this continues to be a world-class operation for many years to come,” Jornayvaz said. “Our focus continues to be successful project execution across our operations, and I’m very encouraged by the results so far.”
Simplot Reaches Settlement with DOJ, EPA
The J.R. Simplot Co. will spend close to $150 million on waste processing upgrades and pay a $1.5 million civil penalty to resolve alleged Resource Conservation and Recovery Act violations at its Don Plant fertilizer facility near Pocatello, Idaho, the US Justice Department and Environmental Protection Agency announced on July 11.
According to the two federal agencies, Simplot allegedly failed to properly identify and manage certain waste streams as hazardous wastes, and also violated the Clean Air Act in relation to fluoride emissions at the facility.
Under the settlement, Simplot has agreed to implement specific waste management measures it has valued at nearly $150 million, including efforts to recover and reuse the phosphate content within these wastes and avoid their disposal in a gypstack. Simplot also agreed to implement requirements to ensure gypstack stability, including a detailed plan for the future closure and long-term care of the gypstack.
Simplot also agreed to cease operation of the facility’s cooling towers no later than June 27, 2026, and replace them with one or more new cooling ponds, which the DOJ and EPA said will significantly reduce fluoride emissions to the air. Additionally, Simplot agreed to submit revised Toxic Release Inventory forms for 2004-2013 that include estimates of certain metal compounds manufactured, processed, or otherwise used at the facility.
In addition to paying the $1.5 million civil penalty, Simplot is providing $200,000 in funding for environmental mitigation work that will be administered by the Idaho Department of Environmental Quality in conjunction with the City of Pocatello and the Shoshone-Bannock Tribes. The mitigation work will address habitat degradation on the Portneuf River that has resulted in part from excess phosphorus releases, the DOJ and EPA said.
“The J.R. Simplot Company is pleased to have worked with the Environmental Protection Agency and the Department of Justice to reach this settlement,” said a statement provided to Idaho Reports from Simplot spokesperson Josh Jordan.
“This more than 500-page settlement, which took over 15 years to achieve, provides for additional recovery of phosphate in our production process and other environmental protection measures associated with the handling of our ore processing materials and wastes,” the statement said. “This settlement is part of our work to continue to provide important crop nutrients throughout North America to help feed a growing population.”
The Andersons Completes Purchase of ACJ
The Andersons Inc., Maumee, Ohio, announced on July 10 that it has completed the purchase of ACJ International LLC (ACJ) and its subsidiaries, an ingredient, logistics, and supply chain management company that focuses on the pet food industry. The deal was first announced on June 13 (GM June 16, p. 27). Terms were not disclosed.
“The pet food industry continues to increase its demand for high-quality and responsibly sourced ingredients,” said Weston Heide, Senior Vice President for The Andersons Trade and Processing. “This acquisition expands our portfolio of ingredients while also enhancing our supply chain services throughout the central region of the US to provide further support for our customers in the pet food markets.”
The purchase includes ACJ’s headquarters in Lake St. Louis, Mo., and its facility locations in Joplin, Mo., Webb City, Mo., and Monroe, Wisc. Verdant Partners LLC served as advisor to ACJ in the transaction.
“We are excited to be joining an organization with such a rich history and deep roots in agriculture,” said Michael Peterson, President of ACJ. “Being a part of The Andersons will provide our customers access to an expanded portfolio of ingredients and services while maintaining high standards of quality, integrity, and transparency.”
SOPerior Receives Notice of Default from Lender
Junior sulfate of potash producer SOPerior Fertilizer Corp., Toronto, Ont., reported on July 11 that it received a notice of default on June 29 from Lind Asset Management VII LLC, a fund managed by The Lind Partners LLC.
Lind’s default notice is requesting that SOPerior pay the principal and interest due and outstanding under a Convertible Security Funding Agreement (CSFA) dated Dec. 16, 2016, as amended.
SOPerior said its proposed JV partner, Argos Investment Partners, had informed the company that it was committed to remedying the default notice by a July 10 deadline, but failed to do so. As a result, SOPerior said it is currently in discussions with Lind and is exploring alternatives. SOPerior in 2021 (GM Dec. 10, 2021) entered into a joint venture agreement for its Blawn Mountain alunite asset in Beaver County, Utah, where it plans to produce SOP by mining and processing alunite-bearing rock. At the time, SOPerior said the proposed jv’s first phase commercial production facility and future expansion phases were to be constructed on the site of an existing copper processing operation, with initial project capacity estimates of over 70,000 mt/y of SOP, 140,000 mt/y alumina, and 150,000 mt/y of sulfuric acid.
Poland Takes Control of Acron Shares in Azoty
The Polish state has established a “temporary custodian” for a 19.82% stake held by a Russian businessman in Polish fertilizers and chemicals company Grupa Azoty SA, according to a July 11 Polish Press Agency (PAP) report, citing Poland’s Minister of Economic Development and Technology Waldemar Buda.
The stake is held indirectly by Viatcheslav Kantor, who is a large shareholder in Russian fertilizer producer Acron Group through related parties including Norica Holding Sàrl of Luxembourg, Opansa Enterprises Ltd. of Cyprus, and Rainbee Holdings Ltd. of Cyprus, according to a statement on Grupa Azoty’s website.
Buda said the Polish state is seeking a partner to take over the shareholding and pay compensation. Reports circulated in May that the ministry might take over the stake (GM May 12, p. 33) to deprive Acron of executing its voting rights at Azoty’s shareholder meetings following Russia’s invasion of Ukraine, according to the newspaper Puls Biznesu, as cited by Bloomberg.
In its statement, Azoty said Kantor is not a beneficial owner of the Azoty group within the meaning of the European Parliament and the European Council, and that he “neither owns nor has control over the group within the meaning of the EU sanctions legislation.”
In a July 13 statement on its website, Acron said it believes that the temporary compulsory administration imposed by the Polish ministry on its three subsidiaries is “a gross violation of both international and national law.” Acron said its companies intend to challenge these illegal actions in Polish courts, the European Court of Justice, and through international arbitration.
The Russian fertilizer group added that it has held the shares in Grupa Azoty since 2012, and to date “has not been actively involved in the company management, remaining a portfolio investor and operating strictly within the legal framework.” It said it views the actions of the Polish authorities as “unmotivated, unjust, and illegal expropriation.”
Acron added that Radosław Kwaśnicki, who was appointed as the temporary administrator, is a member of the Supervisory Board of Orlen Group’s subsidiary and held a similar position in PKN Orlen S.A. in 2014-2019.
“Therefore, the appointed administrator has a potential conflict of interest because Orlen is also a fertilizer producer in direct competition with Grupa Azoty and Acron Group on certain markets, and has recently announced its intention to acquire Grupa Azoty Puławy, a subsidiary of Grupa Azoty,” Acron said.
In a move to improve its financial position, Grupa Azoty in June inked a cooperation and non-disclosure agreement with Polish energy group Orlen SA on the potential sale of Azoty’s most profitable subsidiary, Zakłady Azotowe Puławy, to Orlen (GM June 9, p. 1).
Azoty in the past two months has warned that it may breach debt covenants at the end of the second quarter after reporting a first-quarter group net loss of Pln555 million (approximately $138 million at current exchange rates). The company on July 13 said it sees its situation as “stable with jobs not at risk,” adding that it expects “optimization of production processes and improvement of the business situation” in the third quarter.
Allegations of Price Fixing Investigated in Pakistan
The Competition Commission of Pakistan (CCP) has recommended action against four urea producers and the Fertilizer Manufacturers of Pakistan Advisory Council (FMPAC) on allegations of price fixing. The investigation into the charges began in November 2021 when the companies and the FMPAC published new prices for urea at Rs1,750/50-kg bag (US$6.34/50-kg bag) from Rs1,518-1,520/50-kg bag.
According to a July 12 statement issued by the CCP, complaints were raised when Fauji Fertilizer, Engro Fertilizers, Fatima Fertilizer, and Agritech issued their urea price lists with each showing a similar price increase. The CCP statement said variations in cost structures and subsidies for the four companies were sufficiently different that the uniformity in the price increases were suspicious. The FMPAC was included in the charges when it published the prices.
Fauji dominates the market with a 39% share, followed by Engro at 36%. Fatima Fertilizer has a market share of 13% and Agritech accounts for 4%. The CCP noted that because of the price increase, Fauji, Fatima, and Engro saw significant profits for 2021, which the agency said came at the expense of farmers and consumers. The maximum penalty allowed under the Competition Act of 2010 that established the CCP is Rs75 million (US$272,000), or 10% of the annual turnover.
Czech Republic’s Unipetrol Completes Upgrade
The Czech Republic’s Unipetrol, a wholly owned subsidiary of Polish energy group Orlen Group SA (GM Oct. 12, 2018), reported that it has completed a Czk370 million (approximately $17.2 million at current exchange rates) project to modernize its ammonia production plant in Litvínov.
The project, which included the commissioning of a new ammonia reactor, has raised Unipetrol’s ammonia production capacity to 500 mt/day and reduced CO2 emissions at the site.
Unipetrol, through wholly owned subsidiary Neratovice-based Spolana, produces agricultural and industrial grades of ammonium sulfate and is also the Czech Republic’s only producer of PVC and caprolactam.
Acron Group Increases Sales of Calcium Nitrate
Acron Group said it has delivered more than 50,000 mt of calcium nitrate (CN) to its customers since commissioning a new unit at its Veliky Novgorod production site in northwest Russia in August 2022. Acron is supplying the CN in 25 kg bags and in various types of “big bags.”
The unit was Acron’s first CN production unit and has capacity to produce 100,000 mt/y of granulated product (GM Aug. 12, 2022). Acron uses liquid CN, a byproduct of apatite concentrate processing at the group’s NPK plants, as the feedstock for the new product, according to a company statement on July 7. Acron said the unit has been exceeding its design capacity since the beginning of 2023. Production has also started on a new brand of CN containing boron. The unit produces various brands both for agriculture and industry. The CN tons have been sold in Russia, Latin America, Africa, India, and Southeast Asia, the group said.