All posts by hlancey@bloomberg.net

Marcus Construction Acquires Northern Sierra Corp.

News Briefs, U.S.

Willmar, Minn.-based Marcus Construction, a family-owned construction manager and general contractor with more than six decades of agribusiness industry experience, announced that it has acquired Northern Sierra Corp., a manufacturer of bulk storage structures based in Saginaw, Mich.

Marcus said the acquisition allows it to provide design-build services for single product dome storage and arch barrel buildings, integrating these services into the company’s comprehensive suite of bulk storage solutions. Marcus said it will oversee all aspects of the process, from initial design and engineering to final construction.

“This is a truly exciting time at Marcus Construction,” said David Klima, Vice President of the Agribusiness Division. “While we are renowned for our diverse line-up of multi-product offerings, ranging from dry fertilizer and liquid fertilizer storage to chemical and seed warehouses, the acquisition of Northern Sierra Corporation presented a unique opportunity.

“Their stellar reputation and specialized single product storage solution aligns seamlessly with our agricultural storage portfolio,” Klima continued. “We’re thrilled to introduce another design-build option for our clients with bulk storage needs. Additionally, this acquisition enables us to provide maintenance and repair services for existing bulk dome storage buildings.”

Unigel Gets Temporary Protection from Creditors

Brazil, News Briefs

A Brazilian judge has given Unigel Participacoes temporary protection from creditors, according to a Bloomberg report on Dec. 14. Any executions on the debt will be suspended by no more than 60 days, according to the decision made by Judge Paulo Furtado de Oliveira Filho.

The company is expected to use the time to seek a mediation process with creditors over its debt restructuring. Earlier in the week, a request to fend off creditors had been denied by a different judge, and the company sought to reverse the decision.

Unigel had sought the temporary protection after local bondholders in a Dec. 6 meeting voted to declare the early maturity of some notes, triggering an acceleration of the troubled chemical and fertilizer maker’s dollar debt. 

Unigel, which was also holding separate talks with external bondholders, had its credit score cut to default by S&P Global Ratings in November after skipping a $23.2 million interest payment on the dollar bonds.

Unigel just recently signed an agreement to sell 100% of Plastiglas, its Mexico-based acrylic sheet manufacturer, to the Verzatec Group (GM Dec. 8, p. 26). The sale is in line with Unigel’s plan to readjust its capital structure. Sale proceeds are to be used to strengthen the company’s cash position.

Yildirim Seeks Full Ownership of Petrokemija

Ammonia, Ammonium Nitrate, Natural Gas, News Briefs, Nitrogen, Turkey, UAN, Urea

Turkey’s Yildirim Holding AS is looking to secure full ownership of Croatian fertilizer producer Petrokemija dd, in which it already owns a 54.517% controlling stake.

The Turkish company is reported to have submitted an investment plan for Petrokemija to the Croatian government, which holds a 45% stake in the fertilizer company, according to a SeeNews report, citing Croatian daily Poslovni Dnevnik.

According to the report, Petrokemija suspended production in September just two months after restarting it in July following a 15-month stoppage due to high natural gas prices and unfavorable market conditions (GM July 21, p. 29).

Yildirim has reportedly proposed three options for its future ownership relationship of Petrokemija. One involves a capital increase by the Turkish company, which would result in a reduction in the state’s stake in the fertilizer producer. Another option is the sale of the government’s holding, followed by a squeeze-out of the other shareholder, which holds about 0.3% of the capital. A third option is reported to involve a joint capital increase by the Croatian state and Yildirim, with their contributions aligned with their respective shares in Petrokemija.

However, according to the Poslovni Dnevnik report, with general elections scheduled for next year, Croatia’s government is unlikely to make a decision regarding the state’s share in the fertilizer producer during the current term of office.

Yildirim completed the acquisition of its 54.517% stake in Petrokemija in April after reaching an agreement in November last year with Croatian oil and gas group ING dd and Croatian gas company Prvo Plinarsko Društvo to acquire Terra Mineralna Gnojiva company (TMG), which held a 54.517% stake in the Croatian fertilizer producer (GM Nov. 18, 2022).

Petrokemija is Croatia’s sole fertilizer producer. Its nameplate production capacity for nitrogen fertilizer includes 0.45 million mt/y of ammonia, 0.31 million mt/y of ammonium nitrate, 0.5 million mt/y of urea, and 0.2 million mt/y of UAN, according to the Green Markets database.

Murmansk Governor Says Belarus Still Keen on Port

China, News Briefs, Potash, Russia

Belarus still has plans to build a port near Murmansk in northwest Russia to handle its potash and fertilizer shipments, according to an Interfax report this week, citing an interview with Murmansk Oblast Governor Andrei Chibis

Chibis said that Belarus sees Murmansk as “a promising port” and is “working on issues related to shipments to China.” According to the governor, the current proposal, which still needs to be “packaged and finalized,” is a request from Belarus for a separate port with a transshipment capacity of 5-7 million mt/y.

Several options have been proposed for the location of the Belarusian port. In December 2022, the governor of the Murmansk region said work on the design of the Belaruskali fertilizer terminal could begin on the western shore of the Kola Bay in 2023, and construction could begin in 2024.

Belarus began reorienting transshipments of its potash exports to Russian ports and has also increased exports to China by rail after Lithuania’s government terminated the railway transit contract between the country’s state-owned railway company Lietuvos Geležinkeliai (LTG) and Belaruskali as of Feb. 1, 2022, over national security concerns (GM Jan. 14, 2022). The Lithuanian government’s decision came in the wake of EU and US sectoral sanctions on Belarus, which included, among other things, a ban on the trading and transit of potash.

The removal of the Lithuanian rail route effectively blocked Belaruskali’s key export route. Before the imposition of Western sanctions, the Belarus producer and its marketing/export arm, Belarusian Potash Co. (BPC), shipped 10-11 million mt of potash annually through the Lithuanian port of Klaipėda.

First Phosphate, Ultion Tech Ink MOU

Canada, Lithium, News Briefs

Junior miner First Phosphate Corp., Saguenay, Quebec, announced on Dec. 11 that it has signed a Memorandum of Understanding (MOU) with Ultion Technologies Inc., Las Vegas, for the purchase of a non-exclusive, perpetual license to technology for the production of lithium iron phosphate (LFP) and lithium iron manganese phosphate (LFMP) cathode active material (CAM).

“The agreement is important to the company because it provides proven, commercial-grade LFP production technology as well as offtake into the LFP CAM specialty products segment of the market,” said First Phosphate CEO John Passalacqua. “We are building our entry into LFP CAM production in a careful and systematic manner. Access to various LFP production technologies reduces our technology risk and allows us to diversify industry exposure by servicing various markets and various client needs.”

“We are excited to be working with First Phosphate in developing the lithium battery supply chain in North America,” said Ultion CEO Dr. Johnnie Stoker. “With their secure source of high purity ore and commitment to develop downstream processing of Cathode Active Materials, First Phosphate will become a key player in the LFP/LFMP supply chain. It is critical that these materials be made in our region.”

The parties said the LFP technology contemplated by this MOU is currently in production in two facilities with capacities of 10,000 mt/y and 50,000 mt/y. They estimated the market value of 50,000 mt of LFP CAM at $625 million to $1.25 billion based on recent market price ranges. The LFMP technology contemplated in this MOU is currently under development and being produced at a quantity of several mt per month.

Under the MOU, First Phosphate will work to provide Ultion with up to 2,000 mt/y of LFP CAM for its LFP battery cell manufacturing business for specialty products. Ultion is planning on beginning production in 2025, which will need up to 500 mt of LFP CAM and will ramp up to full production requiring up to 2,000 mt by 2029.

This MOU with Ultion, together with the MOU with American Battery Factory signed on Sept. 13, 2023 (GM Sept. 29, p. 26), provides First Phosphate with a total minimum offtake potential of 46,000 mt of LFP CAM to be fulfilled slowly starting in 2026 and ramping up by 2028/2029.

Intrepid Names Pickering as Lithium Adviser

Lithium, News Briefs, Potash, U.S.

Intrepid Potash Inc. on Dec. 12 announced that it has engaged Pickering Energy Partners LP to advise on maximizing the value of the lithium resource at its mine in Wendover, Utah. In addition to potash and salt, Wendover’s brine resource also contains magnesium, lithium, and other associated minerals, according to Intrepid.

The Wendover evaporative area is over 11,000 acres and lithium concentrations have been measured at over 1,500 parts per million in the final byproduct brine.

“I am excited to announce our engagement with Pickering to help us evaluate our options to capitalize on the value of the lithium that we have long known to be present in the brine at our Wendover mine,” said Bob Jornayvaz, Intrepid Executive Chairman. “Pickering has established itself as a leader and trusted advisor in the energy space and we are excited to partner together and evaluate promising new direct lithium extraction (DLE) technologies to recover lithium from our brine and create value for Intrepid and our shareholders.”

“The majority of the lithium Intrepid currently extracts from its deep brine wells as part of its potash operation is on fee land and Intrepid’s existing, large-scale evaporative assets greatly simplify the story,” said Diego Kuschnir, who leads Pickering’s Energy Transition Banking practice. “We are excited to represent Intrepid on this unique energy transition project and look forward to helping Intrepid expand the domestic supply of lithium and achieve maximum value for its lithium brine.”

Intrepid Expects $100 M After Amendment

News Briefs, Potash

Intrepid Potash Inc. on Dec. 12 said it expects to pull in some $100 million or more for an amendment to its Designated Potash Area (DPA) that will allow XTO Holdings and XTO Delaware Basin, subsidiaries of ExxonMobil, to pursue drilling activities within the DPA.

Between Dec. 12, 2023, and Jan. 2, 2024, Intrepid will receive $50 million and another $50 million as an “access fee” at a later date. XTO would also pay up to a maximum amount of $100 million as an “access realization fee” in the event of certain additional drilling activities.

IFWN Adds More Patents, Presents Technology

News Briefs

Growth promotion developer Innovations for World Nutrition (IFWN), Florence, Ala., added two more patents on April 25 and Oct. 13 of this year and presented the technology for the current five patents (GM Aug. 19, 2022; Aug. 13, 2021; May 1, 2020; April 5, 2019) last month at the T3 Fertilizer Conference in New Orleans, La.

The patents are all growth promoters aimed at enhancing initial seed growth resulting in actual yields of grain and fiber of over 60%. The potential yield increases are over 100% once the technology is perfected, according to inventor Ray Shirley, long-time industry veteran and Founder and Chairman of Applied Chemical Technology Inc. (ACT). IFWN has contracted ACT’s team of research specialists to develop the technology with initial growth testing in their labs and greenhouses.

The growth promoter uses seed grind from a total seed, in essence providing extra total DNA to the coated or planted seed. Shirley, the primary inventor, said other ingredients include baking soda, sugar syrup, and a nitrogen source. He said all are readily available at a low cost globally, thus meeting IFWN’s goal of feeding the world using materials found most everywhere.

Gensource Updates on Seismic Program, Financing

Canada, News Briefs, Potash

Junior miner Gensource Potash Corp., Saskatoon, Sask., on Dec. 7 announced that following a successful flow-through program financing, it officially initiated the 2023 Vanguard North 3D Seismic program in September.

The project aims to explore and confirm the resource for the sub-surface Mineral Permit SMP200 acquired in November 2021, which is contiguous with the company’s designated mining area. It also plans to expand the dataset for the existing resource defined in KL245 for the Tugaske Potash Project. The results will be quantified in a subsequent NI 43-101 Technical Report.

Gensource also reported that it has been engaged in discussions with several financial institutions to secure full project financing for Tugaske. It said following detailed negotiations with private funding groups during the summer, it is focused on reaching an agreement with a preferred funding entity.

The company said the objective is to swiftly conclude ongoing negotiations and progress in stages toward full project financing, enabling Tugaske to transition into construction and operational phases. The company said that while timing remains challenging to estimate, the company is dedicated to expediting the negotiation process.

Ammonia

Ammonia, Eastern Cornbelt, India, Market Watch, Middle East, Northwestern Europe, South Central, Southern Plains, Tampa, U.S. Exports, U.S. Gulf, U.S. Imports, Western Cornbelt

US Gulf/Tampa:

No news was reported on the Tampa ammonia price for January, nor on its expected direction. The December Tampa price was concluded at $625/mt CFR, flat from November.

US Imports:

October ammonia imports stood at 164,358 st, the US Census Bureau reported, up 24.8% from the 131,732 st posted last October. July-October volumes softened 11.4%, however, to 686,705 st from the year-ago 775,343 st.

Canada sent 364,426 st to the US in the July-October fertilizer year-to-date, Trinidad and Tobago shipped 293,854 st, and Argentina added 7,166 st.

US Exports:

July-October ammonia exports totaled 467,813 st, down 3.1% from the year-ago 482,768 st. October exports rose 1.9%, however, to 64,886 st from 63,646 st in October 2022.

Morocco was the top export destination for July-October with 146,052 st, followed by Norway with 84,358 st. The Netherlands moved into third place with 49,384 st, ahead of 37,992 st to the UK.

Eastern Cornbelt:

CF on Dec. 13 announced fill and spring prepay programs for ammonia, with offers out of terminals in Illinois and Indiana dropping to $600/st FOB for December-February fill tons and $650/st FOB for spring prepay. Those levels are down $100/st or more from the last prompt fall business, which fell in the $725-$750/st FOB range in the region.

Western Cornbelt:

The first round of December-February fill and spring prepay programs for ammonia were announced by CF on Dec. 13. Postings in Nebraska at Aurora, Blair, and Fremont were reported at $620/st FOB for fill tons and $645/st FOB for spring prepay, while published prices at Port Neal and other Iowa terminals were pegged at $620/st FOB for fill and $640/st FOB for spring.

Southern Plains:

CF’s Dec. 13 fill and spring prepay prices for ammonia included Woodward, Okla., at $600/st FOB for December-February fill and $620/st FOB for spring, and Verdigris, Okla., at $625/st FOB for both fill tons and spring prepay. Those levels are down from the last prompt fall business in the $625-$675/st FOB range in the region, depending on location.

South Central:

The last confirmed truck offers for ammonia out of Gulf Coast production points ranged from $570-$625/st FOB.

India: 

Sources reported purchases of imported ammonia at $500/mt CFR, matching where traders previously estimated prices during a period of limited public spot business.

The lack of spot deals in India did not mean ammonia was not being imported. Most buying took place under long-term contracts that provided tons at a substantial discount to the spot market. Smaller buyers could often make do with domestically produced product, leaving few indicators for the price of imports.

Middle East: 

Based on reports of $500/mt CFR ammonia in India, estimated netbacks to the Arab Gulf showed up in the $420s/mt FOB, a level sources had discussed for several weeks. There were no spot deals to confirm the talk, however.

Northwest Europe:  

The decline in natural gas prices is expected to help ammonia producers step up production. These same producers appear reluctant to lower prices, however, even if supply increases.

The bulk of the deals into Northwest Europe are covered by contracts or formula-based sales. Sources reported a weak feeling to the market, and no new spot inquiries were reported.