All posts by hlancey@bloomberg.net

OCP to Build Four New Plants for Purified PhosAcid and Technical MAP

DAP/MAP, Featured, Lithium, Morocco, News, Phosphoric Acid

Morocco’s OCP Group SA plans to build four new plants to be completed by 2028 for the production of purified phosphoric acid (PPA) and technical MAP. OCP said the start of construction of the first PPA/technical MAP units is scheduled for the first half of 2024.

The new production facilities will be built within the group’s existing industrial platforms, with the first PPA and the technical MAP units targeting an equivalent annual production capacity of 120,000-150,00 mt/y P2O5, OCP said in an Aug. 17 media statement.

OCP said it is being assisted by JESA, the ongoing joint venture between the Moroccan phosphate group and Australian firm Worley, which it described as the African leader in design, engineering, and project delivery services.

“The project is part of OCP’s strategy to meet the growing demand for use of PPA and technical MAP as captive inputs in other products such as lithium iron phosphate (LFP) batteries and phosphate salts, as well as the growing needs of horticulture and water-stressed agriculture markets around the world,” the company said.

OCP added that the new capacities will also allow it to use the PPA and/or technical MAP produced in the new plants to manufacture other high-value niche products, “thus expanding OCP’s existing specialty phosphate business.”

Phospholutions Reports $10.15 Million Investment; Keytrade Joins as New Investor

Brazil, China, Featured, India, News, Phosphate, Turkey, U.S.

Phospholutions Inc., a sustainable fertilizer technology provider based in State College, Pa., has announced an additional $10.15 million investment from leading global fertilizer companies and investors to accelerate the commercialization of RhizoSorb® in the US row crop market.

The financing was led by Advantage Capital and includes continued investment from Conti Ventures (a division of Continental Grain Co.), Tekfen Ventures, Maumee Ventures, and Ben Franklin Technology Partners. Keytrade, a global fertilizer trader, also joins as a new investor.

“We are pleased to welcome new investors like Advantage and Keytrade supporting our efforts to accelerate commercialization of our phosphate efficiency technology,” said Jason Burke, Vice President of Finance for Phospholutions. “Additionally, the continued support from our existing investors really fortifies what we are doing to bring new sustainable fertilizers to the US farmer.”

“We are thrilled to engage in the advancement of the fertilizer industry and to invest in a company dedicated to shaping the future of phosphorus,” said Melih Keyman, Keytrade President and CEO. “This pioneering solution offers producers an opportunity to embrace sustainable technology and enhance conventional fertilizer production while also extending the value to the farmer, creating a more environmentally friendly and economically viable approach.”

Phospholutions said ‍RhizoSorb® is the only patented technology incorporated upstream into the production process for conventional phosphates that reliably reduces phosphorus applications by up to 50%, maintaining yield and improving retail margins while providing a cost savings benefit to the farmer.

The company said RhizoSorb® is proven to deliver the same amount of phosphorus to the plant with half the amount of applied fertilizer. RhizoSorb® 8-39-0 was launched in the US row crop market this past spring, and Phospholutions has added three new Regional Managers and a Director of Agronomy to support sales to ag retailers in North America.

Phospholutions said RhizoSorb has been proven to benefit farmers in five countries outside the US, including India, New Zealand, and Turkey, and it will be expanding field trials into China, Brazil, and Canada during the 2024 growing season.

The company said the technology has been proven to reduce the environmental impact of phosphate fertilizer by reducing runoff potential by 58%, leaching by 87%, and greenhouse gas emissions associated with conventional use of traditional MAP sources by more than half. It said phosphate manufacturers also see a reduction in production costs and an increase in margin that outweighs the reduction in applied volume per acre compared to conventional phosphate sources.

Phospholutions was recently awarded first place in the International Fertilizer Association’s African Agtech Startup Showcase, hosted in partnership with Mohammed VI Polytechnic University (UM6P). The competition was aimed at agtech startups working on innovative solutions that can be adapted to the African context to ensure the sustainability and inclusivity of its agriculture.

SQM 2Q Income Off on Lower Lithium Prices

China, Earnings, Lithium, News, Potassium Sulfate

SQM Inc. reported second-quarter net income of $580.2 million, down 32% from the year-ago $859.3 million, while revenues decreased 21%, to $2.05 billion from the year-ago $2.6 billion.

“Our second-quarter 2023 results were lower when compared to the same period last year primarily due to the lower realized average sales prices in the lithium business,” said CEO Ricardo Ramos. “While lithium sales volumes showed a significant recovery during this quarter, reaching historical high levels, lower spot prices especially in China in the beginning of the second quarter had a negative impact on reported sales and net income. We continue to see positive dynamic in (the) lithium market supported by strong EV sales volumes in different markets and expect the global lithium demand growth to reach at least 20% this year.”

SQM said second-quarter lithium sales volumes surpassed 43,000 mt, more than 26% higher than the year-ago quarter and 33% higher than the first quarter. Realized average sales prices, however, decreased almost 37% year-over-year and close to 33% compared to the first quarter.

Specialty Plant Nutrition (SPN) saw a second-quarter drop in both volumes and prices, though the company saw some demand recovery compared to the first quarter. However, due to lower first-quarter demand and some reduced agricultural activity as a result of the impact of climate conditions in various markets, SQM expects annual SPN demand growth to be flat-to-negative in 2023.

Second-quarter SPN volumes were off 4%, to 221,700 mt from the year-ago 230,100 mt, while revenues fell 25%, to $247.5 million from $330.3 million. Potassium nitrate-based volumes were off 11%, while Specialty Blends saw a volume increase of 8%.

Second-quarter sales volumes and prices were down for Potassium Chloride and Potassium Sulfate (MOP/SOP). Average sales prices were off 48% year-over-year and almost 16% when compared to the first quarter. However, SQM believes the price decrease could have a positive impact on global potash market demand, resulting in a growth of approximately 10% this year compared to 2022. It expects potassium sales volumes could surpass 500,000 mt in 2023.

Second-quarter MOP/SOP volumes dropped 30%, to 124,300 mt from the year-ago 177,600 mt, while revenues fell 64%, to $66.2 million from $182.4 million.

Company-wide, SQM reported six-month net income of $1.33 billion, down 20% from the year-ago $1.66 billion. Six-month revenues were off 7%, to $4.32 billion from $4.62 billion.

Six-month SPN volumes were down 12%, to 389,800 mt from the year-ago 440,800 mt, while revenues dropped 23%, to $468.4 million from $605.6 million. Potassium nitrate-based products saw the biggest drop at 19%, while Specialty Blends were down 6%.

Six-month MOP/SOP volumes were off 18%, to 262,800 mt from the year-ago 319,300 mt, while revenues were off 48%, to $153.1 million from $296.5 million.

Lower Prices, Higher Costs Hit Ma’aden 2Q/IH

Earnings, News, Phosphate, Saudi Arabia

Riyadh-based Saudi Arabian Mining Co. (Ma’aden) reported a 91% drop in net profit after Zakat and tax for the second quarter, to SAR350.9 million (approximately $93.5 million at current exchange rates) from SAR4.03 billion the previous year. Revenue declined 41%, to SAR6.97 billion from SAR11.88 billion.

Ma’aden cited lower selling prices versus a record year in FY2022, and higher costs, which were partially offset by higher sales volumes for aluminum, flat rolled products, and all products except ammonia.

The company said the second quarter was a “record” for phosphate production as it pursues production growth. However, it did not provide any volume data.

For the half-year, Ma’aden posted an 88% drop in net profit after Zakat and tax, to SAR770.4 million on revenue of SAR15.01 billion, down from last year’s SAR6.2 billion and SAR20.79 billion, respectively. Revenue declined 28% year-over-year. Six-month profit per share was SAR0.21 versus the year-ago SAR1.68.

Ma’aden said its financial position has further strengthened with reductions in long-term borrowings and net debt as of June 30, 2023, down by 11% and 9%, respectively, from December 2022, including the early debt repayment of SAR3 billion by Ma’aden Wa’ad Al Shamal Phosphate Company (MWSPC).

Early this month, Manara Minerals, a joint venture between Ma’aden and Saudi Arabia’s Public Investment Fund (PIF), inked a binding agreement to acquire a 10% stake in Brazilian group Vale SA’s base metals unit, Base Metals Ltd. (GM Aug. 4, p. 35). The Vale base metals unit produces nickel and copper. The transaction is based on an enterprise value of $26 billion, according to Ma’aden.

Manitoba Funds Study of New Trade Corridor

Canada, Natural Gas, News, News Briefs, Potash

The Manitoba government on Aug. 3 said it is providing $6.7 million over the next two years to study the feasibility of the Indigenous-led NeeStaNan Utility Corridor project. The study will assess the viability and level of investment required to establish a trade corridor from Fort McMurray, Alta., to the Hudson Bay Coast of Manitoba, where products could continue through the Arctic.

The total cost of the feasibility study is $26.6 million, with the Manitoba government providing $6.7 million over two years, contingent on funding participation from the governments of Alberta and Saskatchewan, as well as First Nations communities. The three provinces signed a Memorandum of Understanding (MOU) in April to advance economic corridors and support the movement of products within Western Canada and to various markets.

“This vision of this project is to create an Indigenous-owned corridor connecting Manitoba with other Prairie provinces and support economic development in northern Manitoba,” said Manitoba Transportation and Infrastructure Minister Doyle Piwniuk. “Strategic transportation investments are a priority to develop and grow Manitoba’s trade capability and trade market access.”

NeeStaNan would be 100% Indigenous-owned and governed by a Board of Directors. The plan would build a second deepwater port on Hudson Bay near a long-abandoned settlement near the mouth of the Nelson River, according to the Winnipeg Free Press.

The federal government began construction of the infrastructure for Port Nelson over a century ago, but halted construction due to labor and material shortages during World War I. A later evaluation instead chose the deepwater option of the Port of Churchill, hundreds of kilometers to the northwest, which was completed in 1931.

Piwniuk told CBC News that the new project would relegate the Port of Churchill to a regional supply hub rather than as an international port.

NeeStaNan backers say key commodities such as potash, natural gas, wheat, bitumen, and other critical minerals are landlocked in Western Canada, and transported via rail or pipeline through the Rocky Mountains to the West Coast to reach international markets. If built, the NeeStaNan project would reduce shipping distances by 3,500-5,500 kilometers from existing transportation routes to Europe, the US Gulf Coast, and South America, while delivering economic, environmental, and social benefits to First Nation communities.

Consideration of the corridor would explore the potential for bulk cargo shipments via rail and pipeline development to support the future export of liquefied natural gas, interprovincial high-voltage direct current power lines, and communication lines, as well as the expanded port facilities required for the enhanced shipment of mineral and agricultural commodities.

Dawson Celebrates Fertilizer Facility Upgrade

News, News Briefs

A grand opening ceremony was held on Aug. 15 by Dawson Co-operative Union, Dawson Creek, B.C., to celebrate the completion and operation of the new fertilizer shed and distribution facility at the Rolla Ag site.

The new state-of-the-art upgraded fertilizer plant has a storage capacity of 6,000 mt and can blend product at speeds of up to 280 mt/h, almost five times faster than the previous bin system plant that was acquired in 2017.  

“We are very proud and excited to see the full potential of these facility upgrades as they will continue to contribute to the long-term economic success of our local farmers by providing enhanced efficiencies and services in the delivery of our full offering of fertilizer and crop inputs,” said Rod Hillary, Dawson CEO.

Founded in 1921, the co-op has British Columbia locations in Dawson Creek, Rolla, Tumbler Ridge, and Chetwynd.

Mosaic Unveils Plant Health Platform

News, News Briefs

The Mosaic Co. on Aug. 15 announced the formation of the Mosaic Bioscience™ platform, which it says will bring the latest plant health science and innovation to the agricultural market. It said the technologies will enhance crop health and support the natural biology in plants and soil, ultimately enhancing yield.

“Mosaic Biosciences is a natural extension of our strong crop nutrition portfolio,” said Floris Bielders, Mosaic Vice President, Strategy and New Business Platforms. “Rooted in science and proven in the field, our portfolio of biological technologies supports the existing biology in plants and soil to deliver healthier, stronger crops.”

The portfolio includes biological fertilizer complements PowerCoat® and BioPath®, which improve nutrient use efficiency and enhance plant growth. Mosaic said a global team of scientists is building a pipeline of new biologic products to drive improvements in plant health, stress management, nutrient uptake, and crop yield.

“Our portfolio of nutrient use enhancement technologies is just the start for Mosaic BioSciences,” Bielders said. “In the coming months and years, we expect to bring additional biological products to the market, all of which will be backed by science and in-field experience. Biologicals are crucial in the evolution of crop nutrition and will elevate the potential in every field.”

Acron Commissions Second Granular Urea Unit

News, News Briefs, Russia, Urea

Russian fertilizer producer Acron Group has commissioned a second urea granulation unit at its Veliky Novgorod site in northwest Russia. The $65 million project was announced in late 2021 (GM Dec. 3, 2021).

Once fully operational, the 700,000 mt/y unit will take the Russian fertilizer group’s total commercial granular and prilled urea production capability to 2.1 million mt/y, Acron said in a Aug. 15 statement. The group is already the largest urea producer in Europe.

Acron launched its first urea granulation unit, also with 700,000 mt/y capacity, in May 2020 (GM May 22, 2020). Before that, the company had only produced urea that was prilled or rotoform. With the commissioning of the second facility, Acron has a total capacity of 1.4 million mt/y of granular urea and 700,000 mt/y of prilled urea.

The new granulation facility is part of a $1.5 billion capital investment program for 2023-2025 for the modernization and expansion of production, the company said. The other main projects under the program are the construction of the Talitsky potash mine in Russia’s Perm region and the reconstruction of the Ammonia-2 and Ammonia-3 units at the Veliky Novgorod site.

Acron reported in March that its Verkhnekamsk Potash Co. (VPC) subsidiary had completed the construction of the skip and cage shafts at the Talitsky potash mine project (GM March 10, p. 29). When completed, Talitsky will have an initial capacity of 2 million mt/y of potassium chloride, with the potential for further expansion to 2.6 million mt/y.

Petrobras Eyes First-Half 2024 ANSA Restart

Ammonia, Brazil, News, News Briefs

Brazil’s Petrobras is in the final stages of studies for the resumption of fertilizer production at Araucária Nitrogenados (ANSA), a subsidiary in Parana state, the company said in a filing, according to a recent Bloomberg report.

The plant has been shut since 2020 “and, after investments and adjustments to meet regulatory standards, it may resume operations in the first half of 2024,” according to the filing. Petrobras said that after finalizing the technical and economic feasibility studies, the resumption project will be submitted for approval by the company’s Executive Board and Board of Directors.

ANSA has the capacity to process about 1,900 mt/d of urea and 1,300 mt/d of ammonia. The company says the raw material used in the unit is asphalt residue, which can be obtained from the Presidente Getúlio Vargas Refinery (Repar), located in the city of Araucária, Paraná.

Univar, Apollo Complete Transaction

ADNOC - Abu Dhabi, News, News Briefs

Univar Solutions Inc. and Apollo announced on Aug. 1 that Apollo Funds have completed the previously announced $8.1 billion acquisition of Univar (GM March 24, p. 1), which includes a minority investment from a wholly owned subsidiary of the Abu Dhabi Investment Authority.

The company will continue to operate under the Univar Solutions name and brand and maintain its global presence.

“The completion of this transaction begins the next chapter for Univar Solutions as we further enhance our position as a leading global chemical and ingredients solutions provider with enhanced flexibility to explore growth opportunities for the benefit of customers, suppliers, employees, and industry alike,” said Univar CEO David Jukes.

An Apollo Funds affiliate acquired all of the outstanding shares of Univar stock. Shareholders are entitled to receive $36.15 in cash for each share of Univar common stock owned. As a result of the transaction completion, Univar common stock no longer trades on the New York Stock Exchange.