Eastern Cornbelt:
Potassium thiosulfate remained at $780/st FOB Terre Haute, Ind., for the last confirmed offers.
All posts by mickeybarb@charter.net
Crops/Weather
Eastern Cornbelt:
A winter weather advisory was posted for central Illinois on Nov. 15, with reports of 1-3 inches of snow accumulation across the region. Scattered flurries returned to central Illinois on Nov. 17-18, along with cold temperatures. Highs struggled to reach the upper-30s as the week ended, and wind chills dropped to the single digits and teens in many areas.
Similar conditions were reported in Indiana, with up to three inches of snow blanketing the Indianapolis area and temperatures ranging from the low-20s to mid-30s. In northern Ohio, lake effect snow showers were expected to deposit 6-9 inches across a wide area by late in the week, with a foot or more possible in some locations.
Growers were putting the finishing touches on the fall harvest in mid-November. The corn harvest as of Nov. 13 was 94% complete in Illinois, 91% in Indiana, and 87% in Ohio, while the soybean harvest had progressed to 96-98% complete in the region. Progress was ahead of the five-year average for both crops in all three states. Winter wheat planting was reported at 95-99% complete in the region by Nov. 13.
Western Cornbelt:
Winter weather conditions moved into much of the Western Cornbelt during the week. Central Iowa was hit with 1-3 inches of snow as the week began, with higher amounts reported in some northern areas of the state. Temperatures in Iowa were expected to top out in the 20s by the weekend.
Snow flurries also worked their way through Nebraska during the week, with highs reaching the 30s through Nov. 17. Temperatures on Nov. 18 struggled to make it out of the 20s, however, with wind chills falling to the single digits in central and eastern areas of the state, and dropping to subzero lows in western Nebraska.
Northern and central Missouri were also blanketed with several inches of snow on Nov. 15, with up to four inches reported at Kirksville and Moberly.
The corn harvest as of Nov. 13 was 94-95% complete in the Western Cornbelt, with the soybean harvest reported at 92-100% complete. Missouri’s cotton crop was 93% harvested by that date, along with 93% of Nebraska’s sorghum crop. Harvest progress continued to track ahead of the average pace for all crops in all three states.
Northern Plains:
Minnesota experienced light but persistent snowfall throughout the week, with a blast of arctic air moving into the region on Nov. 17. Temperatures across the state were expected to fall to the low single digits over the coming weekend, with subzero wind chills in many areas.
A powerful winter storm in mid-November blanketed much of North Dakota in 15-24 inches of snow, putting a rapid halt to fall ammonia movement in the state. A winter weather advisory was posted for parts of South Dakota on Nov. 17 warning of snow flurries and single digit temperatures across the state.
“It’s cold and nasty here,” commented one North Dakota source at midweek. “We are in full winter mode.” Added another source: “We are buried under about 24 inches of snow in most of the state and are about 10 degrees, so fall has slammed shut as of last Thursday.”
Fortunately the region’s fall harvest was virtual complete by mid-November. Fully 96% of the corn and 100% of the soybeans were already in the bin by Nov. 13, along with 100% of the sugar beets and 96% of South Dakota’s sorghum crop. The sunflower harvest in the Dakotas was 91-93% complete by that date. Harvest progress on all crops was ahead of the average pace.
Northeast:
Highs in the mid-40s were reported across New England, with rain along coastal areas and some northern areas picking up a dusting of snow at midweek.
Western New York was bracing for 2-3 feet of snow over the coming weekend, with Buffalo expecting three feet of fresh accumulation. Snow flurries at midweek left an inch or two of snow in northeastern and central Pennsylvania, while warmer weather was reported in Maryland, with highs reaching the upper-40s and low-50s during the week.
Wet weather continued to slow the fall harvest in the region. Pennsylvania’s corn harvest was just 65% complete by Nov. 13, trailing the 73% five-year average.
Eastern Canada:
Snow flurries and windy weather were reported across Ontario as the week progressed, while much of southern Quebec experienced whiteout conditions at midweek and up to 20 cm of snow accumulation in some areas.
A mix of snow, ice, and rain hit the Maritimes on Nov. 16-17. While parts of northern New Brunswick picked up 15-30 cm of snow, Prince Edward Island collected only 2-5 cm. Nova Scotia was hit with mostly rain, although some snow was reported in the Cape Breton Highlands.
Most of the fall harvest was complete in Eastern Canada, and sources reported a “pretty good run” underway on fall fertilizer movement. “We’re having a bit of a slowdown now,” commented one Ontario source. “We got our first big snowfall last night and we are below freezing, so the snow might stay around.”
Transportation
US Gulf:
Navigation through Harvey Lock has remained unavailable since Oct. 2 due to low water conditions on the lower Mississippi River.
A Bayou Sorrel Lock guidewall replacement project currently in progress is slated to continue into March 2023, prompting irregular lock shutdowns between 6:30 a.m. and 5:00 p.m., Monday through Friday. The lock returned to normal navigation hours on Saturday and Sunday. Delays were posted at 3-4 days on Nov. 14.
On the Atchafalaya River, commercial navigation was completely shut through Little Island Pass, Middle Island Pass, and Riverside Pass due to the presence of exposed underwater pipelines. Detours were possible via the Port Allen Route.
Length and width restrictions for tows passing Algiers Lock reportedly limited unassisted lockages to four standard barges or two 30,000 mt tankers per turn. Tows locking with an assist tug were permitted longer strings, sources said. Waits were reported up to 11 hours early in the week.
Bayou Boeuf Lock delays were reported at 2-3 days, while wait times at Colorado Lock were noted at four days on Nov. 14. Boats passing Brazos Lock saw delays up to 11 hours, while Leland Bowman Lock wait times were observed at 3-4 days.
Mississippi River:
Low water levels continued to impact shipping on the lower Mississippi River during the week, although recent rains gave a partial reprieve.
Depths were at (-)4.11 feet and rising at Memphis, Tenn., on Nov. 16, and were projected to crest at 0.7 feet on Nov. 20-21 before receding to (-)3.7 feet on Nov. 30. The Vicksburg, Miss., gauge was reported at 3.06 feet on Nov. 16, and was expected to reach an 8.3-foot peak on Nov. 24-25 before dropping to 6.7 feet on Nov. 30. The St. Louis gauge was reported at 2.97 feet on Nov. 16, but was projected to fall below the 0.0-foot mark on Nov. 26.
Draft restrictions continued to hold at 9.0 feet in both the northbound and southbound directions for solid cargoes, while liquid cargoes were steady at a maximum 8.5 feet of draft. Draft limits were further reduced to as little as 7.0 feet at some docks and harbors, sources said.
Vessels traveling in the southbound direction saw barge limits restricted to 25 cargoes, down from the typical 30-40 barges. Per-vessel capacity continued to be cut by up to 50% or more compared to normal levels, sources said.
Dredging at Stack Island, located at Miles 485-486, was scheduled to end on Nov. 14. The project had triggered navigation stoppages lasting up to 48 hours at a time.
A revetment operation at Mile 344 was expected to wrap up on Nov. 17 before moving to Mile 336. Work at the new location was likely to block travel from 6:00 a.m. to 6:00 p.m. daily on Nov. 17-25.
Ongoing repairs to the I-10 Bridge triggered a blanket safety advisory at Miles 228-230. Old River Lock was scheduled to reopen on Nov. 13, restoring direct access to the Red River.
On the upper river, low water levels held drafts to 9.0 feet in the St. Louis Harbor, although barges with corners below 9.5 feet were permitted to move through the area. Dredging continued at the upper river’s Mile 184, prompting delays up to 24 hours at the Chain of Rocks Lock on Nov. 13-14. Work was expected to conclude on Nov. 14.
Illinois River:
Dredging began on Nov. 11 at Miles 215-216, in the Clark Island area. Work was scheduled to run 24 hours per day until further notice. Dredging also kicking off at Mile 144.5 on Nov. 14, and will run 6:00 a.m. to 6:00 p.m. daily until further notice, a Corps notice indicated.
The Corps established a safety zone at Miles 19.5-21 on Nov. 14-18 due to power line work in the area.
Ohio River:
Low water levels on the Ohio River continued to require 9-foot draft restrictions for the full lengths of the Ohio River, Tennessee River, and Cumberland River.
Dredging was reported in the Mound City, Mo., area, located at Miles 965-974 of the Ohio River. The operation was reportedly aimed at gaining one extra foot of travel clearance at Cairo, Ill.
The Cannelton Lock main chamber reopened from a miter gate replacement operation on Nov. 11, ending a period of wait times delaying tows for up to 54 hours at a time. Delays lingered in the 4-19 hour range through Nov. 15, according to Corps data.
The primary chamber at Montgomery Lock is shut through Dec. 16 for repairs and maintenance, forcing traffic through the secondary chamber. Delays were reported at 4-7 days during the week, rising from 2-4 days reported previously.
Arkansas River:
Norrell Lock repairs were scheduled to block daylight-hour navigation at the site through an estimated Nov. 20, stopping traffic daily between 7:00 a.m. and 7:00 p.m., while tow widths were capped at 70 feet on overnight lockages. The site will undergo a complete shutdown on Jan. 30-31, 2023.
Oerth Bio, Yara to Collaborate
Oerth Bio, Durham, N.C., an agricultural biotechnology company targeting protein degraders in plants, and Yara International ASA announced on Nov. 15 a collaboration applying Oerth’s protein degrader technology to crop efficiency applications.
The collaboration will focus on boosting plant resilience to combat escalating climate stress impacting crop production and farm economics. The companies will co-develop products to improve nutrient use efficiency and strengthen plant resilience to climate change.
“This collaboration will catapult Yara’s competitive footprint, offering farmers plant nutrition solutions specifically targeting plant resilience and improved crop quality – setting a new sustainable agriculture paradigm,” said Markus Himken, Yara Senior Vice President of Agronomy and R&D.
The core technology driving Oerth Bio is PROTAC Molecules (PROteolysis Targeting Chimeras) – biologically enabled molecules designed to induce the modulation of specific proteins via the ubiquitin proteasome system. Each region of the PROTAC molecule plays a role in its specificity and potency.
Incitec Pivot Posts Record Annual Profit
Incitec Pivot Ltd. (IPL) reported a net income after tax (NPAT) for the full year ended Sept. 30, 2022, of A$1.01 billion (approximately US$681.9 million at current exchange rates), versus A$149.1 million for the previous year, essentially meeting the average analyst estimate of A1.02 billion (Bloomberg Consensus).
NPAT before individually significant items (IMIs) came in 186% up year-over-year at A$1.03 billion, compared with FY2021’s A$358.6 million.
EBIT excluding IMIs increased 162% to A$1.49 billion, up from A$566.4 million the previous year, beating the average analyst estimate of A$1.47 billion (Bloomberg Consensus).
Full-year revenue grew 45% year-over-year to A$6.32 billion, up from FY2021 A$4.35 billion.
IPL’s Fertilisers Asia Pacific business reported a 129% rise in EBIT to A$613.7 million, up from A$268.4 million the previous year.
The division’s Manufacturing segment more than doubled its earnings during the year, to A$563.1 million from A$208.8 million. This was despite the Phosphate Hill, Queensland, operation undergoing a major planned turnaround that started in early May 2022 and was completed in the second half of the fiscal year. The company noted the turnaround negatively impacted earnings by A$74 million compared with FY2021.
Ammonium phosphate production at Phosphate Hill decreased 23% as a result of the turnaround, as well as due to some critical pieces of equipment operating at below capacity leading into the turnaround. Output fell to 735,900 mt, down from 958,400 mt the previous year.
Total volumes sold from Phosphate Hill declined 21% to 747,000 mt, down from the prior year 949,000 mt.
However, for FY2023, IPL expects Phosphate Hill to increase ammonium phosphate volumes to around 1 million mt.
The Gibson Island plant in Brisbane, Queensland, produced 404,500 mt of urea equivalent product in the year under review, some 19% less than the previous year’s 498,500 mt. IPL cited various minor equipment failures and inefficiencies as mainly causing the reduced production, with the majority of the issues now having been addressed.
Some 336,000 mt of urea product was sold from the plant during the year, versus 364,000 mt in FY2021. IPL confirmed the plant remains on track to close at the end of this calendar year.
The company reported Distribution volumes were lower as a result of lower demand, largely due to higher pricing, wet weather, and global fertilizer supply constraints.
Fertilisers APAC total fertilizer volumes sold fell by 20% year-over-year to 2.576 million mt, down from 3.220 million mt, while domestic Fertilisers APAC volumes sold declined by 16%, to 1.869 million mt from 2.235 million mt.
Dyno Nobel Americas (DNA) saw EBIT jump to US$532.8 million from the previous year’s US$141.2 million. IPL attributed the earnings boost to a continued uptake of premium technology underpinning “excellent” volume growth in Quarrying and Construction, as well as strong second-half fiscal year manufacturing performance capturing favorable commodity markets.
IPL highlighted the recovery in Waggaman, La., earnings in FY2022, with the operation posting an EBIT of US$343.8 million, compared with just US$3.6 million in the previous year.
Waggaman produced 60% more ammonia year-over-year in FY2022, with output reaching 700,600 mt versus 437,200 mt in the previous year. Ammonia volumes sold increased 32% to 745,900 mt, up from 563,500 mt.
The Cheyenne, Wyo., ammonia operation recovered from unplanned outages in FY2021, with ammonia output up 3% year-over-year. IPL reported that the fourth major turnaround at Cheyenne of the ammonia plant will start in the third quarter of FY2023.
At the St Helens, Ore., plant, urea and ammonia production increased 25% and 28%, respectively, year-over-year, with IPL noting plant production was slightly above expectations post turnaround.
IPL said it is also looking at small debottlenecks at both its Cheyenne and Louisiana, Mo., operations. Overall production at the latter operation was up 16% year-over-year in FY2022.
IPL’s Dyno Nobel Asia Pacific (DNAP) division posted a 16% increase in EBIT to A$162.5 million versus the year-ago A$140.2 million, with IPL citing customer growth and solid take-up of Dyno’s premium technology solutions.
IPL’s Board announced a fully franked final dividend of A$0.17 per share. This compares with A$0.083 a share a year ago.
This year’s final dividends brings the total dividend for FY2022 to 27 Australian cents per share. The 27 cents per share total dividend for the year represents a full-year payout ratio of 51% and a total dividend of A$524 million for FY2022.
Incitec Pivot Announces A$400 M Buyback
Incitec Pivot Ltd.’s (IPL) Board has approved an on-market share buyback of up to A$400 million (approximately US$270 million at current exchange rates) to be conducted over the next 12 months, the company said on Nov. 15.
It said it has sufficient cash reserves and committed bank facilities to complete the buyback.
IPL said the buyback will be conducted in the ordinary course of trading, and the exact amount and timing will be dependent on regulatory requirements and market conditions. The company’s shares jumped as much as 10%, the most in a year, following the announcement of the share buyback plan, Bloomberg reported.
Incitec Pivot Provides More Color on Saudi TAN JV
Incitec Pivot Ltd. (IPL) clarified at an FY2022 earnings call on Nov. 15 that it sees its recently-announced joint venture signing with Saudi Arabian firm Modern Chemicals Co. (MCC) to develop a Technical Ammonium Nitrate (TAN) Plant at Ras Al Khair Industrial City, in Saudi Arabia’s Eastern Province (GM Nov. 4, p. 35), as a “low capital, high return” type project.
Riyadh-based MCC is developing a 300,000 mt/y TAN production plant in Ras Al Khair Industrial City.
“Our main interest is to get advantage offtake to support our growth agenda in Europe,” IPL Managing Director and CEO Jeanne Johns told analysts at the earnings call.
She said IPL is not looking to participate in the Middle East market, rather that the company is looking at “a facility that has deepwater access, has advantaged ammonia based on its proximity to some of the cheapest gas reserves in the world, and provides a growth platform internationally for IPL.”
Johns said the negotiation process as to what IPL and MCC bring to the jv are still underway. The original announcement of the jv signing indicated the TAN output from the plant would be targeted to the Saudi Arabian and regional mining sectors.
Turkey’s Yildirim to Acquire 55% Stake in Croatia’s Petrokemija
Turkey’s Yildirim Holding AS has signed an agreement with Croatian oil and gas group ING d.d. and Croatian gas company Prvo Plinarsko Društvo to acquire Terra Mineralna Gnojiva company (TMG), which holds a 54.517% stake in Croatian fertilizer producer Petrokemija d.d., Petrokemija said on its website.
Istanbul-based Yildirim Holding submitted a bid in January to TMG and Petrokemija’s other shareholders to acquire the fertilizer company (GM Jan. 14, p. 30). TMG is a joint venture of INA and Prvo Plinarsko Društvo.
“The process of changing ownership of TMG company in Petrokemija began with the signing of the share sales agreement with Turkey’s Yildirim Group,” INA said in a filing to the Zagreb bourse, as cited by a SeeNews report, and also confirmed by the Petrokemija website statement.
The change in ownership and the completion of this process will occur after the conditions of the sales contract are met, according to the statement, but no further elaboration was provided by the Croatian fertilizer company. Nor has the value of the proposed transaction been disclosed.
Kutina-based Petrokemija is Croatia’s only mineral fertilizer producer. Its nitrogen fertilizer production capacity includes 0.45 million mt/y of ammonia, 0.31 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.
Petrokemija stopped production earlier this year due to high natural gas prices, but according to the company it has made no employee terminations and salaries have continued to be paid.
Petrokemija in March delisted from the Zagreb Stock Exchange after its shareholders approved a proposal for the delisting (GM March 4, p. 31).
The company’s other shareholders include CERP, Croatia’s state-owned fund for enterprise restructuring and privatization, with a 17.9% stake. CERP in June offered for sale its entire interest in Petrokemija (GM June 10, p. 27). It was offering its 9,852,828 shares at a starting price of 305.4 million kuna (approximately $42 million at current exchange rates).
But it is unclear what progress CERP has made in the sale of its shares. Certainly, in its website statement, Petrokemija continues to list CERP as a shareholder in the company with a 17.9% stake.
Yildirim Holding also looks set to acquire Belgian fertilizer firm Rosier SA from Vienna-based fertilizers and polyolefins major Borealis AG.
Yildirim and Borealis in September inked a binding agreement for the Turkish company to acquire all of Borealis’ 98.09% stake in Rosier (GM Sept. 30, p. 30). Earlier this month, the two signed a binding agreement for Yilfert Holding to launch a mandatory takeover bid, followed by a squeeze-out, for Rosier (GM Nov. 11, p. 32).
The privately-owned Yildirim Group is a Turkish industrial conglomerate active in nine industrial sectors, including fertilizers and chemicals. It owns Turkish fertilizer producer Gemlik Gübre AŞ and is Turkey’s largest producer and exporter of CAN. It is also an ammonia producer, and is Turkey’s third largest trader of fertilizers (CAN, AN, DAP, AS, NPK, and urea).
Higher Gas Prices hit Grupa Azoty 3Q
Polish fertilizers and chemicals producer Grupa Azoty SA confirmed a Pln79.4 million (approximately $17.48 million at current exchange rates) net loss for the third quarter ended Sept. 30, 2022, and an 11% decline in EBITDA in line with the preliminary figure (GM Nov. 4, p. 32) to Pln266.6 million, according to the company’s third-quarter financial statement.
The third-quarter net loss compared with a net profit of Pln14 million and an EBITDA of Pln300.2 million for the same year ago period. Revenue increased by 63% to Pln6.31 billion, up from Pln3.88 billion the previous year.
Azoty said the financial results were driven primarily by the impact of Russia’s invasion of Ukraine and an unprecedented rise in the price of natural gas as the key feedstock used in fertilizer production.
It said the key negative driver of the group’s performance was production cuts due to high feedstock prices that resulted in lower sales volumes.
Azoty noted gas prices hit all-time highs this past August, which resulted in the decision to temporarily curtail production at some of the group companies’ plants in Tarnów, Puławy, and Kędzierzyn-Kožle (GM Aug. 26, p. 1).
Fertilizer production was resumed by the group companies in October (GM Oct. 28, p. 29; Oct. 14, p. 28).
The Fertilizers/Agro business segment – the group’s biggest segment in terms of turnover – posted a 228% jump in third-quarter EBITDA to Pln62.2 million, up from the year-ago Pln18.97 million. Segment revenue increased by 87% year-over-year to Pln3.94 billion, up from Pln2.11 billion.
Following the restart of fertilizer production, Azoty and Puławy have offered their customers “much lower prices” for nitrogen fertilizers, indicating prices “significantly below the Pln4,000 per mt mark are what the market expects, allowing the continuation of economically viable agricultural production” (GM Oct. 21, p. 31).
For the nine-months to Sept. 30, 2022, Azoty reported a jump in net profit to Pln1.6 billion on revenues of Pln19.55 billion, up from the same prior-year period Pln267.69 million and Pln10.42 billion, respectively.
Nine-months EBITDA rose by 165% to Pln2.84 billion, up from the same year-ago period Pln1.07 billion.
EU Court Rejects EuroChem Appeal to Lift AD Duties on UAN; EC to Keep Duties
The European Union (EU) General Court has dismissed EuroChem Group AG’s suit to lift definitive antidumping duties on urea ammonium nitrate (UAN) from Russia, Interfax has reported.
The plaintiffs were EuroChem nitrogen fertilizer subsidiaries Nevinnomysskiy Azot and Novomoskovskiy Azot.
The EU imposed definitive antidumping duties on UAN imported into its member countries from Russia, the US, and Trinidad and Tobago in October 2019 (GM Oct. 11, 2019). The imposition of definitive measures followed provisional measures that were imposed in April of that year (GM April 12, 2019).
The duties were imposed for period of five years and for the two EuroChem subsidiaries amounted to €27.77/mt, and €42.47/mt for PJSC Acron and all other Russian companies except the two EuroChem companies.
The EU General Court made a similar decision with regard to an action filed by Trinidad and Tobago UAN producer Methanol Holdings (Trinidad) Ltd., appealing the antidumping duties. The duties imposed for Methanol Holdings amounted to €22.24/mt, and the same level was applied to all other Trinidad and Tobago companies.
Late last month, the European Commission reached the decision not to suspend the definitive antidumping duties on imports of mixtures of UAN originating in Russia, Trinidad and Tobago, and the US, despite “a temporary change in market conditions.”
In the EU ‘s Official Journal, the Commission noted there is an insufficient supply of UAN currently on the EU market at affordable prices to meet the steady demand. It noted that this is mainly because imports of UAN have decreased significantly and EU producers cannot fully compensate for the lost import volumes, “because of a large increase in the cost of production,” due to the current record-high natural gas prices.
The Commission noted that as acknowledged by EU producers, under current market conditions, the EU industry is unable to produce and sell UAN at a profit, and thus a significant part of its production capacity is idle.
It reported there are also indications that suspension would aggravate further the situation of the EU industry.
“Dumped imports at low prices from the countries concerned, notably Trinidad and Tobago, would lead to further pressure on the EU industry’s prices and the ensuing risk of a price erosion on the EU market,” it said.
In reaching its decision, the Commission said “it could not conclude that market conditions had temporarily changed to an extent that injury would be unlikely to resume as a result of a suspension of the antidumping duties.”