All posts by mickeybarb@charter.net

Canadian Ag Groups Urge Removal of Russian Fertilizer Tariff, Seek Compensation for Growers

Canada, Featured, News, Nitrogen, Russia

A coalition of farm groups, trade associations, and several crop input businesses in Canada are calling on the federal government to provide compensation to farmers in Eastern Canada who they said were negatively impacted by federal government-imposed tariffs on imported Russian fertilizer this spring (GM March 18, p. 1).

The group is also seeking the removal of tariffs in time for the fall application season and planning for 2023, according to a July 18 press release. The companies and associations listed in the announcement include Fertilizer Canada, the Ontario Agri Business Association (OABA), Sollio Agriculture, Sylvite Agri-Services, Atlantic Grains Council, Grain Farmers of Ontario, Ontario Bean Growers, Ontario Canola Growers, Christian Farmers Federation of Ontario, and Quebec Grain Farmers.

“Fertilizer is the most important input for ensuring strong, hearty yields,” said Karen Proud, President and CEO of Fertilizer Canada. “We need to support our growers and the industry needs predictability for the 2023 growing seasons as the planning is happening now. Now, more than ever, the world needs more Canada.”

The Canadian government on March 3 implemented a 35% tariff on all Russian imports, including fertilizer, in response to Russia’s invasion of Ukraine and as part of Canada’s decision to withdraw the most-favored-nation status to Russia and Belarus as trading partners. The tariff was not applied to products that were in transit prior to March 2, 2022.

“This was done without any prior consultation with the agriculture sector, and as a result, Eastern Canadian farmers were disproportionately impacted,” the group states, noting that approximately 660,000-680,000 mt/y of nitrogen fertilizer is imported from Russia to Eastern Canada. This amount represents between 85-90% of the total nitrogen fertilizer used in the region.

“The war in Ukraine has added considerable strain to global food security and Canada’s agriculture industry is well-positioned to help, but farmers’ ability to do this relies on a secure, predictable supply of fertilizer to maximize crop yields,” the group said. “Our industry strongly supports the people of Ukraine and condemns the Russian invasion. We also support sanctions and other measures imposed by the Canadian government and our allies aimed at quickly ending the war. However, action by the Canadian government should not jeopardize Canada’s capacity to produce food today or in the future.”

According to the statement, Canada is the only G7 country that has tariffs on Russian fertilizer, placing Canada’s agricultural industry at a “competitive disadvantage” to other countries around the world.

“Farmers bore the costs of tariffs, which has put Canadian farmers at a disadvantage to farmers in other countries who did not have tariffs on fertilizers,” said Christian Overbeek, Chairman of Québec Grain Farmers. “We need compensation for farmers and concrete solutions for the 2023 planting season in place this summer.”

According to OABA Executive Director Russel Hurst, as reported by Syngenta Canada, the tariff in most cases was initially paid by fertilizer importers, but then passed down the distribution chain, ultimately hitting farmers. Depending on how much spring tonnage was prepaid, Hurst estimated the tariff added C$150-$180 million in input cost, with most of that expense falling on Ontario producers, and about a third hitting growers in Quebec and the Maritimes.

Hurst said fall fertilizer supplies for Ontario are now essentially in place, but the 35% tariff will continue to be applied to any Russian product. “The fall planting season is quickly approaching, as well as procurement preparations for 2023,” he said. “Compensation for growers and predictability for industry will be important in the coming months as Canada’s agriculture industry steps up to do our part in this global crisis.”

Nutrien to Acquire Brazilian Ag Retailer Casa do Adubo

Brazil, Featured, News, Saskatchewan

Nutrien Ltd. announced on July 20 that it has entered into an agreement to acquire Brazilian company Casa do Adubo S.A. (Casa do Adubo). The acquisition includes 39 retail locations under the brand Casa do Adubo, and 10 distribution centers under the brand Agrodistribuidor Casal, all located in the states of Acre, Bahia, Espírito Santo, Maranhão, Mato Grosso, Minas Gerais, Pará, Rio de Janeiro, Rondônia, São Paulo, and Tocantins.

Terms of the deal were not disclosed, but Nutrien said the transaction supports its Retail growth strategy in Brazil and is expected to result in additional run-rate sales of approximately US$400 million, increasing total Nutrien Ag Solutions annual sales in Latin America to approximately US$2.2 billion. The transaction is pending approval from the Administrative Council for Economic Defense (CADE) in Brazil.

“The acquisition expands our footprint in Brazil from five states to 13 and supports growers in a key region of the world that will increasingly be relied on to sustainably increase crop production and feed a growing population, especially with the current global food insecurity challenges,” said Ken Seitz, Interim President and CEO at Nutrien.

“Our strong team in Brazil has successfully closed and onboarded five transactions since 2020,” Seitz added. “We expect that integrating Casa do Adubo will further enhance our ability to provide whole-acre solutions for all customers in the region, while delivering quality earnings in this large and growing market.”

Subject to approval and completion of the acquisition, Nutrien expects to surpass its stated target of US$100 million of adjusted EBITDA in Brazil by 2023. The company will have 180 commercial units in Latin America, including customer-facing retail branches and experience centers, five industrial plants, and four fertilizer blenders. In addition, Nutrien will have more than 3,500 employees in the region, including more than 700 crop consultants serving growers in Argentina, Brazil, Chile, and Uruguay.

“We appreciate the reputation Casa do Adubo has earned for delivering strong financial performance, attracting top talent, and offering quality products and services,” said André Dias, Nutrien’s Regional Leader in Latin America. “With the acquisition, we will strengthen our existing presence and expand to serve additional growers with innovative solutions that help sustainably feed the world.”

The transaction comes just three weeks after Nutrien announced an agreement to acquire Marca Agro Mercantil, an agricultural inputs retailer with seven stores in the regions of Triângulo, Alto Paranaíba, and Sudoeste Mineiro in Brazil (GM July 1, p. 1). Last December, Nutrien said it planned to spend R$600 million in 2022 on Brazil expansion (GM Dec. 17, 2021).

European Gas Saga Continues; Yara, Fertilizers Europe Speak Out

Europe, Featured, Natural Gas, News, Nitrogen, Norway, Russia

Yara International ASA warned this week that there is “a clear risk of nitrogen shortages and further price spikes if the natural gas availability in Europe continues to deteriorate.”

The Oslo-based major said it has curtailed several of its production plants, currently amounting to an annual capacity of 1.3 million mt of ammonia and 1.7 million mt of finished fertilizer, and warned that more cuts may come (see related Yara earnings story).

The current curtailments in Yara’s ammonia and finished fertilizer production equate to around 27% and 18%, respectively, of the company’s European capacity, according to a Dow Jones report on July 19.

German chemicals giant BASF SE also is among several other European producers to have curtailed output (GM July 1, p. 1) and has reduced ammonia production rates at Ludwigshafen, Germany, and Antwerp, Belgium.

BASF, as cited by the Dow Jones report, said all internal and external customer needs were currently being met, but that further curtailments to ammonia production “would put additional pressure on an already extremely tight market.”

Germany’s Baader Bank AG said early this month a possible shutdown of BASF’s Ludwigshafen site could be compensated by the company’s production facilities in Antwerp and in the U.S. BASF has ammonia production capacity of 910,000 mt/y at Ludwigshafen and 610,000 mt/y at Antwerp, according to Green Markets’ database.

In the U.S., BASF has a 32% stake in an ammonia production joint venture with Yara – Yara Freeport LLC in Freeport, Texas, which started up in April 2018 (GM April 13, 2018). The plant, located at BASF’s site in Freeport, has a capacity of 750,000 mt/y, and each party offtakes ammonia according to their ownership share.

Jacob Hansen, the Director General of European fertilizer manufacturers’ industry organization Fertilizers Europe, in a July 20 statement warned that without a steady supply of affordable gas, “there is a looming risk for European fertilizer production and in turn food production in the European Union (E.U.).”

In the past weeks, European fertilizer producers grappled with historically high gas prices leading to another round of curtailments, the industry body noted.

“If natural gas availability is to deteriorate further, Europe risks experiencing fertilizer shortages that will impact Europe’s agriculture in the coming season,” said Hansen.

While acknowledging the European Commission’s efforts to ensure coordinated action to prepare for possible further gas disruptions, Fertilizers Europe is calling on the E.U. and Member States’ leaders to ensure that “the gas flows where it is most needed, protecting domestic users as well as prioritizing essential sectors of the economy.”

“Maintaining a well-functioning fertilizer sector across Europe is essential to avert risk of fertilizer shortages which could have a detrimental effect on Europe’s food sovereignty,” Hansen said.

The E.U. has forecast near-term gas shortages amid the risk of further gas supply cuts from Russia, with the European Commission noting in a statement this week that almost half of Member States already are affected by reduced Russian gas deliveries.

Amid its efforts to reduce the Bloc’s reliance on Russian supply, the Commission has proposed this week that Member States cut natural gas usage by 15% between Aug. 1, 2022, and March 31, 2023, and according to a report by the U.K.’s Financial Times, is preparing to tell Member States to cut gas consumption “immediately.”

The Commission will provide members next week with voluntary gas reduction targets, cautioning that targets will be “mandatory” in the event of severe disruption to supplies, according to the report.

This came amid uncertainty surrounding the reopening of the Nord Stream 1 gas pipeline connecting Russia with Europe via Germany. Early in the week Russia’s Gazprom declared force majeure on at least three European gas buyers, according to Bloomberg, a move that signalled to some that it intended to keep supplies capped. The continent had been bracing itself for Russia not to restart gas flows through the pipeline, but it was able to breathe a little relief on July 21 when gas flows resumed after the pipeline was closed for 10 days for planned maintenance.

Shipments are being made at some 40% of capacity as of July 21, Bloomberg reported, citing data from the pipeline operator.

However, while the restart has eased Europe’s worst fears that Russian President Vladimir Putin would keep the pipeline halted, much uncertainty continues about future gas flows through the critical link. Putin’s time of maximum leverage on gas supplies will occur as Europe heads into winter.

Europe should be prepared for Russia to stop supplying the region completely this winter, the International Energy Agency (IEA) told the Financial Times last month.

IEA Executive Director Faith Birol told the newspaper that “The nearer we are coming to winter, the more we understand Russia’s intentions. Europe should be ready in case Russian gas is completely cut off.”

European benchmark natural gas prices on the Dutch TTF gas futures in Amsterdam eased marginally on the restart of the Nord Stream pipeline, with the front-month contract (currently August) down 0.811% on the day at €156.295 a megawatt-hour (MWh) as of 3:59 p.m. (GMT).The front-month traded as high as €180.505 per MWh last week, on July 13.

Yara 2Q Beats Estimates; Production Cuts Detailed; More Possible

DAP/MAP, Earnings, News, Norway, NPK, Potash Muriate, SSP, Sulfate of Potash, UAN, Urea

Yara International ASA, Oslo, reported a 23% increase in net income attributable to shareholders of the company to $664 million ($2.61 per share) on revenue of $6.45 billion for the second-quarter ended June 30, up from the year-ago $539 million ($2.10 per share) and $3.95 billion, respectively.

EBITDA excluding special items rose 90% to $1.48 billion, up from $775 million the previous year, beating analysts’ average estimate of $1.35 billion (Bloomberg Consensus). Revenue was up 63% and was on par with analysts’ average estimate of $6.45 billion. Second-quarter operating income was $1.22 billion, compared with the year-ago $477 million.

Yara reported higher selling prices and a particularly strong financial performance from overseas assets, which more than offset higher European feedstock costs and lower deliveries, according to its July 19 results statement. The Americas, Africa, and Asia segments accounted for approximately 55% of the company’s EBITDA in the second quarter.

However, this was partially offset by currency translation loss, which the company noted was driven mainly by the impact of a stronger U.S. dollar on its debt portfolio, which is primarily held in U.S. dollars.

Total Yara second-quarter deliveries were down 18% at 8.06 million mt, versus the year-ago 9.78 million mt. Second-quarter fertilizer deliveries fell 21% year-over-year, to 5.79 million mt, down from 7.35 million mt. The company noted premium products were more resilient with a year-over-year decline of 14%. The drop in deliveries was largest in Europe and Americas, each down by 22% on a year ago.

Yara said it has currently curtailed several of its production plants, amounting to an annual capacity of 1.3 million mt of ammonia and 1.7 million mt of finished fertilizer, and warned that more cuts may come. The current curtailments in ammonia and finished fertilizer production equate to around 27% and 18%, respectively, of the company’s European capacity, according to a Dow Jones report.

Of the finished product curtailments, roughly half is urea for fertilizer, while the rest is nitrates and NPKs.

Company-wide ammonia production in the second quarter was down 11% at 1.69 million mt versus the year-ago 1.89 million mt, while first-half output was 7% lower at 3.41 million mt compared to 3.68 million mt.

In addition to curtailments due to increased gas costs, Yara reported reliability issues in Pilbara, Australia; Ferrara, Italy; Brunsbuttel, Germany; and Cubatão, Brazil, and also turnaround delays at Hull, U.K., and Cubatão, impacting its second-quarter ammonia production.

Production of total finished products (fertilizer and industrial, but excluding bulk blends) fell by 10% to 4.47 million mt, down from 4.98 million mt in second-quarter 2021, and also by 7% in the first half, to 9.33 million mt from 10.04 million mt.

There were also reliability issues within finished products, with Yara noting “the major impacts” in Tertre, Belgium; Porsgrunn, Norway; Babrala, India; and at Cubatão.

Yara highlighted that there is no material impact on the company’s finished product volumes “so far” due to lack of raw materials, as it has increased its phosphates and potash sourcing from existing suppliers and entered into contracts with new suppliers to offset lost volumes from suppliers linked to sanctions.

The company also highlighted the ability of its NPK plants to adapt to both raw material sourcing and NPK grades produced in response to significant market disruptions, both in terms of raw material supply and customer demand.

“Seasonally lower Northern Hemisphere demand, combined with the recent European gas price surge, is leading to significant curtailments in Europe, including Yara,” said Yara President and CEO Svein Tore Holsether.

The company sees gas costs for the third and fourth quarters of 2022 respectively at $1.1 billion and $920 million higher than a year earlier, based on current forward markets for natural gas and assuming stable gas purchase volumes.

In Europe, Yara noted that nitrogen deliveries for the industry in the 2021/22 season are estimated to end 19% behind a year earlier, as higher fertilizer prices have shifted optimal application rates lower. It said nitrate inventories in Europe are at a historically low level, and new season buying has been limited so far.

“Despite a recent correction in grain prices, farmer profitability remains high. But there is a clear risk of nitrogen shortages and further price spikes if buying is delayed, especially if natural gas availability in Europe continues to deteriorate,” said Holsether.

Yara said it will continue to adapt to market conditions and – where possible – use its global sourcing and production system to supply customers, but said it cannot produce at negative margins.

In an interview on Bloomberg TV on July 19, Holsether said the company is “on constant watch” in case it needs to further lower production.

For Europe, second-quarter EBITDA excluding special items was $150 million higher than a year earlier, as higher prices more than offset lower deliveries and increased feedstock costs. Deliveries decreased by 22% to 1.58 million mt, down from the year-ago 2.03 million mt, mainly reflecting lower demand due to high market prices.

For the Americas, EBITDA excluding special items was $406 million higher in the second quarter than a year earlier, mainly reflecting significantly higher nitrogen upgrading margins in North America.

Deliveries were down 22% to 3.01 million mt, with Yara citing the sanctions imposed on suppliers from Russia and Belarus impacting deliveries of commodity fertilizers for blending and distribution. However, the company said premium product deliveries were relatively strong with a decline of only 2%.

For Africa & Asia (which also includes Oceania), second-quarter EBITDA excluding special items was $55 million higher than a year earlier, driven – Yara said – by higher production margins on ammonia. Total deliveries were 18% lower at 1.21 million mt as high fertilizer prices and weaker farmer profitability in several core segments of the region impacted demand.

Yara’s Global Plants & Operational Excellence (GPOE) business posted a second-quarter EBITDA excluding special items $72 million higher than a year earlier. The result was mainly driven by increased nitrogen and phosphate prices, which more than offset increased energy costs and raw material price increases.

The Clean Ammonia business posted EBITDA excluding special items in the second quarter $9 million higher than the previous year, as increased margins linked to higher ammonia prices more than offset lower volumes. The lower volumes mainly reflect a stop in sourcing from Russia and reduced ammonia production at Yara’s plants in the quarter.

The company highlighted the margin improvement for the Clean Ammonia segment, reporting a net $900 million improvement despite gas cost increases amounting to more than $1 billion.

For Industrial Solutions, second-quarter EBITDA excluding special items was $57 million higher than a year ago, mainly due to strong margins in Brazil and higher market prices in Europe reflecting increased production costs and supply shortages due to sanctions on Russia and Belarus. Second-quarter deliveries were flat on a year earlier, at 1.86 million mt.

Yara on July 19 published its first Green Financing Framework, rated medium green by CICERO, a green bond rating service.

Potential financing proceeds will be used for eligible green projects such as green ammonia, premium fertilizer production assets, and carbon capture and storage projects, the company said.

It sees these green projects creating substantial environmental benefits by decarbonizing the food chain, including fertilizer production and application, and by limiting the need to expand farmland.

For the first half of 2020, the company posted a 192% increase in net income attributable to shareholders of the parent company of $1.61 billion ($6.31 per share) on revenue of $12.37 billion, up from the year-ago $551 million ($2.30 per share) and $7.09 billion, respectively.

Six-month EBITDA excluding special items increased 107%, to $2.82 billion versus the prior year $1.36 billion, while revenue was up 74%. First-half operating income was $2.26 billion, compared with the year-ago $799 million.

Yara said its resilient business model continues to generate robust returns, leading to strong dividend capacity going forward, in line with the company’s capital allocation policy. The company paid dividends of $796 million in the second quarter, and the Board will consider further cash returns in connection with third quarter results.

Yara Production and Deliveries

‘000 mt 2Q-2022 2Q-2021 1H2022 1H2021
Production1        
Ammonia 1,688 1,891 3,411 3,684
Finished fertilizer and industrial products (excluding bulk blends)1 4,466 4,983 9,328 10,040
         
Yara Deliveries        
Ammonia trade 404 589 847 1,047
Fertilizer 5,793 7,347 11,916 14,198
Industrial product 1,862 1,846 3,663 3,615
Total deliveries 8,060 9,782 16,426 18,860

1 Including Yara share of production in equity-accounted investees, excluding Yara-produced blends

Yara Deliveries

‘000 mt 2Q-2022 1Q-2021 1H2022 1H2021
Crop Nutrition Deliveries        
Urea 1,317 1,802 2,695 3,170
Nitrate 817 1,173 2,232 2,764
NPK 2,043 2,281 4,124 4,729
CN 427 470 849 946
UAN 314 378 616 761
DAP/MAP/SSP 191 335 292 482
MOP/SOP 300 516 512 665
Other products 332 392 595 680
Total Crop Nutrition Deliveries 5,793 7,347 11,916 14,198
         
Europe Deliveries        
Urea 162 264 346 557
Nitrate 606 765 1,600 1,921
NPK 364 470 954 1,394
CN 98 126 191 261
Other products 346 407 734 819
Total Deliveries Europe 1,576 2,032 3,825 4951
         
Americas Deliveries        
Urea 499 787 1,118 1,418
Nitrate 197 304 509 670
NPK 1,292 1,306 2,450 2,421
CN 281 299 553 594
DAP/MAP/SSP 179 321 262 429
MOP/SOP 281 487 462 606
Other products 279 336 451 583
Total Deliveries Americas 3,009 3,841 5,804 6,721
North America 833 1,064 1,738 2,022
Brazil 1,755 2,213 3,243 3,678
Latin America excluding Brazil 421 564 824 1,021
         
Africa & Asia Deliveries1        
Urea 655 750 1,231 1,196
Nitrate 68 103 123 173
NPK 387 504 720 914
CN 48 46 105 91
Other products 51 70 108 151
Total Deliveries Africa & Asia 1,209 1,474 2,287 2,525
Asia 966 1,151 1,835 1,962
Africa 243 323 451 563
         
Industrial Solutions Deliveries        
Ammonia2 125 132 258 283
Urea2 366 410 746 807
Nitrate3 313 298 633 578
CN 49 48 101 97
Other products5 439 420 809 826
Water content in industrial ammonia and urea 570 537 1,116 1,024
Total Industrial Solutions Deliveries 1,862 1,846 3,663 3,615

1 The Africa and Asia business also includes Oceania

2 Pure product equivalents

3 Including AN Solution

4 Including sulfuric acid, ammonia, and other minor products

E.C. Temporarily Suspends N Import Duties; Farmers Urge More Action on Tariff Relief

Ammonia, Europe, Featured, News, Nitrogen, Urea

The European Commission (E.C.) on July 20 announced that it is planning to temporarily suspend import duties of 5.5% and 6.5% on nitrogen-based inputs such as ammonia and urea for the production of nitrogen fertilizers until the end of 2024, as a means to support food production and keep prices in check in response to the fallout of the war in Ukraine.

The Commission’s measures are aimed at “lowering costs for E.U. producers and farmers” and helping “increase the stability and diversification of supply by fostering imports from a wider range of third countries, while excluding Russia and Belarus from the suspension of tariffs.”

However, the Bloc’s farmers do not believe the measures are sufficient.

Brussels-based Copa-Cogeca, which represents E.U. farmers and agri-cooperatives, in a July 20 statement welcomed the E.C’s move to suspend conventional tariffs for urea and anhydrous ammonia, describing it as “a step in the right direction.” But the organization noted the move did not include suspending conventional duties on key fertilizers used directly by farmers i.e., UAN, DAP, MAP, and NPK, or antidumping duties on UAN imports from Trinidad and Tobago and the U.S.

“This approach still protects European fertilizer producers to their advantage and will not provide an easy fix for farmers,” Copa-Cogeca said.

Copa-Cogeca called on the Commission to suspend antidumping duties on UAN imports from Trinidad and Tobago and the U.S., and conventional tariffs on fertilizing products used by European farmers.

The organization said only such an ambitious measure could make those markets more dynamic and bring down the prices paid by farmers in the long term.

“European farmers are now facing the dual risk of skyrocket high mineral fertilizer prices and shortages, severely affecting not only their incomes but also the E.U.s food production and global food security,” Copa-Cogeca said, noting that its members already are worried about the delay experienced in the new fertilizer purchasing campaign.

BHP Targets First Production at Jansen in 2026

Australia, News, News Briefs, Potash, Saskatchewan

BHP Group Ltd., Melbourne, said it is working to bring first production at its Jansen potash project in Saskatchewan forward to calendar 2026, according to an Operational Review statement for the year to June 30, 2022, published on July 19.

The mining group previously was targeting first production for calendar 2027, but in May revealed that it was looking at options to bring forward first production into 2026 (GM May 20, p. 1; May 6, p. 36).

The mining group reported that the Jansen shaft project was completed in the June 2022 quarter and the US$5.7 billion Jansen Stage 1 is tracking to plan, with activities progressing at the port and at the Jansen site.

The US$5.7 billion Jansen Stage 1 is currently 8% complete. On completion, it will have capacity to produce 4.35 million mt/y of potassium chloride.

BHP, as previously reported, is continuing to assess options to accelerate Jansen Stage 2, which would add another 4 million mt/y of capacity.

OCP Blending JV in Rwanda Set for May 2023 Start-Up

Africa, Morocco, News, News Briefs

OCP Africa SA’s fertilizer blending plant currently under construction in Rwanda is expected to begin operations in May next year, according to a report this week by Rwanda’s New Times.

The plant, located in Bugesera Industrial Park in the country’s Eastern Province, will have capacity to produce 100,000 mt/y of blended fertilizers. It will operate as the Rwanda Fertiliser Co. (RFC), which is a joint venture between OCP Africa, a fully-owned subsidiary of Morocco’s OCP Group SA, and the Rwandan government. The jv was established in August 2018 (GM Aug. 17, 2018).

Completion of the project originally was targeted for the end of 2019 (GM May 24, 2019), and according to the report, has been delayed by the need to switch construction contractors due to alleged problems with the original contractor.

The cost of the plant has been put at an estimated $38 million. It will produce, market, and distribute tailor-made fertilizers best suited for Rwandan soils.

Meanwhile, the OCP Group has donated 15,000 mt of DAP to Rwanda, and has committed to supply the country with an additional 17,000 mt of DAP at a discounted price, according to a report this week by All Africa Global Media. The report cited Rwanda’s Minister of Agriculture and Animal Resources, Gerardine Mukeshimana, in an interview with the New Times.

The minister said the contribution was important “especially in this period when fertilizer costs are high, mainly as a result of the Russia-Ukraine conflict and rising transport costs associated with the COVID-19 pandemic.”

According to the report, 5,000 mt of the donated DAP will be free starting stock for the new fertilizer blending plant, while 10,000 mt will be used as a strategic fertilizer reserve.

Mukeshimana was visiting the construction site of the new fertilizer blending plant to assess its progress.

OCP to Make 550,000 Mt of Phosphate Fertilizers Available to Africa, Report Says

Africa, Morocco, News, News Briefs, Phosphate

OCP Africa SA, a wholly-owned subsidiary of OCP Group SA, Casablanca, has launched an emergency program to help African countries cope with surging fertilizer prices and shortages, Reuters reported on July 20, citing a senior company executive.

According to the report, the company plans to make 550,000 mt of phosphate fertilizers available to some 20 African countries, 180,000 mt of which will be donated. The balance will be sold at reduced prices.

It is unclear over what timescale the supplies will be delivered.

The African Development Bank said in May that fertilizer prices in Africa had gone up by 300% since the start of the war in Ukraine, and the continent faced a fertilizer shortage of 2 million mt.

The bank also noted the price of wheat had soared in Africa by over 45% since the start of the war, while many African countries already had seen price hikes for bread and other food items.

The bank warned that if the deficit is not made up, “food production in Africa will decline by at least 20% and the continent could lose over $11 billion in food production value.”

K+S Begins Covering Tailings Piles at Werra Plant

Germany, News, News Briefs, Potash

K+S Group, Kassel, Germany, has begun covering its tailings piles at the Werra potash plant in Hattorf and Wintershall.

Initially, with the start of construction on the tailings pile top in Hattorf, the focus is on the plateau covers, with the side covers to follow later, the company said.

The company already reported this past spring the covering and greening of the potash tailings pile at its Neuhof-Ellers plant.

“By completely covering the tailings piles, the tailings pile waters are significantly reduced in the long term, and we will make a major contribution to a lasting reduction in the environmental impact associated with potash production in the Werra-Fulda region,” said K+S.

Chemtrade, Kanto Group Announce New Electronic-Grade Sulfuric Acid Plant

Canada, Japan, News, News Briefs, Sulfuric Acid

Chemtrade Logistics Income Fund, Toronto, and Kanto Group, Tokyo, on July 18 announced the formation of a joint venture, KPCT Advanced Chemicals LLC, aimed at building a new electronic-grade sulfuric acid production facility in Casa Grande, Ariz.

The facility will feature a nameplate capacity of 100,000 mt/y and will utilize Kanto Group’s production process, currently in use in Taiwan and Japan to supply semiconductor producers in Asia.

The $175-$250 million project will receive detailed greenfield engineering plans and cost estimates in fourth-quarter 2022. Commissioning is slated for 2024.

“For years, Chemtrade has been the primary manufacturer of ultrapure sulfuric acid in the North American market,” said Chemtrade President and CEO Scott Rock. “This joint venture allows us to expand our North American position and meet the growing needs of the semiconductor manufacturers.”

The U.S. Senate on July 19 voted 64-34 to advance a bill designed to incentivize the manufacture of semiconductors within the U.S. The bill would provide approximately $50 billion in subsidies to domestic manufacturers in an effort to increase competition with China.

The bill’s original version, first approved in 2021, would have delivered up to $250 billion in subsidies. A final vote on the bill is expected within days.

Chemtrade and Kanto Group own 49% and 51% of the jv, respectively.