All posts by mickeybarb@charter.net

Idaho Seeks Comment on Remedial Action Plan for Two Phosphate Mines

News, News Briefs, Pacific N.W., Phosphate

The Idaho Department of Environmental Quality (IDEQ) seeks comment on Nu-West Industries/Mining Inc.’s South Central Rasmussen Ridge draft final remedial action plan pertaining to two former phosphate mines in Southeastern Idaho’s Caribou County – the South Rasmussen Ridge Mine (257 acres) and the Central Rasmussen Ridge Mine (231 acres).

On April 17, 2013, IDEQ and Nu-West entered a consent order in which Nu-West agreed to address groundwater and interconnected surface water impacts at the Caribou/Targhee National Forest site about 20 miles northeast of Soda Springs, where state water quality standards are exceeded.

The plan summarizes existing remedial actions, short- and long-term remedial alternatives, appropriate remedial action options, and a schedule for implementing and completing those actions.

Rasmussen Ridge contains several adjacent mining projects, including Agrium’s North Rasmussen Ridge Mine and P4 Production LLC’s Enoch Valley Mine, both inactive and undergoing reclamation. A constructed haul road connects the former South Rasmussen Ridge Mine and Central Rasmussen Ridge Mine.

South Rasmussen Mine post-mining reclamation operations and Itafos Conda’s active Rasmussen Valley Mine a mile south of the Nu-West site also use the site haul road.

Valleys in the area range in elevation from about 6,000 to 6,500 feet. Elevation at Rasmussen Ridge is about 7,000 feet. The Blackfoot Reservoir is about nine miles west of the Nu-West site.

Written comments about the Nu-West remedial action plan will be accepted through July 18. Questions and/or written comments may be submitted on IDEQ’s website or by mail to Stan Christensen, Mining Project Coordinator, IDEQ, 444 Hospital Way, No. 300, Pocatello, ID 83201, or by e-mailing Stan.Christensen@deq.idaho.gov.

Western Potash Expects Operations Ramp-Up in Mid-2023; Successful Restart Confab Reported

News, News Briefs, Potash, Saskatchewan

Western Potash Corp., Kronau, Sask., said on June 17 that it has completed a Collaborative Project Planning Session with its key contractors and staff to officially kick off the restart of the Milestone Potash Project in order to complete the process facilities and solution mining development.

Key project representatives participated in a workshop-style planning session in Regina, Sask., to review and gain alignment on key aspects of the project timeline and readiness for start-up, leading into the full ramp-up of operations, which is expected to happen in mid-2023.

Milestone Phase 1 would produce 146,000 mt/y. Its purpose is to test and optimize the horizontal solution mining method in Saskatchewan, and to investigate how the method can be applied to full-scale potash production.

The kickoff planning session was attended by Western executives and staff and more than 30 people from several different key organizations, each with an instrumental role in the project, including Bird Construction (GM May 20, p. 28) and March Consulting. Also participating were representatives of Vantage Chance Ltd. and Appian Capital Advisory LLP (GM April 29, p. 29), each of which recently closed a financing deal with Western.

Areas of key focus included cavern development, execution of the construction program, and operational readiness, including commissioning, start up and permit readiness.

“I am pleased to see the project construction restarted after being suspended for two years,” said Bill Xue, Chairman and CEO. “I am very happy that all key project participants attended and actively interacted during the kickoff discussion. This session has helped all relevant parties together reach a better and clearer understanding of project goals and priorities.

“It also allowed the internal team and key contractors to identify gaps, resulting in the development of an integrated action plan that will significantly mitigate any potential risks potentially affecting project schedules and cost. I am confident that our team and contractors are capable of making this project a success,” Xue added.

Arianne Reports Positive Results for Phosphate Use in Batteries

Canada, News, News Briefs, Phosphate

Arianne Phosphate, a development-stage phosphate mining company advancing its Lac à Paul project in Quebec’s Saguenay-Lac-Saint-Jean region, announced on June 21 that it has received positive results from tests that confirm its high-purity phosphate concentrate can be used in the production of technical grade phosphoric acid used in the production of batteries.

These tests were designed to confirm that Arianne meets specifications provided by a producer of lithium-based batteries (GM Nov. 5, 2021) and were performed through an independent facility specializing in the production of purified phosphoric acid.

“Given the nature and high-purity of our phosphate concentrate, we were always confident that our rock would perform,” said Brian Ostroff, President of Arianne Phosphate. “These tests demonstrate the high quality of our product and will allow Arianne to access markets beyond traditional fertilizer markets.

“The company’s recent initiatives surrounding direct application and alternative fertilizers, along with our work in battery materials, really does differentiate us from many of the other projects,” he added. “Further, recent geopolitical events have highlighted the importance of security of supply in dealing with food security and critical materials.”

Arianne noted the lithium-iron-phosphate battery (LFP) has emerged as a leading technology in batteries, and that many automotive companies, such as Tesla, Volkswagen, Ford, and GM are currently, or have already announced, plans to use LFPs in their cars, following that of many Chinese companies.

Arrianne added that beyond the automotive market, many industry analysts view the LFP battery as playing a key role in the energy storage market, a market that could exceed automotive demands and continue to drive demand for these battery materials such as phosphate.

Arianne said it has an igneous deposit that allows it to produce a high-purity, low-contaminant concentrate suitable for use in all applications, meaning the company’s clients can be from a wide range of industries. Arianne currently projects 3 million mt/y of phosphate concentrate production, for a minimum of 26 years.

Peru Farmers Ask to Renegotiate Bayovar Contract

News, News Briefs, Peru, Phosphate

Peru farmers asked authorities to renegotiate the Bayovar phosphate deposit contract to produce fertilizers in the country amid an acute shortage and higher prices, Climaco Cardenas, President of Agriculture Association Conveagro, told Bloomberg in an interview.

Bayovar mine’s concessionaire is Miski Mayo, controlled by The Mosaic Co. “They pay $2.90 for one ton of phosphate rock, and we pay $900 per ton of fertilizer,” said Cardenas, who said Conveagro has sent documents to the government asking to renegotiate the contract and has held meetings with lawmakers.

Northside Plans $20 M Agronomy Facility

Great Lakes, News, News Briefs

Northside Elevator, Loyal, Wisc., recently reported that it plans to construct a $20 million agronomy center in Stanley, Wisc. It said the facility will include a state-of-the-art production facility, advanced logistics, and customer service.

The centerpiece of the project is a tower system fertilizer manufacturing plant. The company said the system will produce consistent, high-quality fertilizers at the speed needed for farmers to have a successful planting season.

Other key features include a rail spur for more efficient procurement of production materials; warehousing that will create greater flexibility in purchasing and storage of fertilizer and seed and serve as an internal distribution hub; and office space to support customer service.

Northside said this new location, coupled with existing facilities in Loyal, will provide greater efficiency in distribution of products with reduced travel time for application equipment. It said the location along State Highway 29 will enhance transportation options and allow for more efficient support of customers in the Chippewa Valley area and other regions throughout western Wisconsin.

“As a family-run company, customer satisfaction has always been our top priority,” said Dean Schiller, Director of Operations for Northside Elevator. “We are anticipating the future needs of agricultural producers; this investment demonstrates Northside’s commitment to these individuals, and the future of farming throughout the region.”

The company, which was founded in 1948, said it anticipates hiring eight to ten employees initially, with careers primarily focused on production, transportation, and logistics needs.

Syngenta – Management Brief

Eastern Cornbelt, Management Briefs

Syngenta, Downers Grove, Ill., on June 23 announced the appointment of Eric Boeck as Regional Director, North America Seeds, responsible for leading the field crops strategy for the region.

Boeck joined Syngenta in 2018, most recently serving as the Head of Marketing for Syngenta Seeds in North America. Prior to joining Sygenta, he worked in sales, marketing, and digital agriculture roles at DuPont Pioneer/Corteva Agriscience.

The move is part of a series of recently announced leadership transition plans at Syngenta, which include Jeff Rowe, President of Syngenta Seeds, assuming leadership of Syngenta Crop Protection, and Justin Wolfe, the current Regional Director for North America Seeds, becoming the global leader for the Seeds business. These transitions will be effective July 1, 2022.

Incitec Pivot Ltd. – Management Brief

Australia, Management Briefs

Incitec Pivot Ltd. (IPL), Southbank, Victoria, on June 22 announced the appointment of Michael Carroll as Chairman designate of the proposed standalone Incitec Pivot Fertilisers business, should the structural separation of the Incitec Pivot Fertilisers (IPF) business and Dyno Nobel business proceed.

IPL on May 23 announced its plan to demerge its fertilizer and mining explosives divisions into two separate Australian Securities Exchange (ASX) listed companies by mid-2023 (GM May 27, p. 1).

IPL Chairman Brian Kruger said the intended appointment of Carroll as Chairman of IPF ensured that the Board of IPF would be led by an experienced and highly regarded Non-Executive Chairman.

Carroll is an experienced Non-Executive Director and has extensive executive experience in the financial and agricultural sectors. He had an 18-year executive career with the National Australia Bank (NAB), including as General Manager of NAB’s Agribusiness Financial Services, where he was responsible for creating and leading the bank’s Agribusiness division.

Prior to joining NAB, Carroll held positions in the agricultural sector with Monsanto Australia Ltd., Schering Pty Ltd., and Gene Link Australia Ltd.

He is currently a Non-Executive Director of Rural Funds Management Ltd, Paraway Pastoral Company, Viridis Ag Pty Ltd., Australian Rural Leadership Foundation, Genetics Australia, and Regional Investment Corp.

ISU Sees Second-Half Fertilizer Price Decline; Not Enough Evidence to Find “Greedflation”

News, News Briefs, U.S.

Fertilizer producers’ profits have soared over the last two years as farmers were hit hard by increased prices, according to a new study by Iowa State University (ISU) and requested by Iowa Attorney General Tom Miller.

While crop prices have roughly doubled over the past couple of years, fertilizer prices are two-to-four times higher than they were in September 2020. Fertilizer producers have higher profit growth during the pandemic than many other food and agricultural industries, the analysis by ISU’s Center for Agricultural and Rural Development (CARD) showed.

ISU believes fertilizer prices may ease in second-half 2022. “As supply chains improve, ports reopen, labor becomes more available, and energy prices ease, the expectation is that fertilizer prices will decline in the second half of 2022,” they said.

However, ISU noted that factors could prevent fertilizer prices from stabilizing in the short- and longer-term, including “natural gas demand and supply, changes in trade policy or economic sanctions, increased acreage demand by farmers, and potential market power in the fertilizer industry.”

The study said there is not enough evidence to determine whether fertilizer producers are using their market power to engage in “greedflation.” Whether “fertilizer firms may be taking advantage of inflation to raise prices … are good questions for which we need more data,” according to the report by Agriculture Economist John Crespi, Director of CARD, and other five other ISU researchers.

Miller thanked ISU for undertaking the study. “This thorough report raises many good questions, which we will continue to explore,” he said. “Although there are a lot of unknowns, we remain concerned that increases in crop returns for farmers tend to coincide with even higher increases in fertilizer expenditures.”

Earlier this year, Miller announced that his office (GM March 4, p. 1) would examine the unprecedented increases in fertilizer prices after the Iowa Corn Growers Association approached him with concerns. Miller began working with Secretary of Agriculture Tom Vilsack and others, and he requested information from the five major fertilizer manufacturers: The Mosaic Co., Nutrien Ltd., CF Industries Holdings Inc., Koch Industries Inc., and OCI NV, owner of Iowa Fertilizer Co.

The ISU study shows that from 2018-19 to 2020-21, net income for fertilizer companies has increased four-fold in some cases. Bunge Ltd.’s profits increased 415%, Mosaic’s 418%, and Nutrien’s 276%. However, the study noted that many fertilizer companies had negative returns in 2018-19.

The fertilizer companies have cited many reasons for the price increases, which the ISU study notes: decreased production due to COVID-19, natural gas production disruptions and price fluctuations, natural disasters affecting production and natural gas demand, and tight global supplies compounded by the Chinese ban on exports and sanctions on Russia and Belarus.

H Sulphur Announces Capacity Expansion Project

News, News Briefs, South Korea, Sulfur

H Sulphur Corp. (Seoul, South Korea) on June 20 announced plans to nearly double the company’s solid sulfur production capacity, boosting output by 156,000 mt/y from the current 160,000 mt/y capacity.

IPCO Germany (Fellbach, Germany) was contracted to build two new production lines at H Sulphur’s Ulsan, South Korea, production facility, both of which will utilize the high-speed Rotoform pastillation process.

Commissioning of the new lines is slated for February 2023. The plant currently operates five solid sulfur production lines, including one cooling-belt type and four drum types.

In addition to solid sulfur, H Sulfur produces sulfur bentonite as well as urea-enhanced sulfur, produced via a licensing of Shell’s Thiogro production process.

Germany Raises Alarm on Russian Gas Cuts; Romania’s Azomureş Halts Ammonia Production

Ammonia, Ammonium Nitrate, Calcium Ammonium Nitrate, Eastern Europe, Europe, Featured, Germany, News, NPK, Poland, Russia

Germany on June 23 triggered the second stage of its three-stage emergency gas plan, citing a deterioration of natural gas supplies, and raised its gas risk level to the second-highest “alarm” phase, Bloomberg reported. The final stage would include gas rationing.

Germany warned that Russia’s moves to cut Europe’s natural gas supplies risked sparking a collapse in energy markets, drawing a parallel to the role of Lehman Brothers in triggering the financial crisis earlier this millennium.

With energy suppliers piling up losses by being forced to cover volumes at high prices, there is a danger of a spill-over effect for local utilities and their customers, including consumers and businesses, Germany’s Economy Minister Robert Habeck was cited by Bloomberg as saying on June 23 after raising the country’s gas risk level.

Russian state oil and gas major PJSC Gazprom last week cut by 60% the volume of natural gas it delivers to Europe via the Nord Stream 1 pipeline that serves Germany and other European countries. Gazprom blamed the reduction on a technical fault, but it was widely seen in Western Europe as the latest indication that Moscow appears intent on punishing the region for sanctions and military support for Ukraine. Some fear the Russian gas supply reduction may be a precursor to a complete turning off of the supply taps.

Russia’s move has added urgency to efforts in Germany and elsewhere across Europe to build up gas inventories in a crucial effort to moderate escalating prices, and to try and head off the possibility of gas shortages this winter.

In May, the European Union (E.U.) agreed to require Member States to fill their gas storage facilities to at least 80% of capacity by Nov. 1. So far, member countries have been making good progress, with overall European storage levels at 55%, according to Bloomberg.

But Gazprom’s cutbacks have put that progress in doubt.

If gas storage is not filled by the end of summer, the markets will interpret that as a warning of price spikes or even energy shortages, according to Henning Gloystein, a Director at Eurasia Group, a political risk firm, as cited by Bloomberg.

If Nord Stream 1 was shut down completely, Europe would run out of gas in January, Bloomberg cited consulting firm Wood Mackenzie Vice President Massimo Di Odoardo as saying.

Natural gas prices are already about six times above where they were a year ago.

The front month (currently July) European gas contract on the ICE Dutch TTF gas futures was at €130.4 per megawatt hour (MWh) at 3.59 pm (local time) on July 23, up 3.325 on the day and versus €127.171 per MWh at close on June 17. The front-month TTF contract closed at just €80.434 per MWh on Jan. 3, and closed at just €31.545 per MWh on June 23 last year.

These latest escalating natural prices are forcing some fertilizer producers to question whether fertilizer production remains economically sustainable.

Romania’s biggest fertilizer producer, Azomureş SA, this week decided it is not. On June 22, the producer announced it had taken the decision to temporarily suspend ammonia production as of June 23, following a rise in natural gas prices and a decrease in fertilizer prices with the onset of crop harvesting.

Azomureş said it would continue to produce fertilizers at its Târgu Mureș site until the existing ammonia stock is depleted.

It said gas prices had risen from €80 MWh (approximately $84.3 at current exchange rates) to €125-130 MWh ($131.7-$137.00) in recent days following the problems in the European gas transmission chain and gas storage operations for the winter season 2022/2023, as well as the explosion at a Texas, U.S., liquefied natural gas (LNG) export terminal earlier this month, which is expected to cut exports for weeks.

“Under these conditions, it is obvious that fertilizer production is currently not economically sustainable,” Azomureş said.

The Romanian company only restarted production in early May (GM April 29, p. 32), after halting fertilizer production on Dec. 17 last year due to “the very high prices” for energy, natural gas, and electricity (GM Dec. 17, 2021; Dec. 10, 2021).

Production was restarted only at “limited levels” and only of certain fertilizer products, namely, ammonium nitrate, calcium ammonium nitrate, urea, and melamine. Azomureş had at the time anticipated restarting NPK production “in the coming months.”

Azomureş staff will continue to work where needed, but the company said laying off staff may be necessary in the event of an extended production suspension.

“It is serious what is happening today on the gas market for most European fertilizer producers,” said Azomureş General Manager Harri Kiiski.

“In Romania, we continue the dialogue with government authorities in order to apply economic aid offered by the E.U., already applicable in many European countries. For example, Bulgaria provides capped price of gas for its industries, €72 MWh. Until today, Romania does not implement the aid scheme for energy-intensive industries, given the European legal framework,” he said.

“As a producer, we know that it is difficult to ensure the necessary quantity for the next agricultural season if we do not produce during the summer. The scheme provided by the E.U. must be applied,” said Kiiski.

The Târgu Mureș-based company’s annual fertilizer production under normal operating conditions is 1.6 million mt, with approximately 75 percent of the output destined for Romanian farms, according to the company. It produces granular and prilled AN, granular CAN, granular urea, and NPs, as well as NPKs.

Azomureş has been owned by Swiss Group Ameropa, via a subsidiary, since 2012.

OCI NV last week was reported to be halting production at one of its two ammonia units in The Netherlands due to spiking natural prices, but would continue downstream production using imported ammonia (GM June 17, p. 28).

Shares in Poland’s biggest fertilizer producer, Tarnów-based Grupa Azoty SA, fell this week as concerns escalated about scarcity of natural gas in Europe as Russia limits supplies.

By close on June 23, Azoty shares had fallen to Pln42.94 (approximately $9.68 at current exchange prices) per share, a 7.66% drop on the day and a 15% drop in two days.

Erste Group Bank AG analyst Jakub Szkopek, cited in a Bloomberg report, said spot natural gas prices in Europe had risen 40% last week, adding pressure on fertilizer manufacturers’ margins.

Azoty may be also hit by a rise of thermal coal prices. The company consumes about 1.2 million mt of fuel annually, while prices in Polish coal in contracts are rising to PLn20/GJ from Pln10-12/GJ, Bloomberg reported.

On June 22, Polish Deputy Prime Minister Jacek Sasin said that state companies should not “maximize” their profits in current tough conditions for customers, seen by analysts as negative for companies like Azoty, according to the report.