All posts by mickeybarb@charter.net

Grupa Azoty Says May Cut Production if Gas Prices Continue to Rise

News, News Briefs, Poland

Poland’s Grupa Azoty SA CEO Tomasz Hinc said late this week the group has not decided to limit the production of fertilizers, but it does not rule out such a decision in the future if gas prices continue to rise significantly, according to an Oct. 28 report by the Polish Press Agency (PAP) citing the CEO.

Tomasz confirmed Azoty’s facilities are currently operating at an unchanged level. Earlier this month, the fertilizers and chemicals group said it was taking “all possible measures” not to limit production, despite “the record-breaking” gas prices (GM Oct. 8, p. 30). 

However, the group has said supplying the domestic market with fertilizers is a priority, and recently decided to limit exports and re-direct its products to the domestic market, with the exception of long-term contracts (GM Oct. 15, p. 28).

Azoty is one of two key fertilizer producers in Poland.

Australia’s Woodside to Build New Hydrogen, Ammonia Project in Perth

Ammonia, Australia, Hydrogen, News, News Briefs

Australian oil and gas producer Woodside Energy Ltd., Perth, on Oct. 25 unveiled plans to build a hydrogen and ammonia production facility in the southern metropolitan region of Perth.

The proposed project, named H2Perth, at full potential expects to produce up to 1,500 mt/d of hydrogen for export in the form of ammonia and liquid hydrogen.

Woodside said the project will initially target 300 mt/d of hydrogen, or 20 percent of expected total capacity, which can be converted into 600,000 mt/y of ammonia, or 110,000 mt/y of liquid hydrogen.

H2Perth will be built on around 130 hectares of vacant industrial land to be leased from Western Australia’s State government in the Kwinana Strategic Industrial Area and Rockingham Industry Zone. The location is close to existing gas, power, water, and port infrastructure.

Woodside said it will now begin community engagement on the project, along with detailed progress with customers. Subject to necessary commercial and regulatory approvals and a final investment decision, construction is estimated to start in 2024.

The hydrogen and ammonia from H2Perth would be produced using both electrolysis technologies and natural gas reforming, with 100 percent of carbon emissions abated or offset. The electrolysis component of the project will have an initial capacity of 250 megawatts, with potential to scale up to more than 3 gigawatts.

Saudi Aramco Inks MOU for Green Hydrogen, Ammonia Plant; Seeks Buyers for Blue Ammonia from 2030

Ammonia, Featured, Green Hydrogen, News, Saudi Arabia

Saudi Aramco, Dhahran, has signed a Memorandum of Understanding (MOU) with Riyadh-based Modern Industrial Investment Holding Group and Hong Kong-based InterContinental Energy, a leading green hydrogen developer, to develop a green hydrogen and ammonia project in Saudi Arabia. The Saudi company provided no further details on the project, however.

The MOU was one of five separate memoranda signed by the company on Oct. 26. One of these was inked with South Pole Carbon Asset Management Ltd. and Yousef Abdulrahman Al Dhabyan Agriculture Est. (Yadgreen) to evaluate the feasibility of establishing a National Green Services Company to develop and innovate “nature-based solutions that help reduce greenhouse gas emissions.”

In a separate development this week, Saudi Aramco is reported to be in talks with potential buyers for exports of blue ammonia that it expects to begin from 2030.

The company is investing in hydrogen production research and facilities. But Saudi Aramco Chief Technology Officer Ahmad Al-Khowaiter, speaking at an investment conference in Riyadh this week, declined to comment to Bloomberg on how much money the company is planning to invest in hydrogen.

The company initially needs to secure demand and that is the process the company is looking at right now, Al-Khowaiter said.

PhosAgro 3Q, 9M, Fertilizer Sales Dip; Higher Nitrogen Sales Reported

Ammonium Nitrate, Ammonium Sulfate, DAP/MAP, Earnings, News, Nitrogen, NPK, NPS, Phosphate, Russia, Urea

PhosAgro, Moscow, reported a 1 percent dip in fertilizer production and a 3 percent fall in fertilizer sales in the third quarter versus a year-ago. Nine-month fertilizer output showed a small uptick (0.2 percent) on the year, but sales fell 2 percent.

The fertilizer group cited higher production of DAP and MAP, as well as of NPK fertilizers, as driving the increase in nine-month production to 7.55 million mt.

Nine-month fertilizer sales totalled 7.79 million mt, down from the year-ago 7.91 million mt.

Sales of phosphate fertilizer and MCP in the nine-month period were 4 percent lower, falling to 5.86 million mt, down from 6.12 million mt.

PhosAgro attributed the main reason for the fall in phosphate fertilizer sales to the “restrained” seasonal demand in India as a result of the late decision by the country’s government on subsidies and the relatively low level of the subsidies.

Nine-month nitrogen fertilizer sales increased by 8 percent to 1.93 million mt, up from 1.79 million mt.

The group cited high demand in global markets, combined with a decrease in production of nitrogen fertilizer in Europe, as primarily behind the increase, which it said was particularly noticeable in the third quarter. Ammonium nitrate sales were the main driver of the growth, with sales volumes up 161 percent in the third quarter and 35 percent in the Jan.-Sept. period, compared with the same year-earlier periods.

PhosAgro celebrates its 20th anniversary this October.

PhosAgro fertilizer production

‘000 mt 3Q 2021 3Q 2020 % change Jan.-Sept. 2021 Jan.-Sept. 2020 % change
Phosphate fertilizers and MCP 1,954.3 1,940.5 +1 5,779.8 5,748.2 +1
Nitrogen fertilizers 539.0 573.7 (6) 1,770.6 1,788.9 (1)
Total fertilizers 2,493.3 2,514.2 (1) 7,550.4 7,537.1 +1

PhosAgro fertilizer sales volumes

‘000 mt 3Q 2021 3Q 2020 % change Jan.-Sept. 2021 Jan.-Sept. 2020 % change
Total fertilizers 2,630.5 2,724.2 (3) 7,786.5 7,909.9 (2)
Phosphate fertilizers and MCP 2,115.1 2,247.0 (6) 5,858.7 6,123.7 (4)
Of which:            
DAP/MAP 914.0 922.3 (1) 2,606.7 2,667.9 (2)
NPK 892.7 886.7 +1 2,310.9 2,244.0 +3
NPS 182.0 299.8 (39) 491.2 719.5 (32)
APP 45.6 38.3 +19 149.8 148.1 +1
MCP 79.8 95.2 (16) 291.6 294.7 (1)
PKS 1.0 4.7 (79) 8.5 49.5 (83)
Nitrogen fertilizers 515.4 477.3 +8 1,927.8 1,786.2 +8
Ammonium nitrate 191.7 73.4 +161 629.4 467.8 +35
Urea 318.8 396.1 (20) 1,253.4 1,308.0 (4)
Ammonium sulfate 4.9 7.8 (37) 44.9 10.4 +332

Russia May Extend Domestic Fertilizer Price Freeze Until May

News, News Briefs, Russia

Russia may extend its freeze on fertilizer prices until next May, Russia’s Vedomosti newspaper reported on Oct. 26, citing people familiar with the government’s discussions. An alternate option would be for Russian fertilizer producers to make agreements with individual regions, according to the report.

Earlier this month, the largest Russian fertilizer producers made a voluntary decision to extend a freeze on domestic prices through Dec. 31, the Russian Fertilizers Producers Association (RAPU) said in a statement, according to a Bloomberg report. Prices were fixed in July, initially until the end of October.

The measures are aimed at helping farmers buy nutrients for spring sowing as global prices for fertilizers continue to rise.

Last week, RAPU said while producers will prioritize domestic sales to meet domestic demand, they are able to boost output to satisfy additional European demand (GM Oct. 22, p. 33).

According to the producer’s association’s statement last week, as cited by Bloomberg, Russian farmers already have completed 95 percent of their fertilizer purchases for this year.

Brazil Farmers Seeing Fertilizer Deliveries Canceled

Brazil, News, News Briefs

Soybean farmers in the Center-West and Matopiba regions are reporting that some fertilizer and glyphosate deliveries have been canceled by suppliers, Bartolomeu Braz Pereira, who heads the farmers’ group Aprosoja, told Bloomberg.

“Some farmers are waiting for deliveries to start seeding,” he said, and retailers are saying fertilizer producers are citing a scarcity of raw materials. He said the biggest concern is for the winter-corn crop, as most farmers have not bought crop nutrients.

AdvanSix Back to Black in 3Q; AS Sales Up 85 Percent

News, News Briefs, Northeast

AdvanSix, Parsippany, N.J., reported third-quarter net income of $43.9 million ($1.51 per diluted share) on sales of $446.5 million, up from a year-ago loss of $692,000 ($0.02 per share) and $281.9 million. EBITDA was $75.2 million, up from $15.8 million.

Sales were up approximately 58 percent. Raw material pass-through pricing was favorable by 22 percent, following a net cost increase in benzene and propylene. Market-based pricing was favorable by 28 percent compared to the year-ago, driven by higher pricing across product lines. Sales volumes increased 8 percent, driven primarily by improved end market demand across ammonium sulfate, nylon, and caprolactam.

Ammonium sulfate sales were reported at $113.2 million, up 85 percent from the year-ago $61.2 million. They represent 26 percent of total sales during the quarter, up from 22 percent in the year-ago period. The company expects robust agricultural industry fundamentals to continue through the 2022 planting season.

Nine-month net income was $116.2 million ($4.02 per share) on sales of $1.26 billion, up from $19.3 million ($0.69 per share) and $817.6 million. EBITDA was $206.2 million, up from $75.1 million.

TFI Sets 4R Goals

News, News Briefs

The Fertilizer Institute (TFI) on Oct. 14 announced an industry-wide commitment to commit 70 million acres under 4R Nutrient Stewardship management by 2030. TFI said practices based on the right source, rate, time, and placement of fertilizer application can lead to improved on-farm profitability, improved water quality, and reduced loss of greenhouse gases.

“The sustainable use of fertilizer is not only a priority for the fertilizer industry, but for millions of farmers across the nation,” said Corey Rosenbusch, TFI President and CEO. “A key goal for the industry is a commitment to a healthy environment, and setting this goal to improved nutrient stewardship is an important step in meeting that goal.”

Last year, TFI’s Board of Directors and retail membership resolved to establish a 4R Acre target where retail members would contribute 4R acreage information to collectively meet the 70-million-acre goal by 2030. A 4R acre is defined as an acre of U.S. cropland under management using 4R practices, such as crediting organic sources and removal rates, variable rate technology, split applications, the use of cover crops, accounting for weather during application, etc.

Phosphorus Reduction Pilot Program Launched in Lake Erie Basin

News, News Briefs

Farmers in the Western Lake Erie Basin, which includes parts of Ohio, Michigan, and Indiana, can now earn money through a phosphorus load reduction pilot program. The Phosphorus Load-Reduction Stimulation Program (PLUS-UP), coordinated by the Conservation Technology Information Center (CTIC), will pay farmers in the project area $5-$10 per acre in 2022 to reduce phosphorus loads using practices such as no-till or cover crops.

“The PLUS-UP program will provide a financial incentive for conservation practices that help farmers reduce phosphorus loading in the Lake Erie watershed, keep their nutrients where their crops can use them, and build soil health,” said Hans Kok, CTIC Program Director. “Bayer Crop Science has purchased phosphorus credits to provide these PLUS-UP incentives, and the U.S. Environmental Protection Agency has supported the development of a market mechanism that could be sustainable well into the future.”

CTIC, the Bayer Carbon Program, and Heidelberg University said they will provide support to farmers on sustainable practices through educational materials, workshops, and one-on-one training. PLUS-UP payments now being offered to growers are intended to help offset their costs for the use of in-field practices such as cover crops and no-till, which help reduce the amount of dissolved reactive phosphorus (DRP) delivered to the watersheds that drain into Lake Erie.

“What we’ve been learning over time, especially with more recent algal blooms in Lake Erie, is that it seems like the smaller portion of phosphorus, the dissolved phosphorus that you can’t see, plays a critical role in bloom severity because it is way more bioavailable for algae,” said Laura Johnson, Director of the National Center for Water Quality Research at Heidelberg University. “And if we’re thinking of it in an agricultural context, dissolved phosphorus is the farmer’s crop available phosphorus.”

PLUS-UP payments will be based on Nutrient Tracking Tool (NTT) modeling results for the practices and conditions for each participating field. According to Johnson’s research, DRP runoff in the Western Lake Erie Basin averages 0.3 pounds per acre, while reductions are expected to be in the range of 0.05-0.1 pounds per acre. Based on those estimates, payments for
practices in the PLUS-UP pilot program will probably be approximately $5 per acre for cover crops, $3 per acre for no-till, or $10 for both practices employed together.

The first round of payments will be for practices put in place between the harvest of the 2021 cash crop and planting of the spring 2022 crop. Johnson’s team at Heidelberg University will calculate the reductions for each participating grower using the NTT model and report this to CTIC. The contract will call for payment to be made soon after planting of the 2022 crop.

Interested farmers can find more information and apply for PLUS-UP at https://ctic.org/projects/Sustainable_Supply_Chains/PLUS-UP.

FVC Launches New Biological Line

News, News Briefs, Specialty, Western Cornbelt

Frenchman Valley Co-op (FVC) in Imperial, Neb., on Oct. 14 announced the launch of Carbon Cycle™, a new biological that uses a collection of bacteria and amino acids to break down tough crop residue, speed up planting, and release nutrients faster.

“Carbon Cycle springs from our effort to test, refine, and make available new biologicals at a price point that can improve every farmer’s return on investmen),” said Ben Sauder, Vice President of Agronomy at FVC. “We are in a time of rapid advances with new biologicals, and we are happy to now provide this proven, beneficial technology to our growers.”

FVC said the need for Carbon Cycle stemmed from better genetics, faster planters, and higher yields. Average corn yields in America increased from 108.6 bushel per acre (BPA) in 1991 to 172 BPA in 2020, according to USDA. To grow and fill out heavier ears, corn stalks got stronger. To gain yield, plant populations went up, creating more residue. Meanwhile, FVC said planter speeds have doubled in recent years and 10-mph is now common.

“New planting systems are designed to get the crop planted inside tight weather windows,” Sauder said. “Anything that helps us move faster and still get even germination is key, and the added benefit is freeing up more nutrients in a timely way for the next crop.”

Carbon Cycle offers other advantages as well, according to Sauder. “Lighter residue means less fuel needed for tillage and easier planting, and there’s a big impact on fertility that’s really important when we are seeing increases in fertilizer prices,” he said. “Economic viability is the key component of sustainable crop production and that’s behind our development of these innovative biologicals.”

FVC said the blend of six proprietary microbes in Carbon Cycle boosts natural biological activity that releases field-available nutrients from crop residue faster. Initial data indicates increases of up to 30-40 pounds of nitrogen, 5-10 pounds of phosphorus, and 35-40 pounds of potassium per acre in the crop following Carbon Cycle application.

FVCis a full-service cooperative offering crop inputs, precision ag services, grain storage, grain marketing, energy, feed and hardware from 21 locations serving growers in southwestern Nebraska, northwestern Kansas, the Nebraska Panhandle, northeastern Colorado, South Dakota, and Wyoming.