All posts by mickeybarb@charter.net

Pivot Bio Completes Lab, Offices

California, News, News Briefs, Specialty

Specialty producer Pivot Bio, Berkeley, Calif., reports the recent completion of a major expansion of its Berkeley lab and offices to support its accelerated growth plans, advance the company’s science, and deliver its nitrogen-producing microbial products to U.S. farmers faster. MAI Construction, San Jose, Calif., served as the general contractor.

“With the technical expertise of our partners at MAI, we created a best-in-class facility that will put Pivot Bio at the forefront of a growing bio economy,” said Karsten Temme, Ph.D., Pivot Bio CEO and co-founder. “The renovated and expanded space supports our team to do their best work in the best possible environment as we strive to develop regenerative agriculture solutions to help farmers and improve the health of our planet.”

Pivot Bio said since 2019 it has expanded its footprint by opening an added high-quality greenhouse space in Hayward, Calif., an office and product development lab at the Donald Danforth Plant Science Center in St. Louis, Mo., and a sales office in the Iowa State University Research Park, Ames, Iowa.

Landowner Seeks Removal of Magellan Ammonia Pipeline; Class Action Sought

Ammonia, News, News Briefs, Southern Plains

Oklahoma landowner Vic Bruns has filed suit seeking the removal of the idled 1,100 mile Magellan Midstream Partners LP’s anhydrous ammonia pipeline. The suit, which was originally filed in the Tulsa County District Court, was transferred to the U.S. District Court for the Northern District of Oklahoma late last month, with the plaintiff seeking class action status.

Magellan gradually halted ammonia shipments on the pipeline in 2019-2020 (GM Aug. 9, 2019; Feb. 1, 2019).

The plaintiff alleges that Magellan filed documents with the U.S. Department of Transportation’s Pipeline and Hazardous Materials Safety Administration saying that it had abandoned the pipeline and filled it with salt water or inert gas, and that it had been permanently disconnected and sealed. The plaintiffs added that the pipeline was permanently abandoned from Texas to Minnesota, effectively abandoning easements across the properties of landowners in five states.

Magellan’s position is that the easement was forever and did not address easement removal.

Bruns is seeking actual damages, comprising the cost to remove the pipeline and remediate the land, including placement of fill dirt, as well as the decrease in property value and the fair market value based on its use for the storage of the abandoned pipeline and related property.

Arianne Cuts Debt, Extends Credit Facility

Canada, News, News Briefs, Phosphate

Arianne Phosphate, Saguenay, Quebec, a development-stage phosphate mining company advancing the Lac à Paul project in Quebec’s Saguenay-Lac-Saint-Jean region, said on March 18 it has entered into an agreement with its senior secured lender, Mercury Financing Corp., by which the lender has agreed to exercise the 26,780,000 warrants that it currently holds, thereby reducing the amount owed under the credit facility by roughly $6.6 million to $24.9 million.

The lender has also agreed to extend the loan under the credit facility for a period of five years and reduce the annual interest rate to 8 percent from the previous 15 percent. In conjunction with the amended credit facility, the lender will receive 32 million non-transferable share purchase warrants, exercisable at a price of $0.33 per share for a period of five years.

Arianne also reported that it has entered into agreements with its subordinate unsecured debt holders amounting to a total of $5,970,155, whereby these debt holders have agreed to a conversion of their existing debt into common shares of the company at a price of $0.275 per share, representing the volume weighted average price of Arianne’s common shares on the TSX-V for the previous 30 trading days.

“This is very significant news for Arianne and its shareholders,” said Brian Ostroff, Arianne CEO. “By addressing this, Arianne has removed a significant concern of its shareholders and put the Company on a more solid foundation. This agreement allows Arianne to cut its overall debt by roughly a third, extend the maturity of its outstanding loan by a full five years, and cut the interest rate almost in half, which will save the Company close to $3 million a year in interest payments. This agreement also fully aligns the company and its lender, as Mercury through its decision to exercise its warrants, will now become a major shareholder of Arianne with over a 17 percent equity holding.

“This deal comes at an ideal time,” added Ostroff. “Over the last few years, Arianne has been able to weather a very difficult macro while many others have not. The company has advanced its Lac à Paul project to what is today, arguably a best of breed asset.

“Now, we are seeing a drastic improvement in the agricultural sector, with many grains trading at multi-year highs and improved conditions for farmers, along with tightness in markets, [which] has led to a significant increase in the price of phosphate fertilizers, with DAP prices having doubled in the last year,” Ostroff continued. “Arianne should now be very well-placed to take advantage of its position and advance its project, thus unlocking substantial returns for its investors and stakeholders.”

Mosaic Touts Transformation Efforts; Eyes Growth in Brazil, Specialties

Brazil, Featured, News, Specialty, Tampa

Mosaic Co., Tampa, recently outlined for analysts its optimization of operating assets, with President and CEO Joc O’Rourke saying, “the North American business is delivering production and cost improvements that were almost unthinkable a decade ago.

“Two significant highlights are the new integrated operations center in phosphates, which is efficiently and safely running our Four Corners field operations today, and our continued accelerated progress at Esterhazy as we near completion,” he continued. Esterhazy 3 is expected to be fully operational by mid-2022, with O’Rourke saying it would represent the delivery of this project over two years earlier than originally planned while remaining on budget.

When K3 ramps up, O’Rourke said the cash cost will be $50-$55/mt, almost $30-$40/mt less than when the company decided to proceed with the project. It will also add about 900,000 mt/y in tonnage and eliminate some $200 million in brine inflow costs.

O’Rourke said Mosaic is not expected to build a new phosphate mine in Florida anytime soon, citing plentiful reserves and next-generation technology. “One of the big things there is these guys when you talk about innovation, they are now pumping almost 20 miles from the drag lines to the plants,” he said. “That was unheard of a decade ago.

“So bottom line, we are continuously pushing out the need for new mines,” he said, adding that some of the investments the company had been talking about five or ten years ago have been pushed off decades.

Mosaic said the highwater mark for capital expenditure should come in this year at $1.1 billion, declining to $800 million in 2025. The company expects consolidated adjusted EBITDA to grow from 2020’s $318 million to $700 million in 2023.

O’Rourke mentioned two things that could change the capex scenario – M&A and the need to grow the premium product category, with MicroEssentials production capacity becoming a possible limiting factor. The company said it had record-setting growth in specialty products in 2020 to 4 million mt, and it expects 30 percent growth with a 2023 target of 5.2 million mt.

“Our collaboration with companies like Anuvia Plant Nutrients, Bio-Consortia, and Sound Agriculture, while still very early in the process, shows our commitment to expanding our specialty product portfolio over time to meet grower needs while also promoting solid health and sustainability,” he added.

O’Rourke noted that Mosaic Fertilizantes had record-setting financial results in 2020, delivering the best annual earnings and adjusted EBITDA since the acquisition from Vale despite year-over-year declines in average MAP selling prices. “We expect continued growth on many fronts as we look to the future with the combination of stronger grower economics, efficient assets, and our well-positioned distribution business, as well as the benefit of solid execution,” he said.

O’Rourke added that there is a great opportunity to expand the company’s distribution into northwest Brazil. “That’s where agriculture is growing, and it is growing quite rapidly there.” O’Rourke also noted the government of Brazil’s desire to have more domestic fertilizer production, and suggested that the government may do something about interstate taxes that have been restrictive. He added that there is a big advantage to having in-country production, which Mosaic already has, and he said he believes there are opportunities there.

Even though Tampa ammonia prices have been going up, O’Rourke said that right now the “CF contract is in the money.” As a result, he said that under its contract, it expects to push to take more under its 600,000-800,000 mt/y supply contract from CF, meaning the company will pick up more tons at a price below the market.

When prices were lower, he said the contract tons were under water. He said the ratios will change, but that overall the company would maintain its plans to buy about one-third of its ammonia from CF under a formula-based contract, one-third from its own Louisiana production, and one-third from the open market.

PhosAgro New Ammonium Phosphate Plant Start-Up at Volkhov: Clarification

DAP/MAP, News, News Briefs, Russia

As reported in last week’s issue of Green Markets, Russian fertilizer group PhosAgro has completed the first stage of its investment project for the development of a new production complex at Volkhov in Russia’s Leningrad region (GM March 12, p. 33). In an English-language media statement on March 16, the producer said it has launched a new MAP production facility with capacity of 231,000 mt/y (a capacity of 288,500 mt/y was reported in the previous article), with the production of the first pilot batch of MAP.

This first phase of development also includes a finished product warehouse of 15,000 mt (not 12,000 mt, as previously reported).

Under the second phase of development, which PhosAgro expects to be completed by 2023, existing fertilizer production facilities at the fertilizer production site number 2 at Volkhov will be upgraded and pivoted to MAP production. This, together, with other upgrades, will enable the group to increase total fertilizer production at the site to 774,000 mt/y.

“Once the investment project is fully completed, an entirely new production complex will be created on the site of the old plant, which was built in 1932, and total MAP production will reach 870,000 mt/y, using the best available technologies,” said PhosAgro.

ICL Group – Management Brief

Israel, Management Briefs

ICL Group, Tel Aviv, has named Chris Millington to the position of Executive Vice President of Food and Specialties for the Phosphate Solutions division. In addition, Gadi Lesin will be joining ICL’s Board of Directors as an independent director.

ICL said Millington has more than 25 years of global experience transforming B2B and B2C businesses in North America, Europe, and Asia Pacific, with a food and beverage background spanning all major segments and categories, including alternative proteins and natural ingredients.

Millington most recently served as the U.S.-based Global President of the flavor division of Firmenich, the largest privately-owned perfume and taste company in its industry. He also spent 13 years with Nestle in various, increasingly senior, global positions, and had responsibility for innovation in food service and all global beverage brands.

Millington is replacing James Moffatt, who is retiring in March after 39 years with the company, most recently as Executive Vice president of the ICL Phosphate Specialty business.

From 2009 to 2018, Lesin served as President and CEO of Strauss Group, an international food and beverage company and the largest food company in Israel.

“As ICL continues to focus on growing its food specialties business, Chris and Gadi’s addition to the company reinforces our commitment to the growth engine strategy we presented during our investor conference last September,” said Raviv Zoller, ICL President and CEO.

Bunge Ltd. – Management Brief

Management Briefs

Bunge Ltd., St. Louis, reports that Raul Padilla, Head of Global Operations, is retiring on Dec. 31, 2021. His responsibilities will be split between Brian Zachman, President of Global Risk Management, and Julio Garros, who was most recently responsible for transformation and new business initiatives.

Padilla joined Bunge in 1997 as Commercial Director. He has held various roles, including CEO of Bunge in South America and Managing Director of the company’s Global Agribusiness unit.

Garros, who has been with Bunge for 19 years, will take over milling and industrial operations, as well as responsibilities for external relationships within South America.

Zachman will oversee Padilla’s duties for the crush business, in addition to his current role.

Kore Potash Plc – Management Brief

London, Management Briefs

Junior miner Kore Potash Plc, London, which has a project in the Republic of Congo, announced on March 11 that CFO Andrey Maruta has notified the company of his plans to resign and join another company. He will continue to work for the company through his contractual notice period (three months), with his last day being June 10. He has been CFO since Aug. 30, 2019.

The company said it will update shareholders on his replacement in due course.

Fertilizer Canada Launches Fertilize SAFE

Canada, News, News Briefs

Fertilizer Canada, Ottawa, on March 15 launched its new safety and security brand, Fertilize SAFE, to mark Canadian Agriculture Safety Week.

The organization said the program brings all of Fertilizer Canada’s mandatory, audited safety codes and training resources under one umbrella brand to emphasize its industry commitment to keeping employees, farmers, first responders, and the public safe and secure.

A best-in-class safety stewardship program, Fertilize SAFE unifies the organization’s efforts to educate, enable, and empower those in the fertilizer supply chain. Through industry-enforced codes of practice, educational resources, and training tools, Fertilize SAFE helps define safety and security for all industry players.

The SAFE in Fertilize SAFE is an acronym that captures the program’s four pillars, Standardized Codes of Practice, Accessible Training Resources (for the entire supply chain), Focused Industry Education, and Early and Enforced Industry Adoption.

“For over ten years, Fertilizer Canada has proactively developed safety and security initiatives,” said Clyde Graham, Fertilizer Canada Executive Vice President. “Formalizing under the Fertilize SAFE brand, we can more readily communicate and deliver all-encompassing programming.

“By creating a visual identity and a name, we hope to further establish credibility and brand recognition in the safety and security domain. Our members are incredibly diligent about safety and security, and stakeholders, government officials, and the public must recognize the proactive and comprehensive programming Fertilizer Canada offers,” Graham added.