All posts by mickeybarb@charter.net

Mosaic Fertilizantes Volumes Up in Jan-Feb.

Brazil, Earnings, News, Phosphate, Potash

Mosaic Fertilizantes posted a 31% increase in sales volumes for January-February 2023 compared with last year, according to results released by Mosaic on March 29. Sales revenues for the segment were up 12%, to $971 million from the year-ago $870 million.

Mosaic’s Potash and Phosphate segments also saw volume increases, but sales revenues were down from the year-ago period.

For the first quarter 2023, Mosaic expects total potash sales volumes to be near the lower end of the previously guided range of 1.8-2.0 million mt, with realized MOP pricing at the mine in the range of $400-$440/mt.

First-quarter phosphate guidance remains unchanged, with sales volumes in the range of 1.7-1.9 million mt and realized DAP prices on an FOB basis in the range of $625-$675/mt.

Potash Jan/Feb 2023 Jan/Feb 2022
Sales Volumes in thousands of mt 1,100 1,048
Sales Revenues in millions $542 $604
Phosphates Jan/Feb 2023 Jan/Feb 2022
Sales Volumes in thousands of mt 1,066 999
Sales Revenues in millions $827 $873
Mosaic Fertilizantes Jan/Feb 2023 Jan/Feb 2022
Sales Volumes in thousands of mt 1,462 1,118
Sales Revenues in millions $971 $870

Senate Passes Resolution to Overturn WOTUS; Biden Plans to Veto

Featured, News, U.S.

The US Senate on March 29 voted 53-43 to approve a resolution overturning the Biden Administration’s “Waters of the United States” (WOTUS) rule. The vote follows a similar resolution passed by the House in late February (GM March 3, p. 26), which called the new WOTUS definition “flawed” and “overreaching.”

“We are sending a clear, bipartisan message that Congress, even a divided one, will defend working Americans in the face of executive overreach,” said Sen. Shelley Moore Capito (R-W.Va.), a bill sponsor and the top Republican on the Environment and Public Works Committee. “I urge President Biden not to overrule the will of a bipartisan majority in Congress, and instead draft a new rule that doesn’t unfairly penalize millions of Americans and jeopardize future growth in our country.”

Sens. Joe Manchin (D-W.Va.), Catherine Cortez Masto (D-Nev.), Jacky Rosen (D-Nev.), and Jon Tester (D-Mont.) voted for the bill, as did Sen. Kyrsten Sinema (I-Ariz.). Not voting were Sens. Chris Coons (D-Del.), Dianne Feinstein (D-Calif.), John Fetterman (D-Pa.), and Minority Leader Mitch McConnell (R-Ky.).

The earlier House resolution passed on a bipartisan 227-198 vote. Because neither chamber’s vote reached the two-thirds threshold, however, the White House has said President Biden plans to veto, Bloomberg reported.

Officially announced on Dec. 30 (GM Jan. 6, p. 1) by the US Environmental Protection Agency (EPA) and the Army Corps of Engineers, the new WOTUS rule claims to restore protections that were in place prior to 2015 under the Clean Water Act (CWA), but with “updates to reflect existing Supreme Court decisions, the latest science, and the agencies’ technical expertise.” The rule was published in the Federal Register on Jan. 18 and took effect on March 20.

Republicans are seeking to replace the rule with a bill introduced by Rep. Mary Miller (R-Ill.) and Sen. Mike Braun (R-Ind.) earlier this month that would narrow the WOTUS regulation, excluding rain-induced “ephemeral waters” and other small waterways from federal jurisdiction under the CWA.

“I am introducing the Define WOTUS Act with Senator Mike Braun to protect my fellow farmers and stand against the disastrous Biden EPA, which is working to regulate every pond and puddle in America,” Miller said in a March 10 statement.

The debate over which water bodies should be classified as WOTUS – and therefore under CWA jurisdiction – has been raging for 15 years, with the definition narrowing or expanding depending on the administration. Critics said the Biden rule essentially reinstated an Obama-era regulation that provided an expansive view of what qualifies as federal navigable waters, including wetlands and other smaller bodies of water.

The US Supreme Court heard oral arguments on the issue in October in Sackett v. EPA and is expected to rule on the case this year. The White House has pushed back against critics (GM March 10, p. 1), saying the new rule isn’t much different from the status quo, and any effort to overturn it would only increase uncertainty over water regulation and threaten economic growth, agriculture, and clean water in various jurisdictions.

OCP Posts Record Earnings in 2002 Despite Lower Export Volumes

DAP/MAP, Earnings, Morocco, News, NPK, NPS, Triple Superphosphate

Casablanca-based OCP Group SA reported a 73% increase in net income for the year ending Dec. 31, 2022, to MAD28.2 billion ($2.76 billion), the highest since its establishment over a century ago. The earnings were boosted by higher global fertilizer prices following Russia’s invasion of Ukraine.

Full-year EBITDA increased 38%, to MAD50.08 billion ($4.93 billion) on revenues of MAD114.57 billion ($11.28 billion), up from MAD36.27 billion ($4.04 billion) and MAD84.3 billion, respectively, for the previous year, and in line with preliminary results released by the group at the beginning of March (GM March 3, p. 24).

Gross profit in local currency was up by 27%, reaching MAD70.38 billion ($6.93 billion) from MAD55.22 billion ($6.12 billion) last year. Revenue in local currency grew 36% year-over-year, with the group citing higher prices across all product categories, which more than offset lower sales volumes compared to FY2021.

“OCP was able to fully leverage the benefits of higher prices, while calibrating production to match the attendant lower volumes, and effectively managing through the anticipated sequential easing of prices in the second half of the year,” the company said in its March 28 earnings statement.

“The strong double-digit revenue growth in 2022 was led by a 44% increase in fertilizer revenues, which accounted for a record 64% of total revenues for the year, up from 61% a year ago,” the group noted.

Higher global prices for fertilizer products helped mitigate the impact of lower export volumes in most regions due to reduced demand amid lower farmer affordability. The group’s fertilizer sales volumes fell 11% year-over-year, to 9.3 million mt from 10.4 million mt.

OCP fertilizer exports by product

  FY2022 FY2021
Total (million mt) 9.3 10.4
Percentage of total    
DAP/MAP 66% 66%
TSP/NPS 27% 23%
NPK 7% 11%

Phosphate rock revenues were up 51% year-over-year in local currency, mainly reflecting improved prices. Phosphoric acid revenues in local currency increased by a modest 1%, OCP said, with lower export volumes offset by higher phos acid prices.

Fourth-quarter EBITDA declined by 40%, to MAD7.11 billion ($615 million) from the prior-year MAD11.79 billion ($1.30 billion). Gross profit for the quarter dropped by 18%, to MAD14.14 billion ($1.32 billion) from the year-ago MAD17.34 billion ($1.89 billion), while revenue fell by 6%, to MAD25.04 billion ($2.33 billion) from MAD26.65 billion ($2.91 billion).

The group attributed the fourth-quarter downturn to less favorable market conditions compared with the same period in 2021, which resulted in lower prices and a contraction in demand.

For the months ahead, OCP sees “a seemingly balanced market in 2023, with a partial recovery of demand and relatively constrained supply.” The group highlighted an expected recovery in the Americas “due to crop prices that remain at high levels relative to fertilizer prices,” and a moderate recovery in demand in Europe, albeit with “hand-to-mouth” purchasing.

Additionally, OCP anticipates an increase in demand in Africa due to the group’s initiative “to prioritize this market and avoid demand destruction due to price.” The group also expects imports into India to remain stable amid government elections in 2024 and relatively low starting stocks.

On the supply side, OCP expects Chinese exports to reach higher levels this year than in 2022, but below the record set in 2021. The group said its new TSP capacities in Morocco will be deployed “gradually and coordinated with market recovery.”

For full year 2022, OCP plans to pay a dividend of MAD98.5 (approximately $9.74 at current exchange rates) per share, some 60% higher than the prior year. With the Moroccan state holding some 94% of OCP’s capital, Morocco’s government is set to receive a windfall of about $750 million from OCP dividends this year, according to Bloomberg.

Greenpoint Ag – Management Brief

Management Briefs, South Central

Greenpoint Ag (GPAH), Decatur, Ala., on March 30 announced the creation of Procurement Managers in the company’s CN Wholesale Department. Ross Trull will be Phosphates and Potash Manager, Jourdan Causseaux will be Nitrogen Manager, and Lanze Ezell will be running the Micronutrients and Biological book.

All three have been with GPAH since its inception. Trull and Causseaux were previously with Agri-AFC, Trull for more than a decade and Causseaux since 2016. Ezell was previously with the Alabama Farmers Cooperative system for 18 years.

Fertinal – Management Brief

Management Briefs, Mexico

Mexico’s Grupo Fertinal announced that Marbet Angulo Rodriguez, who has been serving as Commercial Director, was promoted to the position of CEO as of March 16, 2023. José Luis Valencia, who has been handling logistics for the company, will now be in charge of the Office of the Commercial Direction. The company said he has more than 20 years of experience in the fertilizer industry.

Meristem Crop Performance Group LLC – Management Brief

Eastern Cornbelt, Management Briefs

Crop inputs supplier Meristem Crop Performance Group LLC, Columbus, Ohio, announced on March 30 that Certified Crop Consultant Brewer Blessitt, CPAg, Ph.D., founder of Blythe Bayou Research and Consulting (BBRC), has joined Meristem to support product research and development.

Blessitt joined DuPont Pioneer (now Corteva) in 2013, first as a product agronomist and then as a technical product manager. He also worked as a Mississippi State University research associate for eight years. In addition to his role with Meristem, he will continue his agronomic consulting across 40,000 acres in the Southeast region.

“Dr. Blessitt will play a key role helping us widen the pathway for new, innovative technology that helps farmers increase nutrient-use efficiency, grow big, healthy plants fast, optimize genetic potential all season long, and gain more bushels for less,” said Mitch Eviston, Meristem Founder and CEO.

Russia Raises AN Export Quota; May Extend Fertilizer Quotas by Six Months

Ammonium Nitrate, Featured, News, Russia

The Russian government has increased the export quota for ammonium nitrate (AN) by 300,000 mt, according to an Interfax report, citing a government press service statement. The increase is aimed at allowing Russian fertilizer producers to export surplus product, provided that the needs of the domestic market are met in full, according to the statement.

The quota on AN exports was originally 225,000 mt from Jan. 1-March 31 and 828,500 mt from April 1-May 31. In late January, the government increased the AN export quota by 375,000 mt (GM Jan. 27, p. 1).

With this week’s increase, the total export quota for certain types of fertilizers that runs until May 31 will now exceed 12.6 million mt. In addition to AN, the current export quotes mainly apply to urea and UAN, as well as to compound fertilizers.

The Russian government is also looking to extend export quotas on certain types of fertilizer for another six months beyond May 31 to help support the domestic market, according to another Interfax report, citing Agriculture Minister Dmitry Patrushev.

According to this week’s report, Russia’s Industry and Trade Ministry and the Federal Anti-Monopoly Service are working on the extension of the current set of measures to Nov. 30, 2023, as well as on fixing the selling prices on the domestic market.

Russia first introduced quotas for the export of nitrogen and complex fertilizers on Dec. 1, 2021 (GM Nov. 5, 2021). They were due to expire on May 31, 2022, but the Russian government extended the quotas to run from July 1 to Dec. 31, 2022. Last December, Moscow extended the export quotas to run until May 31, 2023 (GM Dec. 23, 2022).

TFI Praises Legislation Supporting Ag Research

News, News Briefs, U.S.

The Fertilizer Institute (TFI) President and CEO Corey Rosenbusch on March 30 praised Congress for introducing the Advancing Cutting Edge (ACE) Agriculture Act, which TFI said will help farmers by focusing United States Department of Agriculture (USDA) research on critical areas such as soil health and increasing crop yields.

“With our global population expected to hit 10 billion people by 2050, farmers are constantly being asked to do more with less, while also being good environmental stewards by taking care of the land that takes care of us,” Rosenbusch said. “The fertilizer industry puts a strong focus on research and the farmer adoption of 4R Nutrient Stewardship practices and other methods that improve soil health, encourage the responsible and efficient use of fertilizer, increase crop yields, and minimize impacts to the environment, and welcomes additional government research into these areas.”

Introduced in the Senate on March 16 by Sens. Michael Bennet (D-Colo.) and Roger Marshall (R-Kan.), and in the House of Representatives on March 29 by Reps. Jimmy Panetta (D-Calif.) and Randy Feenstra (R-Iowa), the ACE Agriculture Act would double the authorization of existing programs from $50 million to $100 million to ensure access to agricultural innovation projects across multiple states.

Rosenbusch highlighted the fertilizer industry’s 4R Research Fund, as well as independent research that has focused on multiple crops, geographic locations, and methods to show farmers the beneficial outcomes of new technologies and farming practices. He said TFI is a year and a half into a nationwide goal of having 70 million US farming acres under 4R nutrient stewardship management by 2030.

“We’ve done the research and know that these practices have both environmental and economically beneficial outcomes associated with their implementation,” Rosenbusch said. “But these practices are not one-size fits all, and not only is each farm different, but each acre on each farm is unique and growers need to feel confident when implementing new practices. We believe more research directly from the USDA on these critical issues can only help farmers continue growing that confidence and lead to wider farmer adoption.”

ARA Applauds Lower Energy Costs Act

News, News Briefs, U.S.

The Agricultural Retailers Association (ARA) on March 30 applauded the US House of Representatives for voting to adopt the Lower Energy Costs Act (H.R. 1). According to the bill’s sponsors, H.R. 1 will increase domestic energy production, reform the permitting process for all industries, streamline energy infrastructure and exports, and boost the production and processing of critical minerals.

“ARA strongly supports H.R. 1, the Lower Energy Costs Act, which is necessary legislation that will reform the National Environmental Policy Act (NEPA) and expedite mining, energy, and infrastructure projects to help lower America’s energy costs and boost our economy,” said Richard Gupton, ARA Senior Vice President of Public Policy & Counsel.

H.R. 1 was passed on March 30 almost entirely along party lines on a vote of 225 to 204. ARA is among more than 100 stakeholders to endorse the legislation, but the bill has little chance of even being considered in the Democratic-controlled Senate, the New York Times reported.

The Executive Office of the President also issued a statement on March 27, saying the administration “strongly opposes this bill” and that it would be vetoed by President Biden if presented in its current form.

Nevada Zinc’s Pilot Plant Produces Zinc Sulfate

News, News Briefs

Toronto-based Nevada Zinc Corp. on March 29 announced the successful production of high-grade zinc sulfate monohydrate from its pilot plant project in central Nevada. The company said the pilot plant process can be scaled to the company’s projected production levels using commercially available equipment.

The company’s zinc sulfate production initiative commenced in March 2021, initially as a bench scale test. Continuous production of zinc sulfate monohydrate, a micronutrient fertilizer, has now been achieved from the multi-phase pilot plant project being conducted by Hazen Research Inc. from sample material provided from the company’s Lone Mountain property in Nevada.

Hazen is currently completing an economic evaluation of the pilot plant process in order to generate operating and capital costs for a commercial-scale plant initially capable of processing 500 mt/d of open pit ore from the deposit. A final report including process flow diagrams and the project’s economic evaluation will then be vetted by an independent Qualified Person as defined by NI 43-101. This vetting process is projected to be completed in April 2023.