All posts by Steve Seay

Ravensdown Site Re-Opens Oct. 11

Ravensdown’s Hornby location in Christchurch, N.Z., will be serving customers some 48 hours after a fire affected the eastern section of the 14 hectare site. Customers will be able to order and collect product starting at 8:00 a.m. Oct. 11.

No one was injured in the Oct. 9 fire, which severely damaged four of the company’s 13 storage buildings. The company said the fire started during some maintenance work and spread along the roof line when a rubber conveyor belt ignited. The company said the buildings were insured and will be replaced. The buildings were new fiberglass construction and did not contain asbestos.

The company said the fire did not impact the manufacturing part of the plant. It said the plant does not store explosives materials and that two small bangs heard during the fire were likely caused by gas bottles being used during maintenance work.

Major Fire at Fertilizer Plant Out

An Oct. 9 fire at Ravensdown’s Hornby manufacturing facility in Christchurch, N.Z., is out, according to the company. No injuries to the 57 employees were reported. However, the company said that while parts of the plant were badly damaged, manufacturing and dispatch operations seem undamaged. The company told the local press that it is looking at “many millions” in repairs.

“The fire started at the eastern end of our storage store but it’s too early to know the cause,” said CEO Greg Campbell. “We will be working closely with an investigation team to identify the cause.”

Campbell said Ravensdown was already working with its customers and transporters to keep them informed and help them with alternative supply options.

 

APC, Sinochem Macao Agree New Potash Supply Contract

Arab Potash Co. (APC) said Oct. 7 it had concluded a new potash supply contract with Sinochem Macao for the delivery of about 600,000 mt, including optional quantities, which will be shipped “during 2018 and part of 2019.” The volumes agreed are down on last year when about 700,000 mt of various grades were concluded, although last year’s contract settlement came earlier, in late July.

The Jordanian producer said the terms and conditions agreed are in line with current market prices and terms. Belarus Potash Co. (BPC) was the first supplier to settle a new seaborne contract price with China, on Sept. 17 agreeing a new price of $290/mt CFR with China’s buying consortium, comprising Sinochem, CNAMPGC and  CNOOC, for the deliveries through June 2019. It has been past practice for other suppliers to subsequently settle their seaborne supply contracts at the same price with China as the first supplier to reach a deal. Until now, BPC is the only supplier to officially announce a conclusion with China.

APC said the expected financial impact of the new China supply deal on the company before income tax, royalties and production costs is around JD125 million (approximately $176.3 million) spread over the years 2018 and 2019 based on the shipping schedule.

MMTC Said to Favor East Coast Deliveries

Sources reported Monday, Oct. 8, that the Indian government is focusing on East Coast deliveries from the MMTC tender that closed Oct. 5.

Dreymoor had the lowest offer into an East Coast port at $356/mt CFR. With a total cost package close to $20/mt, sources said the netback to China is $335-$337/mt FOB. While the price is significantly higher than what MMTC paid in its last tender, sources report Chinese producers are holding out for $340/mt FOB.

EuroChem Takes On Trammo’s U.S. Transport & Storage Assets

EuroChem Group AG, Zug, Switzerland, on Oct. 8 announced the expansion of its North American distribution network via the assumption of dry and liquid fertilizer transport and storage assets from international merchandising and trading firm Trammo Inc., New York City.

The fertilizer group said the move substantially expands its fertilizer storage capacity in the U.S., and will enable it to strengthen its presence into Western Canada as well as on the East Coast. EuroChem now operates 25 warehouses in the U.S. with a current storage capacity of about 500,000 mt.

It said the U.S. market accounted for about 11 percent of group sales in 2017. The group expanded its presence in the U.S. in October 2015 with the acquisition of Ben-Trei, a fertilizer distribution business historically focused on sales within the country’s heartland.

“The agreement with Trammo will substantially increase our storage capacity, while also broadening our geographic reach,” said EuroChem North America Managing Director Charlie Bendana. “It will support the ongoing expansion of our U.S. business, allowing us to fulfil growing demand from local farmers for high-quality fertilizers.”

BCIC Urea Tender Confirms Higher Prices

The BCIC urea tender for 100,000 mt of granular urea and 50,000 mt of prilled urea – both in bags – closed Monday, Oct. 8 with prices that confirmed levels more favorable to producers.

Four companies offered lots of 25,000 mt each in the granular tender with the lowest price coming from Swiss Singapore offering Chinese material at $399.00/mt CFR bagged. Three companies offered in the prilled urea tender, again with Swiss Singapore the lowest at $377.95/mt CFR.

Sources reported two other companies offered lower prices, but their offers seemed to have been discarded by BCIC. Agro-Industrial offered 25,000 mt of prilled at $365.87/mt CFR bagged. Hydro Carbon offered 25,000 mt of granular at $365.90/mt CFR bagged. Sources could not explain why these two companies were not included in the final tally released.

The package to bag, ship, insure and load/unload the product is pegged at $50/mt, for a netback for granular at $345-$350/mt FOB and prilled at $325-$330/mt FOB. The prilled price is markedly below the expectations of Chinese producers. At the same time, the granular netback surpassed the $335-$337/mt FOB estimated netback in the MMTC/India tender that closed Friday, Oct. 5.

MMTC Calls Urea Tender

The much-anticipated urea tender was called by MMTC Sept. 27. The tender will close Oct. 5 with offers to be valid through Oct. 12. Shipment is to be done by Nov. 19.

Sources said they do not expect to see a lot of Iranian material offered in the tender because of the U.S. sanctions against Iran. However, the tender documents do not preclude Iranian urea. The documents allow Iranian product to be offered with bills of lading from the UAE. International traders still raise questions as to how payment for the cargoes will be handled.

If Iran is excluded, traders expect to see Arab Gulf prices shoot to at least $350/mt FOB.