Eastern Cornbelt:
The last 10-34-0 prices were reported at the $450-$460/st FOB level for limited fill offers in the Eastern Cornbelt.
Western Cornbelt:
10-34-0 was steady at $655-$675/st FOB in the Western Cornbelt for the last confirmed prompt offers.
Southern Plains:
10-34-0 was down to $460/st FOB in Texas and the Southern Plains for the last confirmed business, with the 11-37-0 market dropping to the $500/st FOB level in Texas, down from spring pricing in the low-$700s/st FOB.
US Gulf:
Repairs to the BNSF railroad bridge at Mile 1 of the Port Allen Route, previously on the books for July 17 through Aug. 14, were pushed back to early September, sources said. Firm dates were expected to be announced closer to the start of the project.
Port Allen Lock was slated to undergo a full 48-hour shutdown on July 20-22 due to low water conditions. The closure was previously put on hold while the Corps waited for a dredge to become available. Harvey Lock remained shut to navigation during the week due to reverse head conditions. The lock was taken offline on June 15.
Guidewall repairs at Bayou Sorrel Lock limited navigation daily from 7:00 a.m. to 4:00 p.m., forcing waits up to 23 hours. The project was scheduled to run into March 2024.
Chamber wall repairs at Leland Bowman Lock began on July 18, blocking travel from 7:00 a.m. to 5:00 p.m. through July 31. Equipment delays pushed the project back from its original July 10 start date, sources said. Daytime shutdowns were expected at Brazos Lock starting on July 24, blocking travel between 7:00 a.m. and 7:00 p.m., Monday through Friday.
Waits ran up to five hours at both Port Allen Lock and Industrial Lock through the week. Sources reported intermittent 10-hour delays at Leland Bowman Lock.
Mississippi River:
Improving river levels allowed for lighter draft restrictions on the upper and middle sections of the Mississippi River during the week. Barges loading at St. Louis saw drafts reduced by 10%, while drafts were cut by 5% on barges loading between Cairo, Ill., and St. Louis.
On the lower river, northbound tows loading at New Orleans and southbound cargoes loading at Cairo saw maximum drafts slashed by 20%, sources said, while barge counts for tows traveling downriver were reduced by 15-25% between Cairo and NOLA, stretching delivery times by 24-48 hours.
The river gauge at St. Louis was posted at 1.84 feet and falling on July 19. Forecasts predicted a move below the 0.00-foot mark on July 24, followed by a (-)2.40-foot reading on Aug. 2. On the lower river, the Memphis gauge stood at (-)4.45 feet. Forecasters expected area levels to recede below the (-)5.00-foot low-stage threshold on July 27, with the gauge sinking to (-)6.80 feet by Aug. 2.
Sources reported dredging at Mile 16 and Mile 171 on the upper river. Minimal disruptions to navigation were reported at Mile 171, while a number of 24-hour shutdowns were expected at Mile 16 through the week. On the lower river, sources said dredging resumed at Mile 525 on July 17, with delays of 24-36 hours expected.
Repairs at Old River Lock that began on July 10 were scheduled to close the site to navigation on July 31-Aug. 3, Aug. 14-17, and Aug. 21-24.
Illinois River:
Low water levels continued to necessitate a 5% reduction in maximum loading drafts on the Illinois River. Wickets were raised at both LaGrange Lock and Peoria Lock due to the conditions, forcing tows to lock through both locations.
Brandon Road Lock, Dresden Island Lock, and Marseilles Lock are shut through approximately Oct. 1 for planned repairs and maintenance, effectively closing the river to commercial navigation.
Ohio River:
Maximum loading drafts continued at 10.0-10.5 feet due to low water levels on the Ohio River. On the Monongahela River, drafts were limited to 8.5 feet, sources said.
Shutdowns were scheduled at the John T. Meyers Lock primary chamber through Aug. 20 for repairs to the floating mooring system. The secondary chamber will close Aug. 21-Sept. 10 for miter gate work, followed by another round of main chamber closures from Sept. 11 through Nov. 17.
Auxiliary chamber outages were expected at New Cumberland Lock until Aug. 18, while the Melville Lock secondary chamber was reported offline through Aug. 4. Travel through the auxiliary chamber at McAlpine Lock is unavailable until Aug. 18.
Mandatory assist boat usage continued on southbound movements through Smithland Lock due to strong outflows, sources said. The site’s land chamber is due to shut between Sept. 22 and Oct. 21 for miter gate machinery repairs, followed by a river chamber closure on Oct. 22-Nov. 20 for machinery replacement.
The Greenup Lock main chamber is offline from July 5 through Aug. 14, prompting travel through the auxiliary chamber. On the Tennessee River, tows waited up to 31 hours to pass Kentucky Lock. Delays ran as high as seven hours at Wilson Lock.
Filip Grzegorczyk, Vice President of the Management Board of Grupa Azoty SA, has assumed the role of Vice President at Brussels-based Fertilizers Europe, which represents the majority of Europe’s major fertilizer manufacturers. The current term of the Fertilizers Europe Board runs until 2024.
Mumbai-based UPL, a global provider of crop protection and other specialty agricultural chemicals and biosolutions, announced that David C. Elser has been appointed as Regional Head for North America. UPL said Elser has extensive industry experience through various leadership positions, with expertise in customer-focused initiatives, agronomic solutions development, diverse product portfolio management, and strategic supply chain operations.
Port of Açu, the largest deep-water industrial port complex in Latin America, has signed a partnership with Japanese-Brazilian company Toyo Setal to jointly develop a nitrogen fertilizer plant at the company’s port site in São João da Barra, in northern Rio de Janeiro, according to Valor International and Port of Açu’s LinkedIn page.
The companies will work together in structuring, developing, licensing, and finding strategic investors for a future plant with an estimated capacity of 1.38 million mt/y of urea and 781,500 mt/y of ammonia.
The plant will use natural gas as the feedstock for the first phase, using Petrobras’s Route 3 gas pipeline, with the possibility of producing blue and green fertilizers from hydrogen in the next phases, Port of Açu said. This year, Port of Açu began the environmental permit process for a low-carbon hydrogen cluster in Açu with an installed capacity of 4 gigawatts.
“The partnership with Toyo Setal allows us to take a step forward in our strategy to establish Açu as a fertilizer production hub in Brazil, contributing to the expansion of domestic production and balancing our dependence on imports,” said José Firmo, CEO of Port of Açu.
Toyo Setal was founded in 2012 as a partnership between Japanese company Toyo Engineering Corp. and the Brazilian firm Setal Óleo e Gás. According to Valor International, Toyo Setal uses its own technology to produce urea and has partnerships with other companies to produce ammonia, with 87 ammonia and 112 urea projects currently in its global portfolio.
Port of Açu began handling fertilizers in 2021, Valor International reported, when it carried out the first operation in the state of Rio de Janeiro. The port has handled about 100,000 mt of fertilizer since then, and added two more warehouses this year, quadrupling storage capacity to 110,000 mt and doubling the terminal’s bonded area to 360,000 square meters.
CHS Inc. on July 13 reported third-quarter net income of $547.5 million, down from last year’s record $576.6 million. Nine-month net income for the company climbed to $1.6 billion on revenues of $36.1 billion, however, up from last year’s $1.2 billion and $34.4 billion, respectively.
Favorable market conditions boosted the company’s Energy segment in the third quarter, while lower prices weighed on margins in CHS’s Ag business.
“Consumer demand remains strong for energy and oilseed products, and our joint venture investments continue to contribute to strong earnings and round out our well-diversified portfolio,” said Jay Debertin, CHS President and CEO. “As we enter the end of our fiscal year, opportunities remain for profitability and growth in the agriculture industry, and CHS is well-positioned to maximize value for our member cooperatives, farmer-owners and customers.”
The company’s Energy segment posted pretax earnings of $199 million for the third quarter, up $35.8 million from last year, fueled by strong refining margins and favorable pricing in CHS’s refined fuels business. The higher margins were partially offset by decreased fuels production volumes due to planned maintenance at CHS’s Laurel, Mont., refinery, however.
The company’s Ag segment posted third-quarter pretax earnings of $233.5 million, down $40.2 million from last year’s third quarter, due to market-driven price decreases and lower margins, particularly for wholesale and retail agronomy products. Strong meal and oil demand contributed to increased margins in CHS’s grain and oilseed and processing product categories, however.
CHS reported that its CF Nitrogen investment delivered pretax earnings of $56.3 million during the quarter, down $121.9 million from last year due to lower equity income attributed to decreased market prices for urea and UAN.
CHS’s Corporate and Other segment reported pretax earnings of $69.3 million for the quarter, up $45.8 million from last year due to improved equity income from the company’s Ventura Foods joint venture and increased interest income due to higher interest rates.
Nine-month earnings by segment included Energy at $860 million, up from $243 million last year; Ag at $439 million, down from last year’s $615 million; Nitrogen Production at $235 million, down from $429 million last year; and Corporate/Other at $154 million, up from $48.6 million last year.
Incitec Pivot Ltd. (IPL) confirmed that it has received a number of approaches for the potential acquisition of its fertilizer business. The news follows speculation that the group may be considering a potential sale amid doubts over whether its plan to spin-off Incitec Pivot Fertilisers (IPF) and the Dyno Nobel explosives business into standalone companies will succeed.
IPL in a July 12 Australian Securities Exchange (ASX) release said its Board is considering a potential sale alongside the ongoing proposal to structurally separate IPF and the Dyno Nobel explosives business, and that it will continue to assess all options “to ensure shareholder value is maximized.”
IPL’s shares jumped as much as 8.3%, the most since Nov. 15 last year, after the Melbourne-based group confirmed the unsolicited interest from potential buyers. IPL stressed that discussions are incomplete, however, and there is no certainty that any agreement will be reached or that any transaction will occur.
IPL declined to identify any interested parties, but The Australian Financial Review reported on July 11 that at least one Asia-based, state-owned enterprise has shown interest in buying IPF, with speculation focused on Pupuk Indonesia, a large fertilizer producer in the region, according to the report.
IPF is the largest distributor of fertilizers by volume in Australia, supplying 1.869 million mt to the domestic market in FY2022, down from 2.235 million mt in FY2021. It is the country’s sole manufacturer of phosphate fertilizers, producing 735,900 mt in FY2022 and 958,400 mt in FY2021.
IPL no longer produces its own urea following the closure of its Gibson Island plant in Brisbane at the end of 2022. It made the decision in late 2021 after being unable to secure “an economically viable” long-term gas supply to the facility beyond Dec. 31, 2022, when the existing contract ran out (GM Nov. 12, 2021).
However, IPL has lined up a 20-year offtake agreement for 2.3 million mt/y of granular urea from Perdaman Chemicals and Fertilisers Pty Ltd.’s Karratha plant, which is under construction on Western Australia’s Burrup Peninsula and expected to be commissioned in mid-2027 (GM April 21, p. 1).
IPL’s long-standing plan to separate its fertilizer business and Dyno Nobel has appeared increasingly uncertain after the departure last month of IPF CEO designate Christine Corbett (GM June 16, p. 26). IPL also announced in early June that its Managing Director and CEO Jeanne Johns was stepping down at the end of the month (GM June 9, p. 26).
IPL’s Fertilisers Asia Pacific saw a first-half EBIT decline of 58%, to A$107.7 million from A$256.9 million last year, mainly due to lower selling prices and softer demand, as well as higher costs (GM May 19, p. 24). Those cost pressure include buying natural gas on the spot market for its Phosphate Hill ammoniated phosphate fertilizer operation in Queensland after gas supplier Power and Water Corp. (PWC) declared a reserve shortfall.
As of June 9 (GM June 9, p. 25), IPL said it expects the total FY2023 EBIT impact from sourcing shortfall gas to be A$75-$90 million (approximately US$50-$60 million at current exchange rates).
The Dyno Nobel business has been faring better. Dyno Nobel Americas reported a 55% increase in first-half EBIT, to A$390.9 million, while Dyno Nobel Asia-Pacific saw a 45% rise to A$748.5 million.
The demerger plan has already been delayed once. In November IPL announced its decision to sell the Waggaman, La., ammonia plant ahead of the proposed demerger (GM Nov. 18, 2022), with CF Industries Holdings Inc. agreeing earlier this year to purchase the facility for $1.675 billion (GM March 24, p. 1).
IPL announced in May 2022 that it had revived plans to separate its IPF and Dyno Nobel businesses to create two separate companies, and that it was targeting to demerge its fertilizer and mining explosives divisions into two separate ASX listed companies by mid-2023 (GM May 27, 2022).
CTI analysts, as cited by a Dow Jones, reported on July 12 that IPL’s spinoff of its fertilizer business may offer “incremental valuation upside,” but noted that “there are risks given the weakness in urea and DAP pricing.” According to the report, the CTI analysts calculate IPL’s fertilizer business is worth A$1.8 billion (approximately US$1.2 billion at current exchange rates), or the equivalent of A$1.30 per share.
Nutrien Ltd. announced on July 11 that it has curtailed production at its Cory potash mine in Saskatchewan due to the loss of export capacity through Canpotex’s Neptune terminal resulting from the International Longshore and Warehouse Union (ILWU) Canada strike at the Port of Vancouver.
A tentative agreement was reportedly reached late on July 13 between the British Columbia Maritime Employers Association (BCMEA) and the ILWU, which represents roughly 7,400 dockworkers who walked off the job on July 1 (GM July 7, p. 1). The BCMEA issued a statement on July 13 saying the ports of Vancouver and Prince Rupert would reopen “as soon as possible.”
The nearly two-week strike has disrupted shipments of goods and commodities through Vancouver and Prince Rupert, Canada’s first and third busiest ports. The labor action has “potentially disrupted” C$7.5 billion ($5.7 billion) in cargo and prompted at least two vessels to divert to ports on the US west coast, the BCMEA said on July 10.
“The disruption at the Port of Vancouver has resulted in the curtailment of production at our Cory potash mine and, if prolonged, could also impact production at our other potash mines in Saskatchewan,” said Ken Seitz, Nutrien President and CEO. “We urge the parties in this dispute to come to a swift resolution to prevent further damage to the Canadian economy.”
Nutrien did not quantify the extent of the curtailment at Cory, which has a nameplate production capacity of 3 million mt/y and posted an operational capability of 2.1 million mt/y in 2022, according to the company. Cory is one of six Nutrien potash mines in Saskatchewan, with the others located at Allan, Lanigan, Patience Lake, Rocanville, and Vanscoy.
Located in North Vancouver, Neptune Terminals currently handles potash and Canadian steelmaking coal for export to international markets, and is owned by Canpotex Bulk Terminals Ltd. and Teck Coal Partnership, a subsidiary of Teck Resources Ltd. the 71-acre facility has the capacity to handle over 23.5 million mt/y of bulk products.
Nutrien said it expects full-year 2023 potash adjusted EBITDA to fall below the bottom end of its previous guidance range due to the dockworkers’ strike, a month’s long outage at Canpotex’s Portland, Ore., bulk terminal (GM May 5, p. 13), and lower global potash prices than previously anticipated. The company plans to release its second quarter results on Aug. 2, 2023.
In a show of solidarity with the Canada ILWU, Unionized US dockworkers announced on July 10 that they would not unload cargo bound for Canada, Bloomberg reported. The move by US dockworkers to refuse container ships that were rerouted from Vancouver could damage “the reliability and competitiveness of West Coast ports up and down the coast,” the BCMEA said.
Details of the tentative agreement were not made public on July 13, but the striking ILWU members were reportedly seeking an 11% wage increase in the first year, a 6% increase in the second year, a C$8,000 signing bonus, and protections against contracting out work and automation, the Globe and Mail reported. The BCMEA reported on July 8 that it had offered a revised proposal with increased benefits for casual tradespeople, increased apprenticeships, and a tool allowance.
The strike prompted demands from business and industry groups for the Canadian government to enact back-to-work legislation unless the parties reached an immediate agreement. Fertilizer Canada issued a statement on July 5 calling on the federal government to take immediate action to end the work stoppage.
Prime Minister Justin Trudeau’s government, which is being supported by a labor-friendly opposition party in a minority parliament, pushed instead for a negotiated settlement. Labor Minister Seamus O’Regan on July 11 instructed a federal mediator to draft the terms of an agreement within 24 hours. Both sides reportedly received the recommended settlement on July 12 and were then allowed an additional 24 hours to review the terms.
The strike caused container cargo shipments to plummet, with just 17 containers shipped out of the Port of Vancouver by rail on July 10, down from 1,788 the day the strike began, according to data provider RailState.
Central Florida:
Central Florida phosphate pricing was unchanged from last week. Truck-loaded DAP was posted at $470/st FOB, while MAP trucks were offered at $500/st FOB. North Florida MAP postings were set at $600/st FOB, steady from last report.
US Gulf:
NOLA DAP barges were reported trading at $435-$445/st FOB, below last week’s $445-$460/st FOB range. MAP barge prices also declined, to $460-$470/st FOB from the week-ago $465-$485/st FOB.
US Imports:
DAP imports for July-May fell 11.5%, to 873,975 st from the year-ago 987,608 st. May imports rose 339.0%, however, to 126,160 st from the prior-year 28,735 st. Imports from Saudi Arabia were noted at 508,320 st for July-May, while material shipped from Australia totaled 119,060 st. Tunisia added 74,957 st.
MAP/Other imports totaled 80,353 st for May, up 632.6% from the year-ago 10,968 st. July-May volumes were 788,123 st, rising 2.1% from 771,868 st in the prior-year period. Russian tons totaled 289,598 st in the July-May period, beating both 205,113 st from Saudi Arabia and 129,925 st from Mexico.
US Exports:
Export DAP and MAP prices firmed to $470/mt FOB on reports of limited third-quarter availability, a $35/mt increase from $435/mt FOB noted last week. The stronger US Gulf prices reflected available netbacks from recent sales reported in the Brazil inland market, sources said.
July-May DAP exports totaled 690,272 st, up 6.4% from the year-ago 648,646 st. May imports fell 8.7%, however, to 56,981 st from the prior-year 62,385 st. The US sent 174,254 st to India in the July-May period, topping both 88,969 st to Peru and 81,143 st to Uruguay. Mexico took 75,099 st.
MAP/Other exports moved up 29.0% in May, to 234,053 st from 181,424 st in May 2022. July-May exports softened 4.5%, however, to 2.06 million st from the year-ago 2.15 million st. Exports to Canada totaled 1.40 million mt st in July-May, ahead of 228,848 st to Brazil and 110,882 st to Australia.
Eastern Cornbelt:
DAP was quoted at $505-$520/st FOB in the Eastern Cornbelt, with the low confirmed at Cincinnati, reflecting another $5-$10/st drop from last week. MAP was reported at $530-$550/st FOB in the region, down $10/st from last week, with the Cincinnati market pegged at $530-$540/st FOB for new business.
Western Cornbelt:
DAP remained at $500-$530/st FOB in the Western Cornbelt, depending on location, with MAP reported in the $520-$550/st FOB range. The lower end of both ranges was confirmed in St. Louis during the week.
Northern Plains:
The St. Paul, Minn., market was quoted at the $500/st FOB level for DAP and $530-$540/st FOB for MAP in early July.
Northeast:
Phosphate prices were down in the Northeast, with the latest terminal offers reported at $540-$550/st FOB for DAP and $550-$575/st FOB for MAP.
Eastern Canada:
MAP prices in Eastern Canada slipped to C$1,010-$1,260/mt FOB, down slightly at the low end of the range. DAP was also pegged at the C$1,010/mt FOB level in Montreal, down C$28/mt from last report.
China:
Sources reported no major shifts in DAP pricing or availability. The estimated price remained in the upper-$430s/mt FOB.
India:
Buyers are looking beyond China for DAP deals, and often find them. Sources reported that Deepak closed a deal at $446/mt CFR, putting the import price at $445-$450/mt CFR, down from $455-$458/mt CFR reported in late June.
January-May DAP imports totaled 2.3 million mt, according to Trade Data Monitor, rising 9% from the year-ago 2.1 million mt. May imports were pegged at 733,000 mt, above the 218,000 mt received in May 2022. China supplied 296,000 mt for the month, while Saudi Arabia and Morocco sent 234,000 mt and 112,000 mt, respectively.
Brazil:
MAP prices came up about $5/mt, to $450-$460/mt CFR. Rondonopolis showed a larger boost, to $580-$620/mt FOB ex-warehouse. Prompt buyers are facing higher prices than longer-term buyers, sources said. Only about 10% of the market is not yet covered, however.
Brazil MAP imports firmed 7% in January-June 2023, Trade Data Monitor reported, to 2.3 million mt from the year-ago 2.2 million mt. Russia sent 1.1 million mt, followed by Morocco with 723,000 mt. Saudi Arabia sent 270,000 mt.
Second-quarter imports were reported at 1.2 million mt, off from 1.6 million mt received in April-June 2022. Brazil received 313,000 mt in June, falling 46% from 579,000 mt in the previous year. Russia topped the June market with 128,000 mt, while Morocco added 100,000 mt.
US Gulf:
Players reported NOLA TSP barge prices at $380-$385/st FOB, unchanged from the prior report.
Eastern Cornbelt:
TSP remained at $475-$480/st FOB Cincinnati for the latest offers.
Western Cornbelt:
TSP pricing was steady at $450/st FOB St. Louis in early July.
Brazil:
The TSP price widened to $345-$380/mt CFR in Brazil. Some of the downward pressure stemmed from offers of Chinese TSP for August shipment, sources said. Questions were raised whether the product would reach Brazilian ports in time for the soybean application season, contributing to the lower prices.
Traders in Rondonopolis reported a lack of available material in the area, leaving nothing to test the market. The market was last reported at $500/mt FOB ex-warehouse.
