Hohenwald, Tenn.—The Tennessee Farmers Cooperative (TFC) opened a new location here in Lewis County in late 2011. The former Lewis Farmers Cooperative closed in 2003, according to TFC. The new location is a branch of Perry Farmers Cooperative.
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Weather, late harvest impact Itronics fertilizer
Reno—Itronics Inc. reports that full year Gold’n Gro liquid fertilizer revenue increased only 2 percent for the year ending Dec. 31, 2011, due to weather and harvest conditions. Itronics cited unusually cool, wet weather through June, while in the fourth quarter a very late harvest in the California market was followed by unusually cold dry winter weather. 2011 fertilizer revenue was $2.11 million, up from 2010’s $2.07 million, while fourth-quarter revenues were down at $238,089 from the year-ago $320,643. The company said plans are being implemented to expand sales into Hawaii and Idaho in 2012, with plans also underway to develop markets in Arizona and Washington. Fertilizer continues to represent the bulk of Itronics revenues as total revenues were $2.84 million for 2011, compared to the year-ago $2.55 million.
EPC gives update on potash drilling
Toronto—Ethiopian Potash Corp. (EPC) is now on the 20th hole of its 29 hole drilling program at the Discovery Zone, located in the Southwest Corner of the Danakil Potash Project. It expects to complete the drilling in January and be in a position to commission a new 43-101 compliant resource estimate on the Southwest Discovery Zone. Initial testing of product from six holes shows very high grade sylvite assays, according to the company, considering that these holes were located based on ready access prior to the construction of drill site access roads. Despite a slow start due to weather and access related issues, EPC says accelerated construction of access roads and drill platforms has positioned it to catch up to its peers in the basin.
USDA raises corn/soybean production estimates; bearish news fuels drop in crop/fertilizer prices
The USDA on Jan. 12 released its latest crop production estimates for 2011. While lower than 2010 production totals, the updated production and yield numbers for corn and soybeans were up from USDA’s last estimates. The bearish news for corn and soybeans fueled a drop in the fertilizer markets late in the week, according to industry sources.
NOLA urea and DAP barge prices sank on Thursday in the wake of USDA’s crop production and ending stocks updates, according to sources. One said the phosphate market was “in a panic” on Thursday, as DAP barge prices plunged to $450/st FOB after reaching $490/st FOB early in the week. USDA’s new numbers were not the only driver, however; sources also noted that NOLA phosphate barges purchased a few weeks ago at low prices had come on the market, putting pressure on prices. In the meantime, an early week rally in urea prices was also quashed by the crop news, with prices quickly retreating.
Corn for grain production was estimated at 12.4 billion bushels, up some 48 million bushels from the previous forecast, but 1 percent below 2010. The average yield in the U.S. for 2011 was estimated at 147.2 bushels/acre – up 0.5 bushel from the November forecast, but 5.6 bushels below the 2010 average yield of 152.8 bushels. Area harvested for grain was estimated at 84.0 million acres, up 45,000 acres from the November forecast, and up 3 percent from 2010.
Soybean production in 2011 totaled 3.06 billion bushels, up slightly from the November forecast, but down 8 percent from 2010. U.S soybean production in 2011 was the sixth largest crop on record, USDA reported. The average soybean yield was estimated at 41.5 bushels/acre, 0.2 bushel above the November forecast, but 2.0 bushels below last year’s average yield. Harvested soybean area in the U.S. was down 4 percent from 2010, to 73.6 million acres.
USDA faulted unfavorable planting and growing conditions for the production drop from 2010. “Depending on location, producers in the U.S. battled everything from drought and above normal temperatures to heavy rains and lowland flooding, which led to decreased production of corn, soybeans, cotton, and wheat – the first time such a year-to-year decrease has occurred in all four commodities since the 2002 crop year,” USDA noted.
All cotton production was estimated at 15.7 million 480-pound bales, down 1 percent from last month and down 13 percent from 2010. The U.S. cotton yield was estimated at 772 pounds/acre, up 1 pound from the December forecast, but down 40 pounds from last year. Harvested area for cotton, at 9.75 million acres, was down 1 percent from December and down 9 percent from last year.
USDA estimated all wheat production in 2011 at 2.00 billion bushels, down 9 percent from 2010, with the average wheat yield pegged at 43.7 bushels/acre, down 2.6 bushels from last year. Harvested area for wheat, at 45.7 million acres, was down 4 percent from the 2010 crop.
Sorghum grain production in 2011 was estimated at 214 million bushels, a significant 38 percent drop from 2010 due to the drought that hit the sorghum growing areas of the Southern Plains in 2011. The sorghum average yield was 54.6 bushels/acre, down 17.2 bushel from the previous year. Area planted for sorghum, at 5.48 million acres, was up 1 percent from the prior year, while the harvested area, at 3.93 million acres, was down 18 percent from 2010.
Rice production in 2011 was estimated 185 million cwt, down 2 percent from the previous forecast and 24 percent below 2010. Planted area for rice was estimated at 2.69 million acres, down 26 percent from 2010, while the harvested area, at 2.62 million acres, was down slightly from the previous forecast and 28 percent below the previous crop year. The average yield for all U.S. rice was estimated at 7,067 pounds/acre – down 100 pounds from the previous
CF 3Q earnings surge
CF Industries Holdings Inc. on Nov. 1 reported record third quarter 2011 net earnings attributable to common stockholders of $330.9 million, or $4.73 per diluted share, compared to $48.2 million, or $0.67 per diluted share, in the third quarter of 2010. EBITDA was a third quarter record of $640.8 million, compared to $216.0 million in the third quarter of 2010.
Net sales in the third quarter of 2011 were a record $1.4 billion, up 53 percent from $917.1 million in the same period last year due primarily to higher product prices. Total sales volume was 3.5 million tons in the third quarter of 2011, compared to 3.4 million tons in the third quarter of 2010.
"We believe CF Industries’ third quarter performance reflects the underlying strength of our business model and good execution," said Stephen Wilson, CF chairman and CEO. "We generated 45 percent gross margin and outstanding earnings during our seasonally weakest quarter. These earnings, combined with strong order volume and customer deposits for future periods, allowed us to achieve quarterly operating cash flow of $1 billion for the first time in company history."
For more details, see the Green Markets Web-edition Nov. 4.
GM Archive Linked PDFs
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Mosaic expands South Fort Meade mining
The Mosaic Co. said April 19 that it has notified the United States District Court for the Middle District of Florida that it plans to conduct uplands-only mining (i.e., non-wetlands) in an area at its South Fort Meade, Fla., phosphate rock mine in Hardee County. This uplands area is accessible from the approximately 200-acre area where the company is currently mining. Mosaic plans to begin transitioning its mining operations into these uplands over the next 30 to 60 days.
The South Fort Meade permit for mining wetlands issued by the U.S. Army Corps of Engineers is under review by the district court, as recently ordered by the U.S. Court of Appeals for the Eleventh Circuit (GM April 18, p. 1).
The company estimates approximately one-to-two years of mining potential in this uplands area. Although the uplands-only mining will be less efficient than if the company could also mine the wetlands, this transition will allow the company to continue to produce phosphate rock and keep its workforce employed while it addresses the merits of the litigation concerning the permit for mining wetlands in the extension of the company’s South Fort Meade mine into Hardee County. A ruling by the district court is expected by July 2011.
CF to pay $625,000 civil penalty, $17 M to upgrade nitric acid plants
CF Industries Holdings Inc., Deerfield, Ill., said April 19 that it has reached a global settlement on the terms of a consent decree with the U.S. Environmental Protection Agency (EPA), Oklahoma Department of Environmental Quality, Iowa Department of Natural Resources, and Mississippi Department of Environmental Quality involving compliance with the Clean Air Act (CAA).
The settlement resolves a complaint relevant to potential emissions standards deficiencies at the company’s U.S.-based nitric acid manufacturing facilities acquired through its April 2010 purchase of Terra Industries Inc. The consent decree will not be final until it has been approved by a federal court.
Under the terms of the settlement, CF will pay a civil penalty of $625,000 and undertake capital projects to achieve lower nitrous oxide emission limits at its nitric acid facilities in Iowa, Mississippi, and Oklahoma. The company estimates that the total cost of emission control and monitoring equipment will be approximately $17 million.
“We are pleased this matter has been resolved through a negotiated settlement that reflects our commitment to environmental compliance,” said Stephen Wilson, CF chairman, president, and CEO. “Stewardship is at the core of our environmental philosophy.”
The consent decree arose from an EPA information request to Terra in August 2007. The company worked with EPA to reach a settlement and develop a plan to implement emissions reduction initiatives that exceed CAA compliance standards. In doing so, the company has not admitted any violation of law or regulation.
CHS YTD wholesale fert volumes up 26 percent; company bows out of two grain joint ventures
CHS Inc. reported that wholesale crop nutrient volumes were up 26 percent for the six months ending Feb. 28, 2011. CHS cited good weather during the fall fertilizer season. Revenues were $986.5 million, up from the year-ago $620 million. CHS cited higher fertilizer prices and increased volumes. The average price reflected an increase of $87/st or 27 percent over the year-ago period.
Six month wholesale crop nutrient earnings improved $21.9 million from the year-ago period due to increased volumes and improved margins. Country operations earnings were up $38.7 million, due to higher grain volumes and increased margins, including new acquisitions.
Wholesale crop nutrient volumes were off 2 percent during the second quarter ending Feb. 28, however, revenues were up at $427.5 million from the year-ago $339 million. The increase was attributed to higher fertilizer prices, with the average sales price of all fertilizer sold reflecting an increase of $96/st or 29 percent over the year-ago period.
Earnings from the wholesale crop nutrients business improved $9 million for the three months ending Feb. 28, compared to the year-ago period, primarily due to improved margins. Its country operations earnings increased $8.6 million over the year-ago quarter, primarily due to higher grain volumes, increased retail margins, and new acquisitions.
CHS reported a 57 percent increase in crop nutrient derivative contracts for both purchase and sales agreements as of Feb. 28, 2011. Crop nutrient tons under the purchase contracts were 1.63 million st on that date versus the year-ago 1.04 million st. Sales contracts were 2.22 million st, up from 1.42 million st a year ago.
Crop nutrient inventories as of Feb. 28 were valued at $381.5 million, up from the year-ago $246.2 million.
As of March 31, 2011, CHS said it has dissolved its United Harvest joint venture which operated two grain export facilities in Washington. As a result, CHS is now operating its Kalama, Wash., export facility and its jv partner is operating the Vancouver, Wash., facility. CHS said during the next 18-24 months it will continue building upgraded infrastructure and additional capacity at Kalama. Until that construction is complete, CHS says reduced exports in that region will have a negative impact on earnings of the Ag Business unit, but it does not believe the impact will be material.
CHS also confirmed that it’s signed a definitive agreement on March 17 to sell its 45 percent stake in Multigrain S.A. to one of its joint venture partners, Mitsui & Co. Ltd. for $225 million. It expects the Ag Business unit will recognize a significant gain from this in the third quarter. Mitsui had said earlier that it had agreed to buy the unit (GM Jan. 31, 2011).
PotashCorp invests C$27 M for Saskatchewan air ambulance service
Potash Corp. of Saskatchewan Inc. has announced a multi-year, multimillion-dollar commitment to help bring helicopter air ambulance service to communities across Saskatchewan. It will help support the availability of a state-of-the-art emergency medical services helicopter and the construction of a new hangar to house the aircraft from its base of operations in Saskatoon, with estimated values of C$27 million.
“At PotashCorp, we’re committed to improving quality of life in places where we operate, and health care is an area that touches us all,” said Bill Doyle, PotashCorp president and CEO, when making the announcement April 14 to a large crowd of dignitaries and community leaders, including Saskatchewan Premier Brad Wall. “We’re a Saskatchewan company with deep roots across the province. We believe people who are critically ill or injured should have access to the best care “whether they live in one of our cities or smallest communities.”
The announcement follows the signing of a new agreement between the province and STARS “or Shock Trauma Air Rescue Society “to establish a helicopter air ambulance program in Saskatchewan and complement existing ground and fixed-wing air ambulance services.
“PotashCorp’s investment will make possible a hangar for the STARS base in Saskatoon which will initially operate with a BK117 twin-engine helicopter that has a response radius of 250 kilometers,” said Dr. Greg Powell, STARS president and CEO. “However, when the program is fully operational, PotashCorp’s commitment will help to bring a larger, faster AW139 helicopter with increased patient capacity and a wider range to support critical care missions further into northern Saskatchewan and deeper into the southern region.”
This flight range means that the new STARS program will provide service to approximately 90 percent of Saskatchewan’s population, with the capacity to respond to emergencies in rural, remote, and First Nations communities, as well as isolated work sites with limited access to health services.
“This is an extraordinary commitment to the people of our province,” said Premier Wall. “PotashCorp’s contribution means that we will be able to introduce helicopter air ambulance service to Saskatchewan as planned and move quickly to improve emergency medical service for Saskatchewan people who live and work outside of our urban centers.”