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Chemtrade suffers second major incident at Beaumont in two years

A fire occurred at Toronto-based Chemtrade Logistics Income Fund’s Beaumont, Texas, plant at approximately 2:30 a.m. May 15 when the plant was being restarted after a weather-related power outage. The log entry provided by the Beaumont Fire Department confirmed that there was a “response to a large refinery structure on fire (where) we were informed upon arrival that the unit on fire separated sulfur dioxide which involved fire control or extinguishment, HazMat detection and monitoring and sampling.” Lack of water pressure apparently was a hindrance, and foam was deployed to cool any remaining hot spots. There were no injuries and no off-site environmental releases.

Chemtrade said the plant is now secure and remains safely shut down. A Chemtrade investigation team is assembling to examine the details of the incident. The cause of the fire is not yet known, and the plant will remain shut down until it is determined that it can be safely restarted. The extent of down time is also not known, although there appears to be extensive damage to a newly installed piece of equipment.

In August 2008 an explosion occurred in the furnace at the plant, causing injuries to two employees (GM Aug. 25, 2008). It took until January 2009 for repairs to be made and for the plant to return to production (GM Jan. 12, 2009).

ICL 1Q fert income up 67 percent; company to pay $668 M in dividends in June

ICL Fertilizers, the fertilizer unit of Israel Chemicals Ltd. (ICL), reported operating income of $232 million for the first quarter ending March 31, 2010, up 67 percent from the year-ago $138.8 million. ICL said this reflected an increase in quantities sold, countered by a decline in some selling prices, together with the strengthening of the shekel compared with the dollar.

Fertilizer sales were up 106 percent, to $766 million, compared to the year-ago $371.1 million. During the quarter, ICL sold 1.33 million mt of potash, an increase of more than 300 percent from the year-ago quarter. During January 2010, ICL signed contracts with several customers in China for a total of 620,000 mt of potash, including an option, in 2010. In addition, in March 2010, it signed contracts with Indian customers for a record total of 1.43 million mt of potash, including options, for the year beginning April 2010.

Company-wide, ICL said it was the company’s second-best-ever first quarter, bested only by the first quarter of 2008, which was a “spike” year for the industry. Net income was up 52 percent, to $241 million, compared to the year-ago $159 million. Operating income was $303 million, up from the year-ago $206 million. EBITDA moved up to $353.1 million from $259.3 million. Sales were up 54 percent, to $1.38 billion from the year-ago $898 million. All segments saw improved sales.

In addition, ICL announced that its board has decided to distribute a one-time dividend of $500 million, which it says will create a desirable debt-to-equity ratio and an appropriate return to shareholders. ICL came to this decision after analyzing its continuous improvement in its financial position, operational scope, profitability, cash flow, and ongoing reduction in debt.

The board is also re-establishing its policy of distributing a quarterly dividend of up to 70 percent of its net income. In line with this decision, it has approved the distribution of a dividend totaling $168 million for the first quarter. The total $668 million in dividends will be paid June 28, 2010.

ICL paid dividends of $155 million on April 27, 2010, for the fourth quarter 2009, bringing total 2009 dividends to $530 million.

SQM 1Q income off, sales up

Sociedad Quimica y Minera Chile S.A. (SQM) reported a 13.5 percent drop in net income and a 21 percent increase in sales for the first quarter ending March 31, 2010. Net income was $76.5 million ($.29 per ADR share) on sales of $388.5 million, compared to the year-ago $88.4 million ($.34 per ADR share) on sales of $321.1 million.

“After undergoing unprecedented economic challenges during 2009, which negatively impacted global markets, the first quarter of 2010 showed strong signs of a transition to pre-crisis levels,” said Patricio Contesse, SQM CEO. “We observed positive signs of recovery in all of our business lines, with higher volumes in each business segment in the first quarter of the year compared to first quarter of 2009. Although prices in our fertilizer and lithium businesses are lower than the same period last year, they are in line with our expectations for 1Q10. Although there continues to be economic uncertainty in global markets, improved economic conditions and a more encouraging outlook in general have had a positive impact on our businesses, and we expect this positive trend to continue throughout the year.

“Last year’s challenging conditions proved that our diverse businesses and broad customer base make SQM more resilient compared to fertilizer industry players under demanding market conditions,” added Contesse. “Sales volumes for the first quarter of 2010 reflect the turnaround in markets, and we are optimistic that the following quarters will continue to show promising signs of growth and recovery for our businesses.”

All SQM business units saw increased sales during the quarter. Specialty Plant Nutrient’s (SPN) sales moved up 6.2 percent, to $128.2 million from the year-ago $120.7 million. SQM said SPN demand has begun to recover, particularly for soluble potassium nitrate fertilizers. With newly established prices in the potash market, SQM said growers are making plans to purchase and apply fertilizer in all sectors. While average SPN prices were considerably lower versus the year-ago quarter, SQM said current prices are 5-10 percent lower than those for second half 2009. SQM expects current prices to remain stable. SPN volumes increased 35 percent from year-ago levels. SQM expects volumes to improve throughout the year with 2010 volumes significantly higher than 2009.

Potassium chloride and potassium sulfate revenues for the first quarter were $124.7 million, up 30.2 percent from the year-ago $95.7 million. SQM said it was able to double its potash sales during the quarter versus the year-ago period. Average prices fell approximately 41 percent from the year-ago quarter. The company expects current price levels to hold. As with SPN, SQM thinks these products are now getting back to normal usage. SQM said expansion plans have moved forward and it expects this year’s production to be higher than 2009, allowing it to reach a sales target of 1.2 million mt of MOP and SOP for the year.

New Mosaic Florida office unites staff

Tampa-A new, energy-efficient office building recently constructed for The Mosaic Co. near Tampa, Fla., centralized many of its employees in Florida at a single location for the first time since the company was formed, according to David Townsend, Mosaic spokesman. The 113,000 square-foot building was built according to Gold LEED standards for energy efficiency, and makes use of direct natural light, water conservation, and thermal comfort. It was constructed by Ryan Companies U.S. using low volatile organic compounds (VOC) and recycled construction materials. Townsend said it was located in the “emerging town center of Fishhawk Ranch” area of Hillsborough County. “This brings 400 employees together from different locations in Hillsborough and Polk counties under one roof,” Townsend said. “It improves team building by bringing administrative personnel together with the supply chain group.” He added an application for LEED certification had been submitted.

Uralkali stake up for sale

Moscow-Potash giant Uralkali on May 27 confirmed that majority owner Madura Holding Ltd. is in preliminary discussions with a number of interested third parties regarding a possible sale of shares in the company. Uralkali said as far as it is aware, the discussions are at an early stage and there is no certainty about the terms and structure of such a transaction, or that an agreement will be reached. Major media outlets had reported that billionaire Dmitry Rybolovlev is shopping around his majority stake in Uralkali to fellow billionaires.

Suits are numerous over tank collapse

Chesapeake, Va.-The principals are reluctant to provide any details about Allied Terminals’ $3 million lawsuit against the companies that did the welding repairs and upgrades and inspected the work on a storage tank that collapsed in late 2008, injuring two persons and inundating a nearby neighborhood with 2.1 million gallons of liquid fertilizer. Allied Terminals, joined by ACE American Insurance Co., has filed a 10-count lawsuit in circuit court against G&T Fabricators of Wilmington, N.C., and HMT Inc. of Texas, seeking to recoup the costs of lost fertilizer, property damage and clean-up, and interruptions to Allied’s business. A spokesman for the legal firm representing Allied, Vandeventer Black LLC, emailed, “At this time we have no comment or information regarding the case.” Calls to Allied official Bruce Law at the Chesapeake office were not returned. According to press reports, the suit seeks more than basic damages by asking that the defendants be required to cover or contribute to claims amounting in the millions of dollars filed against Allied and others over the spill. The lawsuits by two injured parties cite findings by the U.S. Chemical Safety and Hazard Investigation Board that the tank wasn’t inspected properly after the repairs were performed.

Worker’s death believed nitrogen-caused

Middletown, Ohio-The death of a Middletown maintenance worker, presumably from nitrogen leaks in gas lines, remains under investigation by officials with the city and the two companies involved. The tests by Middletown officials identified the source of the nitrogen leaks in lines running from Air Products & Chemicals to AK Steel’s Middletown works. Air Products spokesman Art George said the 250-foot lines are being excavated to find the leaks. Middleton firefighters tried to rescue the worker, identified as Jabin Lakes, who was doing a routine inspection of a sewer line when he died May 7. The Middleton Fire Department declined to answer questions, referring calls to City Attorney Les Landen, who did not respond to email inquiries. There also was no response from AK Steel at Middleton. Details on the kind of nitrogen involved were not available.

Perfect Blend gets $22,500 air quality fine

Spokane, Wash.-One of Washington state’s organic fertilizer producers has been fined $22,500 by the state for exceeding particulate matter and ammonia emissions limits, along with other air quality violations. Perfect Blend Organics, which claims to be a world leader in the research and development of organic soil fertility, processes chicken manure into organic soil fertilizer at its facility about 14 miles east of Othello. According to the Washington Department of Ecology, Perfect Blend failed to submit a complete air quality permit application by Dec. 15, 2008, and still does not have a completed application for a permit. In addition, tests conducted Sept. 16 and 17, 2009, showed the facility exceeded emissions limits. The company has 30 days to appeal the fine to the state’s pollution control hearings board in Olympia. Perfect Blend Organics touts a process “for the next generation of soil fertility products known as biotic fertility.” Its 4-4-2 All Purpose Biotic Plant Food and 8-4-2 Biotic Plant Food are carried by Lowe’s for turf and landscape use, organic producers, and personal gardening.

Deere upgrades ag/turf sale projections

Moline, Ill.-Deere & Co. recently told analysts that it has had to increase its guidance for agricultural equipment sales in the U.S. and Canada, which are now forecasted to be up 5-10 percent for 2010. “That’s quite a change from our February forecast of comparable to 2009 and our November 2009 forecast of down about 10 percent,” said Susan Karlix, manager, investor communications. “We continue to see our order books strengthen, especially for large ag equipment. She said conditions in Western Europe still remain weak and sales are expected to be down 10-15 percent, while South America is another bright spot, with a 25 percent projected increase. Deere also expects to see a 5-10 percent increase in small utility tractors and turf equipment in the U.S. and Canada. Deere sales worldwide for ag and turf are expected to be up 9-11 percent over previous forecasts of 4-6 percent. For the second quarter ending April 30, 2010, Deere reported net income attributable to Deere & Co. of $547.5 million ($1.28 per share), up from the year-ago $472.3 million ($1.11 per share). Income would have been $677 million in the second quarter except for a $129.5 million charge due to the enactment of new health care legislation in the U.S.

Virginia plant completes Ostara installation

Suffolk, Va.-The Hampton Roads Sanitation District and Ostara Nutrient Recovery Technologies Inc. have completed installation of the second fully operational recovery facility – and the first along the Chesapeake Bay watershed – that extracts phosphorus and other nutrients from wastewater treatment systems and turns them into a high quality fertilizer. Unveiling of what is officially called the Struvite Recovery Facility took place May 27 at HRSD’s Nansemond treatment plant here, featuring environmentalist and attorney Robert F. Kennedy Jr., who is an Ostara board member. Developed by Ostara, this nutrient recovery technology, trademarked “Pearl,” enhances operational efficiency while producing a beneficial fertilizer product. HRSD will offset the cost by producing Crystal Green fertilizer, which will be marketed by Ostara. Ostara describes Crystal Green as a slow-release formula that ensures that nutrients are absorbed by plants, reducing fertilizer runoff and pollution of the Bay’s fragile ecosystem. The Ostara process has been operating at a commercial scale since May 2009 at the Clean Water Services’ Durham advanced wastewater treatment facility in Tigard, Ore., and is currently being pilot-tested at several wastewater treatment facilities in North America and Europe.