Rentech Inc., the owner of Rentech Energy Midwest Corp. (REMC), a nitrogen fertilizer company, reported net income of $36.1 million ($.22 per diluted share) on sales of $91.4 million for the third quarter ending June 30, compared to the year-ago loss of $7.8 million ($.05 per share) on sales of $60.4 million. REMC contributes practically all of Rentech’s revenues as the company readies new energy technologies for the market.

“We are pleased to report our first profitable quarter ever,” said Dan Cohrs, Rentech executive vice president and CFO. “The cost reductions we implemented in addition to exceptional management of our fertilizer business have provided us with a foundation from which we can continue to execute on our alternative energy strategy. We believe Rentech is well-positioned to capture the opportunities that have resulted from the approval of our jet fuel for commercial aviation, as well as from the renewable power and low carbon fuel mandates in California.”

Rentech is projecting EPS for the year will be positive, and it has increased consolidated EBITDA guidance for fiscal 2009 to greater than $25 million, up from previous guidance of $15 million. In addition, REMC EBITDA guidance has been boosted to over $65 million from the previous guidance of $65 million. Factors cited for increasing guidance included significant pre-sales of fertilizer products for the remainder of the year, natural gas prices that are forecasted to remain at lower than budgeted levels, and demand for nitrogen products driven by continued strong prospects for planted corn acreage.

Rentech said higher revenues were due from higher product pricing and record shipments as favorable weather conditions allowed the realization of revenue on significant volumes shipped. Shipments during the second fiscal quarter had been delayed due to bad weather.

The average sales price per ton in the third quarter increased by 58 percent for anhydrous ammonia and decreased by 1 percent for UAN. The nine-month average sales price increased by 55 percent for ammonia and 18 percent for UAN. Prices for products delivered during the periods in fiscal 2009 were largely determined by the prices in pre-sale contracts entered into during prior periods. Rentech told analysts the average delivered price for ammonia during the nine-month period was $750/st compared to the year-ago $484/st, while the UAN price was $318/st versus $269/st. Prices in the pre-sale contracts were historically high ?Çô in part because of higher production costs, and in part because of forecasts of higher-than-normal corn planting in 2009.

Nine-month net income was $15.3 million ($.09 per share) on sales of $158.3 million, versus the year-ago loss of $54 million ($.33 per share) on sales of $136.4 million.

Germany’s K+S Group reported a 119 percent drop in group net earnings to post a loss of E44.3 million ($63.2 million; E.27 per share: $.385 per share) on sales of E738.7 million ($1.05 billion) for the second quarter ending June 30, compared to the year-ago net profit of E231.1 million ($330 million; E1.40 per share: $2.00 per share) and E1.18 billion ($1.69 billion). Operating earnings were still in the plus column at E18.1 million ($25.8 million), but were down 94.5 percent from the record amounts of E326.4 million ($465.9 million) posted in the year-ago period.

The company said demand for potash remains exceptionally weak. “Agriculture is continuing to display restraint with respect to the purchase and use of fertilizers, especially in Europe,” said Norbert Steiner, K+S chairman. “Even if there is no sign yet of normalization of demand, fundamental trends, for example, the rising global population, changes in dietary patterns in emerging market countries, as well as the increasing importance of renewable raw materials, remain intact. These facts remain in favor of fertilizer consumption to rise again over the medium to long term.”

Six-month group earnings were down 80.1 percent, to E78.2 million ($111.6 million; E.47 per share: $.67 per share) on sales of E1.81 billion ($2.59 billion), versus the year-ago E393.7 million ($562 million; E2.39 per share: $3.41 per share) and E2.4 billion ($3.42 billion). Operating earnings were off 65.2 percent, to E192.1 million ($274.1 million) from the year-ago E552.7 million ($789 million).

K+S no longer expects a normalization of fertilizer demand in second half 2009. For 2009 as a whole, it expects volumes of potash and magnesium to be 4 million mt, down from 2008’s 7 million mt. It also expects moderately declining average prices versus last year. It said the recent $460/mt CFR potash business to India sets an important point of orientation for the world markets, and might contribute to dissipating the purchasing restraint still existing on part of customers.

K+S, citing the extremely difficult and uncertain fertilizer sector, said it will stop publishing quantitative ranges for revenues and earnings for the year as a whole in its second half report. However, it does expect 2009 revenues will fall significantly versus 2008. While it expects significantly higher salt revenues, it says these will not be able to offset the negative development of revenues in the fertilizer sector.

Specialty phosphate producer Innophos Holdings Inc. reported a 70 percent drop in net income, to $17.6 million ($.81 per diluted share) on sales of $166.8 million for the second quarter ending June 30, compared to the year-ago $59.3 million ($2.74 per share) and $264 million, respectively.

Innophos CEO Randy Gress said decreased volumes reflect the continuing recession, limited reformulation, increased competitive pressure, and the inability to respond in certain instances because of the current rock cost for Mexico. “While we experienced increases in raw material costs this quarter, we were able to maintain nearly breakeven operations in Mexico under competitive pricing and lower demand conditions. Through more flexible sourcing and manufacturing, we have continued to optimize our cost positions across our system. We are continuing to run the overall business profitably despite the downside of the fertilizer market cycle and its effects upon raw material supply.”

Innophos expects its third quarter 2009 raw material cost structure on a constant volume and mix basis to be $4-$7 million higher than second quarter 2009 due to higher phosphate rock and phosphoric acid costs in Mexico and the mix of phos acid supply in the U.S. and Canada. It said about half of this increased cost will be offset by lower restructured fixed costs.

Selling prices are expected to trend down throughout the year, but cost structure for the fourth quarter 2009 is expected to remain relatively stable with the third quarter on a constant volume and mix basis.

Innophos expects the Coatzacoalcos, Mexico, complex to operate for the full year at significantly reduced levels from earlier expectations due to continued reduced fertilizer demand, increased competitive pressure (largely from China), and the inability to respond in certain instances because of the current rock cost for Mexico.

Innophos remains in arbitration with Morocco’s OCP over rock prices for 2008-2009. Innophos claims in the arbitration that OCP’s pricing actions breached the supply agreement between the parties and damaged the company. To support its duty of mitigating the claimed damage, Innophos, among other things, is buying fertilizer grade acid (MGA) to operate its Coatzacoalcos plant.

On July 17, 2009, Innophos said OCP added counterclaims asserting Innophos’s Mexican subsidiary had breached the rock exclusivity provision in the agreement by purchasing MGA for processing, breached an implied minimum purchase obligation, and improperly reduced its orders in violation of law.

Innophos told analysts that under its current contract with OCP, unless either party cancels by Sept. 9, 2009, the contract is extended for another five years beyond September 9, 2010. Innophos said its actions are still under consideration. Despite the current arbitration, the company said OCP has been a very reliable supplier for many years.

Innophos believes the more likely outcome of arbitration will be 2008-2009 rock prices below the interim prices paid for those years, and the range of any contingent liability will be between zero to $7.5 million.

In the meantime, Innophos is seeking to diversify its long-term raw material supply, with projects underway in the U.S. to debottleneck and increase production. It is also seeking to more than double the food-grade purified phos acid production at Coatzacoalcos by the first quarter 2010. In addition, Innophos continues to evaluate efforts for phos rock mineral rights in Baja, California.

Six-month net income was $47.8 million ($2.19 per share) on sales of $357.6, versus the year-ago $68.5 million ($3.19 per share) and $426.5 million.

Claims that the selective catalytic reduction (SCR) “process of choice” will emit toxic byproducts haven’t deterred Terra Industries Inc., which will be supplying the nitrogen for the diesel exhaust fluid (DEF). According to press reports, Navistar, which is suing the U.S. Environmental Protection Agency in federal appeals court, has filed a letter stating that the top researcher for the California Air Resources Board (CARB) said that the process most engine manufacturers will use to comply with 2010 federal diesel emission standards could endanger public health.

Navistar and EPA are at odds over the agency’s skipping the federal rule-making process in its approval of SCR. Navistar is the only major truck manufacturer that will not be using the nitrogen-based SCR process.

Joe Ewing, Terra vice president of investor relations and human resources, told Green Markets that California hasn’t gotten to the point of testing the proposed catalysts. “It is our understanding at Terra that CARB will be conducting tests on certain of the catalysts that are being proposed for use in the new SCR technology,” Ewing pointed out. “The tests have nothing to do with the urea-based DEF. Rather, the tests will be conducted on the metallurgy of certain of the catalysts.”

Ewing noted that it is also Terra’s understanding that not all of the catalysts being considered are affected by the tests, only certain ones. In the meantime, “EPA has not backed off implementation of the new NOx reduction standards for 2010, so the industry is gearing up for SCR implementation,” he pointed out. “Terra Environmental Technologies (TET), a division of Terra, is actively positioning to supply its TerraCair DEF in the supply chain to meet demand.”

TET represented 5 percent of Terra revenues in 2008 and grew to 8.5 percent for first half 2009. Terra expects TET margins to be at or higher than agricultural margins.

The Idaho Board of Environmental Quality has voted 5-0 to pursue new rules that would toughen state regulations of mercury emissions, reversing its rejection of a similar petition five months earlier sought by environmentalists. This time, Monsanto Corp. and the Idaho Conservation League (ICL) joined to support more stringent regulation of large mercury discharges.

Monsanto mines phosphate in Southeast Idaho’s Caribou County and processes it into elemental phosphorus near Soda Springs. Its P4 Production LLC plant in Caribou County is Idaho’s largest source of mercury, which can accumulate in fish and cause brain damage and learning disabilities in young children.

The board’s decision sets in motion the process to write new rules. Although new board-approved rules are subject to legislative approval, they go into effect unless both the Idaho House and the Idaho Senate vote them down. In past years, the ICL has led environmental groups to argue for tougher regulations on mercury.

Last February, Monsanto helped lead an effort to keep IDEQ from regulating major mercury polluters, but it decided to proactively work with the ICL and state regulators to resolve the issue. IDEQ board members then unanimously killed a rule that would have asked industries to voluntarily install best-available technology for removing mercury from smokestacks.

Monsanto Engineer Mick McCullough said his company wants to reduce overall mercury pollution, but not target levels of mercury in lakes and fish near large polluters.

The Idaho Association of Industry & Commerce, the state’s most powerful business lobby, previously has been neutral on the issue. Monsanto is now attempting to persuade other major Idaho industries to sign on. None of those companies would be affected unless they opened a new operation that discharged large volumes of mercury. The J.R. Simplot Co. is considering participation.

Some industry leaders have suggested if Monsanto wants to limit its emissions, it should make a separate deal with the state, avoiding a new regulation system. But Monsanto and the ICL say that would allow new plants to come to Idaho without regulation.

Regulations now allow a company to discharge as much as 100,000 pounds of mercury, and limit mercury inhalation by workers and plant neighbors. Monsanto’s discharges from its Soda Springs plant range from 600 to 700 pounds a year. Potlatch’s lumber plant in Northern Idaho had planned to add a new process that would have increased its mercury emissions in 2008, but backed off after the ICL opposed the change.

Meanwhile, Idaho Gov. C.L. “Butch” Otter says he will not allow the U.S. Department of Energy to store up to 17,000 tons of toxic mercury at the Idaho National Laboratory in Eastern Idaho, which would include excess federal stockpiles and commercial supplies. He expressed disappointment that he had not been told by federal officials that the 890-square-mile Idaho National Laboratory was a possible site.

Idaho is one of seven designated potential sites. Other states under consideration are Washington, Nevada, Colorado, Texas, Missouri, and South Carolina, where federal defense or nuclear sites are operated. A final site or group of sites will be named on Jan. 1, 2010. DOE is accepting public comments through Aug. 17 as part of developing an environmental impact statement.

Mercury – a dense, metallic element – has been used in gold mining and manufacturing chlorine, caustic soda, batteries, and thermometers. Its use has been in decline because of its link to health issues, including pulmonary and neural disorders. Disposal of electronic equipment poses problems because computers, televisions, and other devices contain toxic materials such as mercury, lead, and PCBs.

The U.S. still exports surplus elemental mercury, the purest form, often to developing countries with less restrictive environmental regulations. Then-U.S. Sen. Barack Obama sponsored a bill last year to ban mercury exports beginning in 2013. The bill was subsequently signed by President George W. Bush.

U.S. farmers are on track to produce the largest soybean crop in history, according to the latest Crop Production report, released Aug. 12 by USDA’s National Agricultural Statistics Service (NASS). Soybean production is forecast at a record 3.2 billion bushels, up 8 percent from last year. Yield is expected to average 41.7 bushels/acre, up 2.1 bu/a from 2008. If realized, this will be the fourth-largest soybean yield on record.

With the exception of Illinois, USDA said soybean yields will be higher or unchanged from last year across the Cornbelt and Great Plains. The largest increase in yield is expected in Ohio, up 11 bushels from 2008. Soybean area for harvest in the U.S. is forecast at 76.8 million acres, up slightly from June and up 3 percent from 2008.

Corn production is forecast at 12.8 billion bushels, up 5 percent from last year but down 2 percent from the 2007 record. Based on conditions as of Aug. 1, USDA said corn yields are expected to average 159.5 bu/a, up 5.6 bushels from last year. If realized, this will be the second highest yield on record, USDA noted.

Growers are expected to harvest 80 million acres of corn for grain, down 100,000 acres from June, but up 2 percent from last year.

USDA said forecasted corn yields are higher than last year across the central Great Plains and Western Cornbelt where mild temperatures and adequate soil moisture provided favorable growing conditions. Expected yields were also higher across much of the Ohio and Tennessee Valleys and Atlantic Coast, where beneficial moisture this year contrasted with exceptionally dry conditions last year. Yield prospects are lower in the Central Cornbelt, where excessive spring moisture delayed planting and below normal temperatures slowed corn emergence and development, USDA said.

All cotton production is forecast at 13.2 million bales, up 3 percent from last year. Yield is expected to average 816 pounds per harvested acre, up 3 pounds from last year. Producers expect to harvest 7.77 million acres of all cotton, up 3 percent from last year.

Winter wheat production is forecast at 1.54 billion bushels, up 1 percent from the July 1 forecast, but down 18 percent from 2008. Based on Aug. 1 conditions, the average U.S. winter wheat yield is forecast at 44.2 bu/a, up from last month but 3 bushels below last year. Harvest in 18 major producing states was 85 percent complete by Aug. 2, USDA said

All wheat production in the U.S. is forecast at 2.18 billion bushels, up 3 percent from the July forecast but down 13 percent from 2008.