Oslo-Yara International ASA on April 18 reported strong results for first quarter 2008. Net income after minority interest was NOK 2,808 million (NOK 9.63 per share), compared with NOK 1,085 million (NOK 3.67 per share) last year. Excluding net foreign exchange gain and special items, the result was approximately NOK 8.98 per share, compared with NOK 3.59 per share in first quarter 2007. EBITDA for the quarter was NOK 3,988 million, compared with NOK 1,787 million last year. First-quarter operating income was NOK 2,860 million, compared with NOK 1,063 million last year. “Our results increased strongly in the first quarter, driven by substantial margin expansion for nitrate and NPK fertilizer. This demonstrates the value of Yara’s European position, helped by a strong European fertilizer market, and our unique position in more high-value fertilizer products like nitrates and NPKs,” said Thorleif Enger, Yara president and CEO. “The global fertilizer market has remained tight during the last year, with global production running close to full capacity. The market has been balanced by a combination of higher prices reducing demand and increased Chinese exports attracted by high prices. The recent announcement of 135 percent Chinese export tax for fertilizer will further tighten the global market.”
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Mosaic gets approval for Florida mine expansion
Bradenton, Fla.-The Manatee County, Fla., Commission voted April 14 to write a development order to allow The Mosaic Co. to mine an additional 2,050 acres – the Altman Tract – at its Four Corners Mine. According to local media reports, the commission was uncertain it could win a lawsuit of up to $400 million if it rejected the company’s request. The amount was approximately twice the annual tax revenues the county receives. Environmentalists had opposed the plan out of fear of degradation of the quantity and quality of the water flowing into the watershed of the Peace River, a major source of potable water for Southwest Florida. The approval was applauded by residents of the community of Duette, where Mosaic agreed to build a new fire station and provide other benefits for the area.
Agriliance reports net loss
St. Paul, Minn.-Agriliance LLC reported a net loss of $23.7 million on sales of $187.6 million for the second quarter ending Feb. 29, 2008, according to recent filings by one of its parents, CHS Inc. Agriliance exists as a smaller retail entity still owned by CHS and Land O’Lakes Inc., with its major crop nutrient and crop protection segments going to its parents last September. Agriliance reported a year-ago net loss of $27.4 million on sales of $497.5 million. Recent six-month net losses were $47.2 million on sales of $398.2 million, versus the year-ago loss of $58.8 million and $1.2 billion.
Late spring to impact Scotts 2Q results
Marysville, Ohio-The Scotts Miracle-Gro Co. said April 14 that it expects adjusted earnings in the second quarter, which ended March 29, to range from approximately $1.14-$1.18 per diluted share due to a late launch of the lawn and garden season. The expected results compare to adjusted earnings of $1.40 per share for the same period a year ago. The company’s outlook for the full year remains unchanged. “Consumer activity over the first two weeks of April has been strong and we are recovering ground we lost due to a later than expected break to the season in most parts of the United States,” said Jim Hagedorn, chairman and CEO. “Weather always dictates the launch of the season, and this year got off to a slower start than we’ve typically experienced. While our second quarter and first half results will be less than we had expected, the first two quarters historically represent about 25 percent of consumer purchases for the full year. We remain encouraged by initial consumer response to our new products as well as the quality of our programs and promotions, and see no reason at this time to change our outlook for the full year.” Fiscal 2008 reported results will include $15-$20 million in unexpected costs due to a voluntary retail recall of wild bird food. A significant portion of this cost will be included in the second quarter results. The company will account for costs associated with the recall on the line “restructuring and other one-time charges.” As a result, ScottsMiracle-Gro will exclude these costs when discussing its expected results for the full year. ScottsMiracle-Gro will report its complete second quarter results on April 29, 2008, prior to the opening of the U.S. financial markets.
Yara board proposes new buy-back program
Oslo-Yara International ASA said April 14 that it will ask shareholders at its May 8 annual meeting to approve a new share buy-back program. Yara’s board proposes that the existing buy-back program be replaced by a new program, authorizing the board to acquire up to 5 percent of Yara’s shares within the next 12 months. Shares may be purchased within a price range of NOK 10 to NOK 1,000. The shares may either be used for cancellation or as payment in business transactions. The company will enter into a new agreement with the Norwegian State to the effect that the state’s shares will be redeemed on a pro-rata basis so that the state’s ownership is unchanged in the event of a cancellation of the shares bought back.
DOT posts hearing schedule on tank car changes
Washington, D.C.-The Department of Transportation Pipeline and Hazardous Materials Safety Administration (PHMSA) has announced a public hearing schedule regarding its proposed changes to railroad tank car standards for the transportation of poison inhalation hazard (PIH) commodities such as anhydrous ammonia and chlorine. On April 1 PHMSA, in consultation with the Federal Railroad Administration, published a notice of proposed rulemaking (NPRM) about the standards (GM April 7, p. 14), detailing proposed tank car design enhancements for head and shell impacts; operational restrictions for trains hauling tank cars containing PIH materials; interim operational restrictions for trains hauling tank cars containing PIH materials, but not meeting the enhanced performance standards; and an allowance to increase the gross weight of tank cars that meet the enhanced tank-head and shell puncture-resistance requirements. The public hearings, announced in the Federal Register and flagged by the Green Markets FR Today alert service, will be held in Washington, D.C., at the Washington Plaza Hotel on May 14, 15, 28, and 29. The May 14 meetings will focus on the NPRM as it relates to the tank car transportation of chlorine and the May 15 meeting will focus on anhydrous ammonia, the two chemicals that PHMSA says constitutes 80 percent of the total rail tank car PIH shipments each year. The May 28 meeting will focus on PIH materials other than chlorine and anhydrous, and will also address railroad-specific issues related to the NPRM, such as the operational restrictions proposed, role of the Tank Car Committee, the impact of heavier tank cars on railroad infrastructure, etc. The final meeting on May 29 is intended to provide an opportunity for all interested parties to present general comments related to the NPRM and/or any relevant concluding remarks. Parties who cannot attend the meetings can submit written comments at http://www.regulations.gov; by fax at 202-493-2251; or by mail or hand delivery at Docket Operations Facility, U.S. Department of Transportation, 1200 New Jersey Avenue, SE., W12-140, Washington, DC 20590. For more information, contact Lucinda Henriksen, Office of Chief Counsel, Federal Railroad Administration (Lucinda.Henriksen@dot.gov or 202-493-1345); or Bill Schoonover, Office of Safety Assurance and Compliance, Federal Railroad Administration (William.Schoonover@dot.gov or 202-493-6229).
Actagro to locate plant in Arkansas
Osceola, Ark.-Actagro LLC, a Biola, Calif.-based manufacturer and marketer of organic acid-based products designed to work with other plant nutrients, has disclosed plans to move into a vacated industrial building in the Osceola area, according to Chamber of Commerce Executive Director Eric Golde. The local press reported that Actagro owner Carl Ueland of Actagro, LLC said April 11 that he plans to hire 15 people initially, but local development boosters believe the company has the potential to grow into a significant industry. Ueland said the plant would open in six months to a year, adding that the Mississippi County site was chosen because sales are on the rise. The plant will be located in a building that formerly housed a furniture maker. According to the Actagro website, the company’s products are designed to compliment conventional plant nutrition and meet the needs of growers and dealers throughout the western United States. Actagro LLC began operations in September 1997 when it acquired the assets of Actagro Inc., which was founded as Pacific Micro Minerals in 1980. The plant and operations headquarters are situated on 11 acres in Biola just west of Fresno. Its blending facility can produce over 50,000 gallons of N-P-K blends per day.
Potash One sells some permits
Vancouver-Potash One Inc. said April 11 that it has agreed to sell the two permit applications it recently acquired to 0821474 B.C. LTD., a private British Columbia company, at arms length to the company. The permit applications were part of a package of three permits and two permit applications acquired by the company. The two permit applications to be sold are KP416 and KP417, which, although in the vicinity of existing or planned potash operations, are not contiguous with the Legacy Project and are not considered amenable to solution mining, the company’s preferred potash mining method. The purchase price payable by the arms-length purchaser consists of $3,097,880 in cash, of which $500,000 has been paid as a non-refundable deposit, with the balance to be paid upon issue of the permits. The company understands that the purchaser intends to either use the permits as the basis for an initial public offering, or to sell the permits to a capital pool company or other public company. The purchaser has agreed to ensure that in connection with any such event, the company will have the right to acquire up to a 13 percent interest in the public company on a post financing basis, nominate one member of the board of the public company, and purchase up to 20 percent of the securities sold in certain future financings conducted by the public company. “We are very pleased to have entered into this agreement as this provides the company an immediate financial benefit and a right to retain a significant interest in the potential development of a conventional potash mine from these two strategically located permit applications,” said Paul Matysek, Potash One president and CEO. Potash One holds an option to acquire 100 percent interest in a 97,240 acre potash subsurface exploration permit (the Legacy Project), and owns 100 percent of three other potash subsurface exploration permits covering 239,000 acres that are contiguous to the Legacy Project in Saskatchewan.
Legend reveals phosphate scoping results
Melbourne, Australia-Legend International Holdings Inc., a Delaware Corp. with phosphate holdings in the State of Queensland, Australia, has released the results of the phosphate rock preliminary scoping study on its phosphate projects in Queensland. The study reported that annual gross earnings could come in at $701.7 million-$1.7 billion, should the price of phosphate rock range between $300-$400/mt. Annual revenues would span from $1-$2 billion, respectively. Legend has historically defined phosphate deposits of 1,463 million mt at 16 percent P2O5 on its Queensland holdings. The scoping study is based on a 10 million mt/y phosphate rock mine site; a beneficiation plant generating 5 million mt/y phosphate rock concentrate; a 300 kilometer slurry pipeline from Lady Annie to the Port of Karumba; the development of a drying facility, plus loading and berthing areas at the Port of Karumba; and barge transfers from shallow draught barges out to larger vessels moored off the coast in the Karumba Roadstead waters ready to ship product to Asia. A copy of the study can be found atwww.lgdi.net. Legend will be commencing the revalidation of historical deposit estimates by drilling a number of twin holes across representative samples throughout the deposit zone, revalidating the metallurgical testwork by sending bench and pilot plant scale samples to an independent external engineering company to develop a flow sheet and final plant design, and conducting a full technical feasibility study and environmental impact statement. Legend’s exploration licenses include approximately 5.2 million acres in Queensland and the Northern Territory, Australia.
Chinese company invests in Spur
Vancouver-Spur Ventures Inc. reports that the company has signed a memorandum of understanding with Zhong Chuan International Mining Co. Ltd. to complete an equity private placement and to pursue strategic investments in China and elsewhere in Spur’s fertilizer business. Zhong Chuan, a private company, was founded by its current chairman, Mr. Sun Xinming, in 1992. It has 18 domestic and overseas direct subsidiaries dedicated to prospecting and developing precious, nonferrous, and ferrous metals and energy resources, with a focus on gold and coal. This partnership with Spur is its first strategic investment in the booming Chinese fertilizer and agricultural sector. “It is clear to us that Spur must align itself with an influential and experienced Chinese company to ensure our success in China” Steven Dean, Spur’s chairman, said at the signing ceremony in Beijing. “Zhong Chuan’s initial investment in Spur will be a signal of its confidence in Spur and in Spur’s future in the fertilizer business in China,” said Dean. “Zhong Chuan has considerable experience and success in developing mines in China and will work with Spur to advance Spur’s interests in China,” Dr. Rob Rennie, Spur’s president & CEO, stated. “Our primary focus will be to ensure that Spur’s Sino-Canadian joint venture, Yichang Maple Leaf Chemicals (YMC) can start its two mines as soon as possible.” Zhong Chuan will initially invest $ 11.34 million to acquire eighteen 18 million units of Spur at $0.63 per unit in a private placement that is expected to make Zhong Chuan Spur’s largest investor. Each unit will consist of one common share, plus one-half of a warrant and one-half of a special warrant. Each full warrant is exercisable to purchase an additional common share at an exercise price of $0.90/share until May 31, 2010; each full special warrant is exchangeable for an additional common share for an aggregate of 9,000,000 common shares at no additional cost to Zhong Chuan, subject to certain conditions. In particular, the 9,000,000 special warrants are immediately exchangeable for 9,000,000 common shares, at no additional cost to Zhong Chuan, on the completion of the formal transfer of the mining licenses for the Shukongping mine and Dianziping mines to Spur’s majority controlled Chinese joint venture, Yichang Maple Leaf Chemicals Ltd., on or before April 14, 2009. Additional contingencies can be seen atwww.spur-ventures.com. Spur says Zhong Chuan’s investment significantly increases Spur’s working capital position and strengthens its balance sheet. As a result of this investment in Spur, Mr. Sun Xinming, chairman of Zhong Chuan and a Chinese citizen, and Mr. Charles Yan, a director of Zhong Chuan and a Canadian citizen, have been invited to join the Spur board. Spur aims to be the premier integrated fertilizer manufacturer in China, with plans to produce up to one million mt/y of high-quality compound phosphate fertilizer for domestic consumption in the central province of Hubei, China. These expansion plans include the development of the largest phosphate deposit in China, located near Yichang City. Zhong Chuan will initially own 23.4 percent of Spur, and could own up to 37.5 percent if all the warrants are issued.