The Tampa ammonia price for October closed at $435/mt CFR, reflecting a $10/mt drop from the September price. Sources cited temporary oversupply in the New Orleans area, with stagnant demand as the industry awaits the fall application season. In addition, inventories are also reported to be plentiful in Trinidad, Venezuela and Tampa.

The Mosaic Co. said late Sept. 21 that in response to current crop nutrient market conditions, primarily related to delayed fertilizer purchases in Brazil and North America, it will reduce production in its Potash business by extending maintenance downtime at its Colonsay mine, and maintain planned slower production in its Phosphates business.

Since the company announced its third quarter guidance on Aug. 4, 2015, domestic and international crop nutrient markets have softened. Currency volatility, lower grain and oilseed prices, political and economic uncertainty, as well as global equity market declines have adversely impacted market sentiment.

"The long-term positive outlook for crop nutrient demand has not changed, but the industry faces some near-term challenges in the current environment. In these times, we will continue to be diligent in looking for opportunities to create shareholder value. It is a time for leadership, and we are managing our production levels to match current demand, controlling our costs, and maintaining our discipline," said Joc O’Rourke, president and CEO. 

In light of current market sentiment, volumes are lower than expected, and prices have weakened.  Mosaic’s reduced production is expected to impact per unit costs and segment margins. As a result, the company has provided the following updates to third quarter guidance:

Phosphate volumes are expected to be at the low end of the previously communicated range of 2.1 to 2.4 million mt. The average DAP selling price is expected to be in the upper half of our previously provided range of $435 to $455 per mt. The Phosphates segment margin rate is expected to be in the low-twenty percent range as previously guided.

Potash volumes are expected to be in the bottom half of the previously communicated range of 1.6 to 2.0 million mt. The MOP average selling price is expected to be in the bottom half of the previously announced range of $260 to $280 per mt. As a result of these developments and lower operating rates, the Potash segment gross margin rate is now expected to be in the high teens, compared to prior guidance of the low- twenty percent range.

International distribution volumes and gross margins remain unchanged, and are expected to be close to the midpoint of previous guidance. Volumes are estimated to be in the range of 1.9 to 2.2 million mt and gross margins to be in the range of $20 to $26 per mt.

Sociedad Química y Minera de Chile SA (SQM) reported Sept. 17 that the earthquake that occurred Sept. 16 in central Chile did not damage SQM production facilities, which continue to operate normally. SQM said there were no accidents or injuries involving its workers that live in the areas affected by the earthquake; however, SQM is providing support to those workers who require it.

Intrepid Potash Inc. reports that on Sept. 10, with the approval of the Mine Safety and Health Administration, it resumed production at the West Mine near Carlsbad, N.M. As previously disclosed, on Aug. 26, 2015, Intrepid temporarily suspended production at the West Mine while it took corrective actions to resolve maintenance issues and salt build-up in the ore hoisting shaft at the mine.
 
Primarily as a result of the production outage at the West Mine, Intrepid has updated its second-half and full-year 2015 outlook. It has lowered its potash production ranges by approximately 45,000 st from estimates given in July. Second-half has gone from 440-460,000 st to 395-415,000 st while full-year went from 830-850,000 st to 785-805,000 st.

Second-half Trio production went from 75-90,000 st to 65-80,000 st with full-year from 155-170,000 st to 145-160,000 st.

Intrepid said it expects abnormal production costs for second-half 2015 of between $6-$8 million relating to the production outage at the West Mine, including incremental costs related to maintenance work in the ore hoisting shaft, some of which will continue into the fourth quarter.  

Intrepid also updated the potash and Trio® sales volume outlooks to reflect current demand across the fertilizer sector, which has been slow to develop for the fall season.

Second-half potash sales went from 415-445,000 st to 300-345,000 st with full-year going from 790-820,000 st to 675-720,000 st. Second-half and full-year total cash costs for potash remained the same as earlier guidance at $275-$290/st and $285-$300/st, respectively.

Second-half Trio sales estimates dropped from 80-95,000 st to 55-70,000 st; full-year went from 175-190,000 st to 150-165,000 st. Second-half total cash operating costs went from $260-$275/st to $290-$305/st; full-year from $255-$270/st to $265-$280/st.

Yara International ASA has made a preliminary decision to halt development of its Sokli mining project in Finland, due to the anticipated profitability of the project being below Yara’s requirement.

Before concluding, Yara will seek to finalize the process of obtaining environmental and mining permits and clarify other prerequisites for project execution. Yara may also re-evaluate the project in the future.

The book value of Yara’s Sokli investment is EUR 18.5 million.

Yara International ASA has signed a non-binding Heads of Terms with U.S.-based Praxair Inc. to sell its European CO2 business for EUR 218 million. The agreement also includes a sale of Yara’s remaining 34 percent stake in the Yara Praxair Holding AS joint venture to Praxair for an estimated EUR 94 million.

"The CO2 business has been an attractive and long-standing part of Yara’s portfolio, but remains a relatively small part of the broader industrial gas industry, and where Praxair is well positioned to create additional value. I am confident that this business will be further strengthened under Praxair’s ownership, and at the same time this agreement allows Yara to re-deploy management and financial capacity to other value-creating opportunities" said Svein Tore Holsether, president and Chief Executive Officer of Yara International ASA.

The proposed transaction is conditional upon final transaction agreements, obtaining necessary approvals from competition authorities, and other customary closing conditions. The transaction is expected to close in the first quarter of 2016, with a provisionally estimated post-tax gain of EUR 150 million including the Yara Praxair Holding AS sale.

In 2014, Yara’s European CO2 business sold more than 850 thousand metric tons of liquid CO2 and 50 thousand metric tons of dry ice, delivering an EBITDA of EUR 21.5 million and revenues of EUR 112 million primarily from the food and beverage industry. The business operates 5 CO2 liquefaction plants, 3 CO2 ships, 7 ship terminals and 6 dry ice production facilities.

The Yara Praxair Holding AS joint venture, operating in Scandinavia and formed in 2007, had a 2014 EBITDA of EUR 35 million and revenues of EUR 145 million (100% basis). Yara’s exit from the joint venture is regulated through a put/call option in the joint venture agreement.

The Heads of Terms also includes an agreement for Yara to supply Praxair with raw CO2, gas and continue to operate three of the CO2 liquefaction units which are integrated within Yara’s fertilizer plants.

State-owned Moroccan phosphate producer OCP SA is studying bringing in investors such as sovereign wealth funds as a prelude to an initial public offering within two to three years, according to Bloomberg, citing individuals familiar with the plan.
    
OCP CEO Mostafa Terrab said in an interview Sept. 15 in London that the state-owned company is ready to consider all possibilities and a share offering isn’t "taboo", although the government has the final say. He said the Moroccan state will always maintain majority control. "Other than that, we are open to all financing options that advance our strategy and protect our shareholders’ interest."
    
OCP, founded in 1920, is owned 95 percent by the government with the remainder held by local lender Banque Centrale Populaire, is in the middle of a $20 billion-plus expansion program to double mining output and triple fertilizer production. It has spent $4 billion on the 2008-2025 plan so far and is now deploying $2 billion more. The balance will be invested as demand increases, Terrab said.

K+S Group confirmed reports that German prosecutors for the state of Thuringia searched company offices Sept. 9-10. K+S said it is fully cooperating with authorities. The matter revolves around complaints about K+S wastewater being disposed into the Werra River. K+S maintains it had approval from authorities for the disposal.

The Andersons Inc. on Sept. 9 announced that Pat Bowe, formerly Corporate Vice President of Cargill Inc., will succeed Mike Anderson as President and CEO, effective Nov. 2, 2015. Anderson will remain as the company’s Chairman of the Board. Bowe will also join the board.

LSB Industries Inc. today gave an update on the operational performance of its Pryor, Okla., nitrogen facility and a continued outage at the facility.

Pryor underwent its annual planned turnaround to address routine maintenance issues on July 11, 2015 and concluded the turnaround on Aug. 4, 2015. While in the process of restarting the ammonia plant, Pryor’s automated monitoring systems detected several mechanical issues that prompted management to take the plant out of service. Certain components were removed from the facility, taken off-site for repair and were reinstalled, and the plant restarted on Aug. 21, 2015.

Subsequent to the restart of the ammonia plant on Aug. 21, 2015, Pryor was in production for four days. However, on Aug. 25, 2015 a pipe connecting two primary components of the ammonia plant developed a crack, causing operations at Pryor to once again be suspended. LSB said there were no injuries or environmental impact as a result of the crack, and it appears that the damage is isolated to this one pipe. After inspection by a third party, it has been determined that the pipe repairs should be completed by Sept. 18, 2015.

LSB estimates that the periods of downtime at Pryor in August and September, assuming the ammonia plant is operational by Sept. 18, 2015, will reduce third quarter 2015 sales volumes of UAN and ammonia by a total of approximately 35,000 to 40,000 tons and 5,000 to 6,000 tons, respectively, while lowering operating income by a total of approximately $8.0 million to $8.5 million, which includes lost profit, unabsorbed overhead expenses and costs of repair. Each additional day of downtime at Pryor, beyond Sept. 18, 2015, is estimated to result in a reduction of operating income of approximately $150,000 to $200,000.