LSB Industries Inc. said Sept. 3 that Barry Golsen has stepped down as president and CEO, effective immediately. He will remain as a director of the company. A transition of leadership has been in the works for a while, as activist shareholders have sought changes at the company.

Daniel Greenwell, lead independent director, has been named interim CEO. He has been on the LSB board since 2014 and serves as chairman of the Audit Committee and a member of the Strategic Committee.
 
The board has plans to initiate a formal search process to identify a permanent president and CEO. The board intends to retain an executive search firm to assist in the search.

Greenwell gives up his spot on the Audit Committee and as lead independent director, though he will remain on the board. Current Directors William Murdy and Richard Roedel have been elected as lead independent director and Audit Committee chairman, respectively.

Intrepid Potash Inc. reported to the U.S. Securities and Exchange Commission that on Aug. 26, it received an imminent danger order issued by the Mine Safety and Health Administration under Section 107(a) of the Federal Mine Safety and Health Act of 1977, relating to the ore hoisting shaft at the West Mine near Carlsbad, N.M.

Intrepid said the order relates to maintenance issues and salt build-up in the shaft. The order was terminated shortly after its issuance once all personnel were removed from the shaft.

Intrepid said the order does not impact the personnel and service shaft at the West Mine or the two active shafts at the connected East Mine. 

Intrepid said no injuries have occurred as a result of the cited conditions. The company said it has temporarily suspended production at the West Mine while it takes corrective actions, which are currently underway, to resolve the cited conditions.

EuroChem on Sept. 2 announced that its subsidiary Phosphorit has commenced the construction of a new high-tech ammonia plant in Kingisepp, Russia. The project is the first of some five major projects the company expects to complete in the next 10 years EuroChem (GM April 20, p. 14).

The Kingisepp ammonia plant will have a design capacity of 1 million mt/y. In addition to the ammonia production facility, the project includes utilities and offsites, such as a warehouse for liquid ammonia. All Engineering, Procurement and Construction (EPC) work is expected to be completed within 36 months.

The company plans to invest approximately €900 million (US$1 billion) in the new project.

Commenting on the news, Dmitry Strezhnev, CEO of EuroChem, said: "We are pleased to have launched the construction of our new ammonia production facility in Kingisepp, which is expected to be brought online in 2018."

"This project is part of EuroChem’s broader strategy to improve our level of self-sufficiency through greater control over our own raw materials base. The additional volumes of ammonia from the Kingisepp facility will have a direct, positive effect, on the future efficiency and reliability of our fertilizer production. This will further strengthen our business, placing us at the forefront of global fertilizer production."

Malaysia’s CCM Fertilizers will cease operations of its Shah Alam ammonium nitrate manufacturing plant, citing prolonged negative market conditions, reduced demand for AN fertilizers over the last five years and the changes in the area around the plant site. It said these factors no longer provide conditions conducive for fertilizer manufacturing.

CCM said the market outlook for the product is bearish, with major customers comprising the oil palm plantation houses trending down to cheaper fertilizers such as straights and mixtures as the downtrend in prices of Crude Palm Oil (CPO) is worsened by high CPO inventory level, low crude oil and other commodity prices.

The Shah Alam plant commenced in 1966 with a capacity of 240,000 mt. The plant experienced a loss before tax of RM4.3 million in 2014 and the business continued to face challenges in 2015.

The closure is expected to be completed by June 30, 2016, and will impact 230 jobs. The company will take a RM30 million impairment.

The company said there will be no change with respect to the availability of Cock’s Head Brand (CHB) products as manufacturing of urea-based fertilizer will continue at CCMF’s plants in Lahad Datu, Sabah and Bintulu, Sarawak, which have a joint annual capacity of 260,000 mt. The supply for AN based fertilizer will be fulfilled through outsourcing to a third-party manufacturer.

"We wish to assure our customers and suppliers that despite the closure of the Shah Alam plant, there will be no disruption of supplies in the market. There is an adequate stock of CHB products and a transition into third party manufacturing has already commenced. We will continue our trading business and serve all commitments made to our customers," said CCM Fertilizers in a statement.

The Chinese government implemented the much-anticipated value added tax of 13 percent, with a few accommodations to exporters. The new provisions took effect Sept. 1.

Fertilizer slated for export between Aug. 31, 2015 and June 30, 2016 can be taxed at either 3 percent or 13 percent. After this period, all items will be charged the higher rate.

Sources say by taking the 13 percent rate producers will be able to file refund claims on taxes paid for the input material. Once the offsets are taken, the tax on the final product will be 2.5-3 percent.

No offsets are available if the seller opts for the 3 percent rate. One source said producers with higher input costs may forgo this option and take the higher rate.

The 3 percent rate applies to material produced prior to Aug. 31 but not yet sold. Sources say this includes material for both domestic and international markets.

Exports are not exempt from the VAT, nor is there be any process for refunding the full VAT for exports. The tax office will use the date the material clears customs for calculating the tax, not the date of purchase or loading.
 
No special provisions are available for fertilizer imports. Material that did not clear customs by Aug. 31 will be slapped with a 13 percent tax. The tax will be levied against the CFR value of the product.

More clarifications are expected as the tax is implemented.
  
International traders say producers appear to be willing to absorb the increase because the offering price remains stable.

Koch Fertilizer Trading Sarl, an affiliate of Koch Fertilizer LLC, and K+S North America Corp., a fully-owned subsidiary of K+S Aktiengesellschaft, have signed an exclusive master supply agreement for potash fertilizer produced at the K+S Legacy mine in Saskatchewan.   
  
"This is an exciting opportunity for Koch Fertilizer to grow our portfolio of fertilizer products to U.S. retailers," said Scott McGinn, president of Koch Fertilizer. "We are proud to enter an agreement with K+S. This new agreement allows Koch Fertilizer to provide additional high quality products produced in North America."  
  
The C$ 4.1 billion K+S Legacy mine will reach an annual capacity of about two million tonnes of potash by the end of 2017. Koch Fertilizer Trading Sarl receives exclusive rights to supply of a projected annual volume of 500,000 short tons (~ 453,000 million metric tonnes) of granular potash for its U.S. customers.  
  
"We are seeing enormous interest in potash from our Legacy mine both from existing and new customers. Koch Fertilizer is a distinguished partner with excellent experience marketing a robust portfolio of fertilizer products. This relationship highlights our position as a reliable and independent supplier in the market," says Dr. Andreas Radmacher, Member of K+S’ Board of Executive Directors and in charge of the Potash and Magnesium Products business unit.

No further details of the agreement are available.

Ameropa is set to take the second TCP urea tender with an offer of $293.96/mt CFR, for an estimated China netback in the mid-$270s/mt FOB. The offer is about $1/mt lower than the company’s winning price in the previous tender.

The second of three tenders of 50,000 mt each drew 15 offers totaling 750,000 mt against a call for 50,000 mt. Of the 15 offers, nine were below $300/mt CFR. The highest offer – Fertisul at $308/mt CFR — also reflected a softening of prices.

While the delivered prices are showing a decline, sources note the netback to China is fairly stable in the $274-276/mt CFR range.

The third and final tender in the series of 50,000 mt each will close August 20. Sources expect to see an even softer price when that tender closes.

Canadian Fertilizer Institute (CFI) on Aug. 17 announced that it is rolling out a new brand name – Fertilizer Canada – to reflect its "evolution into a global leader for sustainable fertilizer production and use." The new name and website, fertilizercanada.ca, were launched at the association’s 70th Annual Conference in Vancouver, B.C.

"The name change after 40 years as the Canadian Fertilizer Institute is small, but reflects a major shift in the association and the industry it represents during the last decade," said Garth Whyte, president and CEO of Fertilizer Canada. "The evolution to Fertilizer Canada highlights progress the industry has made to protect the environment, enhance the economy, and benefit the social fabrics of Canadian life. Today, Canada’s fertilizer industry stands stronger than ever."

Fertilizer Canada represents Canada’s fertilizer industry – including manufacturers, wholesale distributors, and retailers – which contributes more than C$12 billion in annual sales and employs 12,000. The organization’s industry programs include the 4R Nutrient Stewardship initiative; Codes of Practice to protect the public, farmers, employees, and communities; public education initiatives with organizations like Nutrients for Life; and environmental stewardship efforts to reduce greenhouse gas and air pollutants.

"While our name is changing, our priorities remain the same: issue and policy development, knowledge and education, product stewardship, and industry services," said Whyte. "These core functions allow us to advocate for our members from a position of strength."