Shoreview, Minn. — WinField, one of the nation’s largest distributors of professional products for turf, ornamental, pest control, aquatics, and vegetation management, announced May 15 that it has completed the acquisition of the assets of Minnesota-based Precision Turf & Chemical. WinField said the combination will give customers in the Upper Midwest access to a broader range of products and services. WinField, a unit of Land O’Lakes Inc., has 80 service centers across the country and close to 100 sales representatives.
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Scotts relaxed over forward urea prices
Marysville, Ohio — Scotts Miracle-Gro Co. is not concerned about the recent spike in urea prices, saying it is well-hedged for the remainder of the current fiscal year and that it expects prices to ease going forward. Scotts recently told analysts it is 88 percent hedged on urea for the rest of the fiscal year. “When we look at the forward markets, we don’t see the current market as being indicative of the forward markets for when we’re going to be back in the market purchasing urea for next fiscal year,” said David Evans, Scotts CFO and executive vice president, strategy and business development. “So at this stage, we are not seeing urea as a material concern for next year.” Company Chairman and CEO Jim Hagedorn added that the company has started to commit to the future urea market, and that it is pretty relaxed about the kind of prices it has been seeing. Scotts did not raise its own product prices this year, even though it incurred higher input costs. However, it is anticipating lower single digit increases next fiscal year. While Scotts earnings were off for the quarter ending March 31, 2012, (GM May 14, p. 12), sales were up, with the company saying as it entered May consumers purchased 1 million more bags of fertilizer than they had the same time last year. Scotts said consumers are buying 2.7 bags of fertilizer every time they buy the company’s new Snap fertilizer spreader. In addition, the company said Miracle-Gro has gained a substantial Facebook presence as it has high profile visibility on the Farmville game website. As a result, the product now has 1.1 million Facebook friends, versus about 5,000 two months ago.
Driver charged after sulfuric acid spill in Florida
Bartow, Fla. — The driver of the truck that spilled acid at an intersection on April 24 has been charged by the Polk County Florida Sheriff’s Department for not properly securing his load. Eric Scott Garland, who received second-degree burns after he slipped while attempting to warn motorists of the hazard, was ticketed on May 2 following an investigation. The spill occurred as he was attempting to stop at an intersection at South Rifle Range Road and State Road 60. The truck was carrying six tanks of sulfuric acid, rock salt, and peroxide, which combined to form a harmful gas cloud, but dispersed quickly due to high winds at the time of the spill. Investigators said he did not have a barricade, which would have prevented the load from shifting, although it was secured with two-inch-straps. A three-mile section of the road was closed for most of the day following the spill and cleanup. Garland was working for Davis Supply Inc. of Fort Myers, Fla. at the time of the incident.
Ammonia leak under investigation
Boardman, Ore. — ConAgra officials, along with emergency responders, were saying only that the source of an anhydrous ammonia leak that shut down the Lamb Weston facility here around 9:30 p.m. May 15 is still under investigation, and that those employees who were affected were treated and released from a nearby hospital. No one was available at the facility, but ConAgra corporate spokesman Jeff Mochal reported that seven employees were evaluated at Good Shepherd Hospital at Hermiston for several hours for respiratory distress and nausea and then released. The Murrow County sheriff’s office said another four employees were checked over by EMTs onsite, but refused to be taken to the hospital. They said the release was contained by on-site personnel and the local emergency units. Police cleared the scene around midnight. Mochal said the entire plant, where potatoes and vegetables are processed, was shut down, and only the areas not involved with refrigeration were being restarted later the next day.
2,000 gallons of acid spilled at Utah site
Salt Lake City — Some 2,000 gallons of highly concentrated sulfuric acid was released here May 4 when a hose ruptured at a Brenntag Pacific facility. About a dozen employees at work at the time self-evacuated the building and also were not injured. “The two operators were performing the chemical transfer outside of the building when the hose ruptured,” Salt Lake Fire Department spokesman Jasen Asay told Green Markets. “At first they thought between 500-1,000 gallons spilled, but later estimated that nearly 2,000 gallons of high concentrate sulfuric acid, reportedly about 93 percent, was involved.” Scott Anderson, director of the Utah division of solid and hazardous waste, which provided oversight for the state, explained that most of the acid – or approximately 1,700 gallons – was able to be recovered for use by Brenntag Pacific. He said the remainder ended up in a gravel sump underneath the tracks and was carefully removed. The acid ended up in the containment area mixed with gravel and was removed manually with the help of a vacuum truck to was to be transported to an offsite disposal area. Brenntag Pacific is a chemical distributor with locations around the western United States.
Report predicts ICL growth will slow
Tel Aviv — An increase in global potash production over the next few years is expected to slow growth at Israel Chemicals Ltd. (ICL), according to a report by Leader Capital Markets, a leading Tel Aviv-based investment bank. The report predicts that rising potash production could lead to industry-wide utilization declining from 90 percent in 2011 to 80 percent in 2015, and for potash prices to fall from $450/mt to $430/mt. This is based on an expected increase in global potash capacity of 16 million tons, or 25 percent, to 80 million mt/y. Although ICL net profits in 2012 are predicted to be $1.4 billion on revenues of $7.1 billion, based on a 4 percent drop in the quality of potash sold and on stable prices, the report foresees a 10 percent drop in prices and quantities of potash sold over the next three years. Another factor is the $1.7 billion cost of removing the salt accumulations from the Dead Sea evaporation ponds as part of the agreement signed earlier this year with the Israeli government. ICL is planning to increase potash production at the Dead Sea, as well as in Spain. Capacity is being increased from 6 million mt to 6.5 million mt by 2015. ICL said recently it believes it is shielded somewhat from the rising capacity as it has low potash production costs. Regarding India, ICL said that it expects a new agreement with Indian customers to be signed in the third quarter.
The Week in Fertilizer Stocks
The Week in Fertilizer Stocks
| Producer | Symbol | Price | Week Ago | Year Ago |
| Agrium | AGU | 80.71 | 77.18 | 81.31 |
| CF Industries | CF | 168.08 | 154.25 | 146.55 |
| CVR Partners | UAN | 21.52 | 21.93 | 16.82 |
| Intrepid Potash | IPI | 19.69 | 19.14 | 30.45 |
| Mosaic | MOS | 48.74 | 45.68 | 67.26 |
| PotashCorp* | POT | 40.20 | 38.91 | 52.97 |
| Rentech Nitrogen | RNF | 23.40 | 23.39 | N/A |
| Terra Nitrogen | TNH | 201.35 | 182.06 | 110.25 |
| Distribution/Retail | ||||
| Andersons Inc. | ANDE | 44.45 | 45.57 | 41.50 |
| Deere & Co. | DE | 75.67 | 72.97 | 81.65 |
| Scotts | SMG | 44.22 | 44.62 | 56.74 |
| * represents three-for-one stock split | ||||
Spot Barge Prices
CP Rail strike begins; fertilizer industry urges action
The Teamsters Canada Rail Conference, a union representing 4,800 engineers, conductors, and rail traffic controllers, went on strike shortly after midnight May 22 after negotiations with Canadian Pacific Railway (CP) failed to produce a new labor deal.
The strike halts CP’s freight services across Canada, although commuter-train services in Vancouver, Toronto, and Montreal, will remain in operation after CP and the union agreed ahead of the strike deadline to allow those services to continue.
Canadian Labor Minister Lisa Raitt is scheduled to meet with the two sides on May 23 when negotiations resume. "The Government is concerned about the national economic significance this will have and we are prepared to act in the interest of the national economy," Raitt said in a statement.
The Canadian Fertilizer Institute (CFI) on May 21 issued a statement urging the Canadian government to act quickly to enact back-to-work legislation, saying ending the strike “is critical to sustaining Canada’s domestic and export markets.”
CFI said the Canadian fertilizer industry faces an annual logistical challenge of moving 25 million mt of product, and member companies are currently facing the combination of tight inventories and strong global demand for all fertilizer products.
“The domestic, U.S., and offshore demand for Canadian fertilizer has been very high this spring and this trend is expected to continue,” CFI said. “Our members currently have large unit trains of potash scheduled to move from western Canada to Vancouver for export offshore, as well as various fertilizer products scheduled to move domestically and cross-border to the important U.S. market. CFI members simply cannot afford the repercussions of a rail disruption.”
CFI President Roger Larson added that “once this issue is resolved, the government must look at long-term action to prevent labor disputes that are essential to the long-term economic health of our country.”
CP and the union, which has been without a contract since the end of December, are at odds over employee pension benefits.
Dyno NobelÆs proposed NH3 plant to be located in Louisiana
Dyno Nobel International announced on May 23 that Waggaman, La., is the site for an $800 million ammonia production facility that the company is considering. Dyno Nobel will complete a $30 million feasibility study on the project, with the proposed plant slated to produce 750,000 mt/y at Cornerstone Chemical Company’s existing complex on the west bank of the Mississippi River in Jefferson Parish.
The announcement was made by Louisiana Gov. Bobby Jindal and Simon Atkinson, president of Dyno Nobel International, and comes after Australian company Incitec Pivot Ltd. (IPL), the owner of Dyno Nobel North America, earlier reported that it was studying the project to leverage low-cost U.S. natural gas and backward integrate the entire ammonium nitrate production of the business (GM May 21, 2012).
Atkinson described the proposed facility as "a strategically compelling world-scale ammonia project that would take the Dyno Nobel global explosives business back to low-cost U.S. gas economics." If the feasibility study confirms proceeding with the facility, Dyno Nobel will announce a decision to move forward with the project in the first half of 2013, with initial production slated for late 2015.
Cornerstone already produces acrylonitrile, melamine, and sulfuric acid at the Waggaman complex, and the ammonia plant would be integrated with Cornerstone’s existing infrastructure. An ammonia plant once operated at the site before closing more than a decade ago.
"The plant is on a brownfield chemical complex site," Atkinson said. "The site currently has several downstream chemical plants operating and one that would off-take ammonia from the plant. In addition, it has a capital advantage, as the infrastructure for the ammonia plant already exists."
Louisiana Economic Development’s Business and Expansion Retention Group began discussing possibilities with the companies in April 2011, and has been working on the project with the Jefferson Parish Economic Development Commission. To secure the project, the state will offer a competitive incentive package to be finally negotiated at the conclusion of the feasibility study.
"We are excited to welcome Dyno Nobel to Louisiana," said Greg Zoglio, CEO of Cornerstone. "The U.S. Gulf Coast economic model has changed due to the advent of advanced drilling and extraction techniques and the associated impact on natural gas pricing. Dyno Nobel’s foresight of this paradigm shift, coupled with the brownfield offering by Cornerstone Chemical Company and project support provided by the State of Louisiana, will allow the resurgence of world-class ammonia production in the state."
"Dyno Nobel’s interest in building a new facility here speaks volumes about the affordable, abundant supply of natural gas across Louisiana, the performance of our energy markets, the state’s strong business climate, and our world-class workforce,” said Gov. Jindal. “With the new production of unconventional natural gas plays in Louisiana, more and more companies are recognizing that our state is uniquely positioned to provide major supplies of natural gas to companies all over the country. We’re confident that when the company’s due diligence is done and a formal investment decision is made early next year that this project will move forward and bring tremendous economic benefits to this region."