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Fire idles Dakota Gas NH3 plant in North Dakota

A nighttime fire at Dakota Gasification’s anhydrous ammonia facility at the Great Plains Synfuels plant near Beulah, N.D., on April 14 has left the ammonia plant temporarily idled during the busy spring planting season.

Company Spokesman Daryl Hill told Green Markets that the fire alarm at the facility went off at 11:30 p.m. Saturday. The fire, which was concentrated in the front-end portion of the ammonia unit, was quickly extinguished by Dakota Gasification’s own fire crew. Hill said no rural or city fire departments were involved in the effort.

There were very few employees in the plant at the time of the blaze given the late shift, and no injuries were reported as a result of the fire. The blaze also resulted in no ammonia release at the site.

Hill said there were no estimates yet on what caused the blaze, how much damage the facility sustained, or how long it will be offline. “It will take awhile to get it opened up and determine exactly what happened,” he said. “It’s a pretty big vessel to look at, so it will take some time to check everything out.”

Hill acknowledged that the outage comes at an inopportune time during spring planting, when ammonia usage on corn ground is heavy. “This isn’t the best time of year for this to happen,” he said, but he added that the company is “moving as fast as we can” to repair the damage and return the plant to operation.

At capacity, the ammonia plant at Beulah produces 1,100 st/day, or some 400,000 st/year, and the facility was producing ammonia at full rates when the fire broke out. The facility’s gasification plant was unaffected by the fire and continued operation last week. Hill said the production of ammonium sulfate at Beulah, which uses a flue gas desulfurization system, was also unaffected and continued operation.

Earlier in April, Dakota Gasification reported that foundation work was underway on a new 30,000-gallon anhydrous ammonia storage tank at the Beulah plant. The company first announced plans for the tank last December (GM Dec. 12, 2011), saying it will double ammonia storage capacity at the site.

Contractors broke ground on the $38 million project on March 21, with the new tank located next to the existing 30,000 gallon storage tank on the south side of the plant. Tank construction is expected to be complete by October, with project completion scheduled for early 2013.

“The geo piers are finished, and foundation work is in progress,” said Matt Miller, project manager. The tank’s dike wall is being raised about 1.5 feet and is about one-third complete, the company reported, but driving on the dike wall is no longer permitted until construction is complete. Miller said most of the materials are purchased to begin fabricating the steel plates for the new tank, and the glycol skid, tie-in points, and flare recommendations are currently being reviewed. The 60-percent design review for the project is scheduled for May 3.

“The additional storage will help the plant benefit from better anhydrous ammonia margins available throughout the year,” the company said on April 5. “Ammonia sales and markets are the best they’ve been in many years.”

Back in December, Dakota Gasification also confirmed that it was conducting a pre-front-end engineering and design (FEED) study for building a urea production facility adjacent to the Synfuels plant in Beulah. The pre-FEED study was expected to be completed by the end of the first quarter of 2012, and will give the company a much firmer cost estimate so it can determine whether to proceed with the urea plant.

Steven Liebelt, marketing manager for Dakota Gas, told Green Markets on April 19 that the results of the pre-FEED were not yet available.

Sulfur

Tampa: Phosphate producers and their sulfur suppliers were in the process of finalizing new prices for their second-quarter contracts for delivery of molten sulfur to Tampa late last week. The new price was not made available and will not be until Mosaic has reached terms with all of its major suppliers. Green Markets will not change its price for molten sulfur delivered to Tampa until all major suppliers have reached an agreement.

No transportation problems were reported last week.

Refinery operating capacity rates increased 0.8 percent last week, from 83.8 to 84.6 percent the previous week.

The ADNOC sulfur price was posted at $200/mt FOB for the month of April.

Potash

U.S. Gulf: Barge prices were harder to gauge, with more disagreement. While some put recent trades in the $480-$490/st FOB range, others argued that they have slipped to the $470s/st FOB.

Eastern Cornbelt: The potash market in the Eastern Cornbelt region was steady at $525-$535/st FOB, depending on grade and location. Sources tagged the Cincinnati market at the $530/st FOB level at mid-month.

Western Cornbelt:
Potash pricing continued to slip in the region. The low end of the granular potash range was quoted at $510-$525/st FOB in Iowa on a spot basis, while dealer reference levels in the Missouri market remained at $535/st FOB for red and $542/st FOB for white granular tons.

Northern Plains:
Potash pricing was slipping in the Northern Plains. Minnesota sources pegged the warehouse market as low as $515/st FOB for granular potash last week, with delivered tons reported in the $525-$535/st level in central North Dakota.

Northeast:
Granular potash was generally quoted at the $540/st mark FOB regional warehouses, with rail-delivered tons quoted at $560/st in the Northeast.

Eastern Canada: Potash pricing out of Ontario warehouses had reportedly slipped to $610/mt FOB for red granular and $620/mt FOB for white granular tons. Sulfate of potash (SOP) was steady at $830/mt FOB in Ontario.

The K-Mag market was tagged at $495/mt FOB regional warehouses, and remained in tight supply.

Brazil: Uralkali has raised its price to buyers in Brazil to $550/mt CFR, starting in May, from the current $520/mt. The company said Brazil has depleted its inventories and is actively buying now. Quizzed by analysts, the company said the price could go up as high as $580/mt CFR this fall as Brazil can afford this price, but that would depend on intervening market factors, including international demand and pricing to other customers.

Phosphates

Central Florida: Although summer fill on the river system was underway late last week, that was not the case for those who buy by rail from Central Florida.

Dealers – at least small independent ones – were holding fast to the belief that prices will fall, despite signs to the contrary. Summer fill prices on the river were up last week, and not much different from those for prompt.

In some areas farther to the north, frost was still a problem, despite a brief heat wave that swept in for a couple of days last week. A trader said the high price of seed corn was putting pressure on farmers there to hold off on planting to avoid the possibility of having to replant.

Producers were holding firmly to their $460/st FOB price for DAP, and some feared that that may be an indication of higher prices to come. However, there was no word from producers themselves on a Central Florida price hike.

Late last week, phosphate producers were in the process of settling contracts on new fourth-quarter sulfur prices, but the new price was not available.

The Central Florida DAP price remained unchanged last week at $460-$465/st FOB. CF Industries was posted at the $460/st FOB mark, and Mosaic was also at $460/st FOB. MAP was listed at a $20/st premium to DAP by Mosaic in Central Florida, about the same difference as from traders. However, MAP was virtually unavailable in Central Florida.

PCS Sales was selling at prices comparable to the market.

U.S. Gulf: In real estate, the three most important things to consider are location, location, and location. For the past few weeks, this has been true when it comes to NOLA phosphate barges as well.

Barges to be loaded within a week were selling for $10-$15/st FOB less than those already moving on the river system. Even then, location was the biggest factor in the price, regardless of adjustments for transportation.

Sources said a NOLA DAP barge to be loaded within a week at New Orleans could be purchased for about $480/st FOB, while those at or near St. Louis were available for around $490/st FOB, and a DAP barge at Cairo, Ill., on the Ohio River was selling for $495/st FOB. However, somewhat fewer NOLA DAP barges were traded last week compared to the previous week. In addition, sales of barges for delivery in June and July were running $475-$490/st FOB.

All of those prices were higher than the previous week, and about what terminal prices were a week or two ago, depending on the location. That meant warehouse prices were heading up to adjust for the higher barge cost.

Crop prices were mixed last week. Corn and wheat prices continuing their southerly movement, but soybeans improved a little. Prices for corn futures fell from $5.4725/bushel the previous week to $5.3775/bushel for December 2012. The corn price for December 2013 was $5.3625/bushel, decreasing from $5.4625/bushel the previous reporting period. Soybeans for November 2012 moved up to $13.85/bushel from $13.7475/bushel the previous week, and beans for November 2013 increased to $12.54/bushel from $12.5375/bushel a week earlier. Wheat for July 2012 fell to $6.305/bushel from $6.4425//bushel the week before, and wheat for July 2013 was listed at $7.005/bushel last week, down from $7.0575/bushel previously.

Based on a combination of actual transactions, bids, and offers, the prompt NOLA DAP barge price range for the week was $480-$495/st FOB, up from the previous week’s range of $470-$480/st FOB for domestic product.

Eastern Cornbelt: DAP pricing continued to inch upward, with steady demand reported. Sources quoted the dealer market at $515-$530/st FOB warehouses in the region, with the low reported in Illinois and the upper end in the Ohio market.

MAP was pegged at $525-$535/st FOB. Several sources noted the premium

Ammonium Sulfate

Eastern Cornbelt: The ammonium sulfate market remained in tight supply at $415-$445/st FOB in the region. Ammonium thiosulfate was quoted at $375-$380/st FOB.

Western Cornbelt: Granular ammonium sulfate pricing was tagged at $420-$445/st FOB in the Western Cornbelt, with the upper end reflecting dealer reference levels. The ammonium thiosulfate market had reportedly firmed to $380-$385/st FOB in the region.

Northern Plains:
Granular ammonium sulfate was quoted at $415-$430/st FOB in the Northern Plains, with the low reported in North Dakota for limited tons and the upper end in the Minnesota market. Effective April 6, Honeywell’s granular ammonium sulfate posting firmed to $445/st FOB Roseport Minn., with mid-grade referenced at the $415/st level FOB Roseport and Red Rock, Minn.

Northeast: Delivered ammonium sulfate remained in the $385-$405/st range in the region, but supplies were tight. “All nitrogen is short right now,” said one source.

Eastern Canada:
Granular ammonium sulfate pricing had reportedly strengthened to $485-$530/mt FOB in Eastern Canada, with the upper end quoted as a dealer reference in both Ontario and New Brunswick for new sales.

Expectations for a record 20-21 million acres of canola in Western Canada this spring have resulted in heavy demand for all nitrogens, but particularly for ammonium sulfate. “There is more demand than there is product,” said one contact last week. If realized, this year’s canola acreage should easily surpass last year’s record high of 18.5 million acres in Canada.

Ammonium Nitrate

U.S. Gulf: Product has been so hard to find, sources were putting prompt trades in the $410-$435/st FOB range. However, others said forward cargoes into May were lower priced, easily below $400/st FOB.

Western Cornbelt: Ammonium nitrate remained at $450-$480/st FOB in the region, with reports of tight supply.

Eastern Canada: No current prices were reported for ammonium nitrate in Eastern Canada last week. Some locations were reported sold out of product in advance of May applications on tobacco, while others reported that the spring application window for ammonium nitrate had already passed in their location.

Nitrogen Solutions

U.S. Gulf: Prompt barges moved up last week, with sources calling early trades at $385/st ($12.03/unit) FOB. However, by the end of the week, most were starting to call the market $390-$400/st ($12.19-$12.50/unit) FOB, with some saying the next trade would soon be $405/st ($12.66/unit) FOB.

Eastern Cornbelt: The UAN market in the Eastern Cornbelt was pegged in a broad range at $13.45-$14.30/unit FOB regional terminals, depending on location. Sources said UAN-28 pricing out of the Cincinnati market had firmed from $375/st ($13.39/unit) to $400.40/st ($14.30/unit) FOB at mid-month.

Western Cornbelt: The UAN-32 market in the Western Cornbelt was quoted at $430-$450/st ($13.44-$14.06/unit) FOB regional warehouses, indicating another increase from last report. One Missouri source tagged the dealer market solidly at the $440/st ($13.75/unit) FOB level in his trade area last week. An Iowa contact said most of the spring fertilizer demand was winding down in his location, except for sidedress UAN applications.

Northern Plains: Sources in Minnesota and South Dakota pegged the UAN market at $375/st FOB for UAN-28 ($13.39/unit) and $430/st for UAN-32 ($13.44/unit) FOB, but tons were tight. Delivered UAN-28 was quoted at $435-$455/st ($15.54-$16.25/unit) in North Dakota, depending on location, with reports of “very little prompt ship” tons available on the market.

Northeast: UAN prices continued to firm dramatically in the region, and inventories were very tight. Sources tagged the UAN-30 market at $372-$375/st ($12.40-$12.50/unit) FOB Baltimore for new tons, up from the previous week’s $345-$350/st ($11.50-$11.67/unit) FOB range. Sources also reported UAN-32 out of Baltimore in the $400-$410/st ($12.50-$12.81/unit) FOB range as the week advanced. “Availability is extremely tight, and I expect there to be market shortages for pull in late May/early June,” said one contact.

Out of terminals in upstate New York, sources quoted the UAN-32 market at $432/st ($13.50/unit) FOB to the dealer.

Eastern Canada: UAN was in very tight supply and under allocation in Eastern Canada at mid-month. The UAN-32 market had firmed to the $455-$471/mt ($14.22-$14.72/unit) FOB range in the region, depending on location, with UAN-28 pegged in a broader range at $398-$420/mt ($14.21-$15.00/unit) FOB. New vessels were reported on the way and slated for arrival later in April.

Urea

U.S. Gulf: Most players last week were calling the prompt market in the $680-$700/st FOB range, with a few saying trades were still done over the $700/st FOB range at the very beginning of the week. One said another wave of demand is in sight, and with supplies under pressure, prices may stop their erosion and rebound.

Another pointed to problems on the Arkansas River, where barge tows are temporarily halted by one barge line due to water levels. As a result, they said the Catoosa/Inola area, which is out of urea, will see a five-day delay before seeing any more barges. Another added that due to water levels on the Mississippi, barges on that river are going slowly, and are about two-three days behind normal.

Eastern Cornbelt:
Tight supplies and brisk demand continued to drain nitrogen inventories at many regional terminals last week. Sources at midweek reported that Cincinnati, Ohio, was out of urea and would probably remain that way for up to ten days. Illinois sources quoted the granular urea market at $730-$740/st FOB if you could find tons, with the upper end of the regional market pegged at the $775/st mark FOB E. Liverpool, Ohio.

Western Cornbelt:
Most locations were “in and out of urea” last week, as one source described it. Some would-be buyers were reportedly sourcing tons from up to 350 miles away.

Where available, the granular urea market in the Western Cornbelt was quoted at $730-$750/st FOB regional terminals. One source pegged the St. Louis, Mo., market at the $740/st FOB level at midweek, with “very short” inventories.

Northern Plains:
Nitrogen inventories were very tight in the region last week. One source said urea was unavailable out of the Twin Cities market at midweek. Others quoted allocated tons out of Pine Bend, Minn., firmly at the $730/st FOB level. In North Dakota, sources pegged the urea market at $765/st FOB for “very limited tons,” with delivered urea pegged as high as $800/st or more in the state.

Northeast: Granular urea pricing covered a broad range in the Northeast, but availability was the bigger issue. Several sources said the last prices they had picked up out of the Philadelphia market were at the $700/st FOB mark or slightly higher, but there were no confirmed reports of spot tons available at that level last week. Urea was not available out of Savannah, Ga., but pricing in that market had reportedly been at the $730/st FOB mark the previous week for any available tons. Out of E. Liverpool, Ohio, urea suppliers were referencing as high as $775-$790/st FOB last week.

Eastern Canada: Granular urea pricing covered a broad range in Eastern Canada – if you could find tons. Where there were still older inventories to tap, sources reported dealer pricing at the $780/mt FOB level, which was up some $150/mt from last report. In areas where new tons were coming in and pricing had been adjusted to reflect new replacement costs, sources quoted the granular urea market as high as $850/mt FOB out of terminals to the dealer.

Pakistan:
After much deliberation, the Economic Coordination Committee (ECC) shifted from calling on TCP to import 600,000 to importing only 300,000 mt.
At first it appeared as if TCP was going to wait to see if the market price shifted down in the second half of April. Instead, it called for a tender to close May 21.
Documents were sent to potential suppliers and trading houses the middle of last week. By week’s end, however, the TCP planners seemed to want to change the closing date.

May 21 is right in the middle of the annual IFA conference. Sources say the last thing TCP needed was to close a tender when the entire fertilizer industry is meeting in Doha. Further indication of

Ammonia

U.S. Gulf/Tampa: Most of the focus last week was on the international market and what it would eventually mean for Tampa. Sources reported that PotashCorp bought 25,000 mt on the Elversele from Transammonia at Yuzhnyy at $460/mt FOB for the U.S. Gulf, for delivery to Geismar in mid-May. Sources put freight rates in the mid-$90s/mt, which would take the delivered price up to approximately $555/mt.

As a result of this business, sources say Yara will undoubtedly be looking for a significant boost to its Tampa number for April, which was $470/mt DEL.

Eastern Cornbelt: The anhydrous ammonia market was quoted at $730-$750/st FOB in the region, with the low in Illinois and the upper end out of Indiana terminals.
Sources said preplant demand for ammonia had slowed, but outages continued to be reported at some locations last week. “It’s just as well that there is no great demand at the moment,” said one source.

Corn planting continued at a brisk pace in the Eastern Cornbelt last week. As of April 15, Illinois growers already had 41 percent of the crop in the ground, well ahead of the five-year average of six percent. Elsewhere in the region, corn planting was rated at 24 percent complete in Indiana and 10 percent in Ohio by April 15, also well ahead of the average pace in both states.

Western Cornbelt: The anhydrous ammonia market was quoted at $630-$690/st FOB terminals in the Western Cornbelt, depending on location, with the lower end reported in Nebraska and in western Iowa on a spot basis.

As of April 15, corn planting had progressed to 39 percent complete in Missouri, 5 percent in Iowa, and 4 percent in Nebraska. Missouri’s cotton crop was 4 percent planted by that date, but rice in the state was already 71 percent planted, well ahead of the five-year average of 10 percent by this date. The oat crop in Iowa and Nebraska was 77-87 percent planted by April 15, also ahead of the average pace.

Northern Plains: Minnesota sources quoted the anhydrous ammonia market in a broad range at $650-$730/st FOB last week, depending on the terminal. North Dakota sources quoted delivered ammonia in the $780-$790/st range for “very limited” tons at midweek.

Favorable weather allowed growers to make great strides on spring planting in the Northern Plains region in April, although many areas were sidelined by rains last week. The moisture was welcomed, as much of the region experienced an extraordinarily dry winter.

As of April 15, corn planting had progressed to 7 percent complete in Minnesota, compared with 3-4 percent in the Dakotas. The sugar beet crop was 24 percent planted in Minnesota and 13 percent planted in North Dakota by that date. As for small grains, the spring wheat crop was already 83 percent planted in South Dakota by April 15, compared with 56 percent in Minnesota and 27 percent in North Dakota, and the barley crop was 35 percent planted in Minnesota and 17 percent planted in North Dakota by that date.

Eastern Canada:
Eastern Canada sources quoted dealer reference pricing for anhydrous ammonia at the $900/mt mark FOB Courtright, Ontario.

Black Sea:
Asian sources confirmed a deal out of Yuzhnyy at $460/mt FOB last week. Sources say Transammonia handled the sale.

The former correlation between the Yuzhnyy and Tampa prices is pretty much broken, say sources. The Yuzhnyy price of $460/mt FOB would translate roughly to $550/mt CFR into Tampa, instead of the current $470/mt CFR.

One trader noted that the industry should expect to see the Tampa price move up in the next couple of months to meet the Black Sea levels. Until then, tonnage out of Yuzhnyy will most likely be heading to places other than the U.S.

Sources ta

The Mosaic Co. – Management Briefs

The Mosaic Co. has named Corrine Ricard as senior vice president of its human resources department. As a member of Mosaic’s senior management team, she will report directly to President and CEO Jim Prokopanko and will be based in Plymouth, Minn.

Previous roles held by Ricard at Mosaic include vice president of international sales and distribution, vice president of business development, and vice president of supply chain and risk management.

She earned her bachelor’s degree in finance at the University of Minnesota and an MBA in strategic planning from the Carlson School of Management at the University of Minnesota, and completed the Advanced Management Program at Harvard Business School.