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CHS eyes another expansion

Breaking Industry News, Northern Plains

CHS Inc. reports that it is reviewing plans to break ground on a 196-acre campus in Gwinner, N.D., that will include a grain shuttle loading facility with 2.2-million bushel storage and a 27,000 st dry fertilizer hub plant. This new ag services campus, with state-of-the-art load in/load out, would be expected to open its fertilizer plant in Spring 2016, followed by the grain facility in Fall 2016.

The fertilizer facility, with 1,200 ton-per-hour receiving system, will be part of CHS Dakota Plains, based in Valley City. Grain handling services would be jointly managed by CHS Dakota Plains and CHS Dakota Ag, based in Kindred. Campus plans include a 120-car loop track with an internal 3,800-foot spur track to allow the facility to load 25-car sets from the Red River Valley and western transfer cars directly into BNSF shuttle trains.

“This investment on behalf of our owners will bring much needed speed and space to area farmers,” said Gary Goodroad, region director, CHS Country Operations. “Such a collaborative effort between two of our business units ─ CHS Dakota Plains and CHS Dakota Ag ─ demonstrates the enterprise value of an ag cooperative whose primary commitment is helping its farmer-owners grow.”

The Week in Fertilizer Stocks

Fertilizer Stocks

The Week in Fertilizer Stocks

Producer Symbol Price Week Ago Year Ago
Agrium AGU 105.61 107.20 87.32
CF Industries CF 306.79 307.25 229.57
CVR Partners UAN 11.84 11.58 17.12
Intrepid Potash IPI 13.30 14.19 15.33
Mosaic MOS 48.22 48.66 44.68
PotashCorp POT 36.08 36.25 31.83
Rentech Nitrogen RNF 10.91 11.20 18.39
Terra Nitrogen TNH 122.04 129.43 151.25
Distribution/Retail
Andersons Inc. ANDE 45.73 46.66 53.69
Deere & Co. DE 85.91 89.51 85.93
Scotts SMG 63.70 63.87 60.11

ICL workers on strike

Breaking Industry News, Israel

Workers at Israel Chemicals Ltd.’s Dead Sea Bromine Compounds subsidiary have gone on strike. They took the action on Monday after management called in 140 workers to discuss terms for their being laid off. All 850 workers at the plant in southern Israel went on strike to protest the move and shut down all operations. The union is threatening to strike all ICL plants in solidarity with the Dead Sea Bromine Compounds workers.

Talks between management and the union at the subsidiary broke down late last week. Union leader Avner Ben Senior sent an urgent letter to Israeli Prime Minister Benjamin Netanyahu calling on him to intervene in the dispute. He charged ICL with earning hundreds of millions of dollars annually from natural resources that belong to the Israeli public and then firing workers “to punish the Israeli government for raising taxes on the company.”

So far, there is no firm word as to whether workers at potash producer Dead Sea Works will strike. In January, potash shipments resumed from DSW after over a month of sanctions. The sanctions were halted after an agreement was reached at the Beer Sheba Labor Court whereby ICL agreed to withdraw dismissal notices sent to 134 workers at DSW. The court instructed the parties to hold intensive negotiations to reach an agreement on outstanding issues and report back by Feb. 15. However, the latest developments at Dead Sea Bromine Compounds could have an impact on DSW.

PotashCorp reports fatality

Breaking Industry News

Potash Corp. of Saskatchewan Inc. reported a fatality at its White Springs Phosphate Operations on Jan. 26. “It is with great sadness that we announce the passing of one of our employees Keith Stormant as the result of an incident which occurred at our Swift Creek mine on January 26, 2015,” the company said in a statement.

“I speak on behalf of the employees across our entire company in extending our deepest condolences to the family of our valued colleague,” said Jochen Tilk, PotashCorp president and CEO.

An investigation of this incident is in progress.

MMTC urea tenders enjoys lower numbers

Breaking Industry News, China, India, Urea

The MMTC urea tender closed January 27 with lower delivered prices but with little difference in the netback. Sources say lower freight rates made it possible for the Indians to save money on their purchases and for the Chinese producers to avoid lowering their prices to secure a deal.

Of the 2.4 million mt offered, about 500,000 tons were less than $300/mt CFR. Another 860,000 mt were offered at $300-$304/mt CFR.

The sub-$300/mt CFR material has an estimated netback to China of $285-$288/mt FOB, the level traders were calling the market leading into the tender. Sources say the stability in the netback price came because freight is now $9-$10/mt for shipments between northern China and East Coast India.

The material offered at $300/mt CFR and up fit better into the pricing ideas of producers. Sources say the producers were quoting prices of $290-$291/mt FOB in the run up to the tender.

Stockpiles are reportedly limited for the first half of February. With the Lunar New Year starting Feb. 19, sources say there will most likely be a scramble for shipments the last week of February up to the shipment deadline of March 13.

The Week in Fertilizer Stocks

Fertilizer Stocks

The Week in Fertilizer Stocks

Producer Symbol Price Week Ago Year Ago
Agrium AGU 107.20 97.86 92.60
CF Industries CF 307.25 288.74 242.44
CVR Partners UAN 11.58 10.68 18.02
Intrepid Potash IPI 14.19 13.30 16.34
Mosaic MOS 48.66 45.43 47.77
PotashCorp POT 36.25 35.00 33.26
Rentech Nitrogen RNF 11.20 11.05 20.82
Terra Nitrogen TNH 129.43 119.85 165.71
Distribution/Retail
Andersons Inc. ANDE 46.66 46.55 84.82
Deere & Co. DE 89.51 87.20 88.66
Scotts SMG 63.87 61.04 61.81

Ammonium Nitrate

Ammonium Nitrate, Market Watch

U.S. Gulf: Barges were put in the $300-$305/st FOB range, with little interest. Sources said many have already stocked up and there is little demand.

Western Cornbelt: Ammonium nitrate was reported at a firm $360/st FOB for limited tons in the region. Sources continued to talk of retailers and wholesalers exiting the ammonium nitrate market due to ever-increasing insurance costs in the wake of the West Fertilizer tragedy.

California: The CAN-17 market was quoted in a broad range at $322-$352/st FOB in California, depending on location and supplier, with the low out of coastal terminals and the upper end out of inland desert locations. Some sources speculated that an increase might be in the works for second-quarter purchases. AN-20 remained at $315/st DEL in California.

Pacific Northwest: Agrium reposted CAN-17 on Jan. 19, moving to $300/st FOB Kennewick, Wash., and $325/st rail-DEL in Idaho, Oregon, Utah, Washington, and northeastern Nevada. Those levels reflected a drop from last report. AN-20 was unchanged at $260/st FOB Kennewick and $270/st rail-DEL in the Pacific Northwest.

Permitting for Idaho project suspended – Alert

Breaking Industry News

Stonegate Agricom Ltd. said Jan. 26 that it is temporarily suspended permitting activities at its Paris Hills Phosphate Project in Idaho due to financial constraints.

In order to finalize the groundwater model for permitting applications, the company engaged third-party consultants. Currently there is a wide range of estimates of expected groundwater flow rates into the planned underground mining area. As a consequence, the company will need to undertake further testing and analysis which may include additional engineering work. Given its current financial position, the company cannot undertake additional work at this time. The company no longer expects to submit the groundwater model and report in Q1 2015 as planned. The company is reviewing its options with respect to its next steps.

As of Dec. 31, 2014, cash and cash equivalents totaled approximately $1.4 million and working capital totaled $1.0 million. The company is exploring alternatives to raise additional funds by the beginning of Q2 2015 to cover working capital and fund further work on the project.