Arthur Companies Inc. has announced an agreement to build and lease a liquid fertilizer terminal near Harvey, N.D., for exclusive use by Koch Nitrogen Company LLC. The new facility will store 2.5 million gallons of liquid fertilizer. Construction is scheduled to begin later this summer.

“As liquid fertilizer use continues to grow in central North Dakota, we’re happy to be working on a project that will result in more opportunities for the grower,” said Brooks Burgum, CEO of Arthur Companies. “By working with Koch Nitrogen, we are gaining a partner that understands the values and needs of the customer.”

Headquartered in Arthur, N.D., Arthur Companies’ range of businesses include grain elevators, farms, a birdseed company, and the Agresource wholesale fertilizer operation in Carrington, N.D. In addition to the Harvey, Arthur, and Carrington locations, Arthur Companies also operates North Dakota grain and agronomy facilities at Anamoose, Ayr, Buffalo, and Page.

“This project is an important step in our ongoing efforts to provide value for our customers,” said Scott McGinn, Koch Fertilizer’s senior vice president, North America. “I am confident our relationship with Arthur Companies will greatly benefit the strategic growth of our liquid fertilizer business in the Northern Plains.”

On July 21, 2014, The Mosaic Co. and Mosaic and its subsidiaries, decided to permanently discontinue production of muriate of potash (MOP) at its Carlsbad, N.M. facility. The final date for production is expected to be Dec. 31, 2014.

The decision is based on the quality of the ore in the Carlsbad basin and the age of the facility’s infrastructure. Mosaic said these combined factors make it difficult for the operations to remain competitive in an already challenging global market. Mosaic said the discontinuation of this product at Carlsbad is a further step in the company’s previously announced ongoing asset optimization initiatives. The larger potash production facilities at Esterhazy, Belle Plaine and Colonsay in Saskatchewan, Canada will continue to produce MOP.

Mosaic’s plan for the immediate future is to transition the Carlsbad facility to the exclusive production of our highly valued K-Mag^® product line. K-Mag is a premium potash product that currently represents approximately 70 percent of production at the Carlsbad facility and is a long-term strategic asset for the company.

Mosaic estimates that the discontinued production will result in total pre-tax charges in the range of $135 million to $160 million (primarily in the form of non-cash accelerated depreciation and depletion charges of approximately $105 million to $130 million and cash severance charges of $10 million to $20 million). The third quarter pre-tax charges are estimated to be in the range of $55 million to $75 million with the majority of the remainder expected to be recorded in the fourth quarter.

The India Potash Ltd. (IPL) tender closed July 21 with almost 4 million mt offered by 34 companies. The lowest price was $274.77/mt CFR from Liven for 120,000 mt. An additional 1.3 million mt was offered between $274.87/mt CFR and $275.99/mt CFR.

With roughly only a dollar difference, sources expect that many of the offering companies will meet the Liven number. Sources say a lot will depend on the discharge ports.

All told, IPL could end up with about 1.5 million mt from this tender. Sources had earlier speculated that if IPL could buy this much urea, additional purchases for this season may not be needed. If India steps out of the import market, observers say there will be little left to support prilled prices.

The sub-$276/mt CFR prices reflect a netback of $260-$262/mt FOB in China. This price indicates that the efforts by the Chinese Nitrogen Industry Association (CNIA) to artificially raise the price failed.

In the end, the eight lowest offers reflect prices slightly lower than predicted levels. Going into the tender, sources were estimating offers in the upper $270s/mt CFR. About 1 million mt were offered in the $277-$279/mt CFR range. Close to another 1 million mt were offered in the $280s/mt CFR, and 275,000 in the $290s/mt CFR.

While the Liven price is about $8/mt higher than what STC paid in its tender last month, STC was only able to buy 300,000-320,000 mt at the $266-$269/mt CFR level because few companies could match that low price. The bulk of the offers in that tender were in the $272-$274/mt CFR range.

Fearing the possible danger of another outlier with extremely low prices, IPL made it clear in the tender documents that they reserve the right to reject the lowest price. One trader noted that IPL has more flexibility than STC and MMTC in making this kind of decision.

The offers remain valid until July 25, so IPL will have to make its awards soon. Sources had expected IPL to move quickly anyway. The deadline for shipping is Sept. 7.

See a complete listing of the offers in the July 28 issue of Green Markets.

The U.S. and the rest of the so-called P5 +1 have extended the temporary exemption to sanctions against Iran through Nov. 30, 2014. The exemption allows the purchase of petrochemical products from Iran, including ammonia and urea. Despite the exemption, sources say few banks or insurance companies have been willing to support purchases of Iranian urea and ammonia.

The P5 +1 lifted the sanctions against the purchase or financing of Iranian urea and ammonia in January 2014 as part of the nuclear program negotiations. The renewal of the exemption came as the P5 +1 (China, France, Germany, Russia, the United Kingdom, and the U.S., with the European Union’s High Representative) extended talks with Iran to negotiate a comprehensive solution to ensure that Iran’s nuclear program will be peaceful.

Details of the U.S. Treasury Department rules can be found at http://www.treasury.gov/resource-center/sanctions/Programs/Documents/jpoa_guidance_ext.pdf.

Dead Sea Works workers have ended their sanctions amid ongoing fighting between Israel and the Hamas in the Gaza Strip. The sanctions ended earlier this week and may be connected to the emergency situation in Israel.

Rockets have been fired from the Gaza Strip at southern Israel including areas where Israel Chemicals Ltd. has production plants. However, other than stopping work at the time of alerts the fighting has had no impact on production or exports. Ashdod, the main port for exports to Europe, the U.S., and Latin America, has been the target of dozens of rockets. Many have been intercepted by the Iron Dome system. Work at Ashdod port has continued and ICL said that its exports from the port have not been hit by the ongoing tension.

The sanctions went on for four weeks and were described as ‘sporadic.’ They had only a minor impact on potash shipments.

CF Industries Holdings Inc. said July 16 that it has restarted operating units at its Woodward, Okla., nitrogen complex. As announced on April 21, 2014, CF had shut down production at the complex to address an issue in one of the site’s boilers. During the outage, the plant completed turnaround maintenance activities that previously were scheduled to begin in June.

“We are pleased to have resumed production at Woodward and are in contact with our customers regarding the status of deliveries from the facility,” commented Phil Koch, CF senior vice president, manufacturing.

The Woodward complex has average annual production capacity for 480,000 st of gross ammonia, 820,000 st of UAN, and 25,000 st of urea liquor.