Vienna—Ukrainian billionaire Dmytro Firtash, 48, was arrested here March 12 by Austrian police under a warrant issued by the U.S. Federal Bureau of Investigation. The warrant alleges he paid bribes and formed a criminal organization. Firtash has made his money in several ways, including trading natural gas with the Russians, and he has close ties with businessmen in that country as well as the former pro-Russian Ukrainian government. He is also heavily invested in several additional businesses, including nitrogen maker Ostchem and Ukrainian media and banking. The DF Group, which is under his control, reportedly employs some 100,000 in Ukraine. The U.S. is expected to seek extradition. Although the arrest does not appear to have anything to do with the current Russia-Ukraine crisis, observers note that it may send a signal to Russia of what may be in store if the U.S. imposes additional sanctions.
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NOLA UAN at $8.91-$9.22/unit
NOLA UAN barges are $8.91-$9.22 on a per unit basis for the Green Markets dated March 17, 2014. This corrects the $9.06-$9.22/unit price which originally appeared in the issue. The $8.91-$9.22/unit correlates with the correctly reported short ton price of $285-$295/st FOB.
CHS to acquire 16 Canadian retail locations from Agrium
CHS Inc., St. Paul, Minn., has agreed to acquire selected Canadian retail assets from Crop Production Services (Canada) Inc., a wholly owned subsidiary of Agrium Inc. Under the agreement, 16 retail agronomy locations in the provinces of Alberta and Saskatchewan will become part of the Country Operations division of CHS.
The transaction is expected to be completed on or about April 1, 2014. Financial terms were not disclosed.
"We look forward to expanding our ability to serve farmers and ranchers in Canada, and to being a strong partner in their communities," said John McEnroe, executive vice president, CHS Country Operations. "Our goal is always to add value for our customers through local experts with global connections."
CHS said the newly acquired businesses will be able to take advantage of a 42,000-ton fertilizer plant outside Shelby, Mont., that is in its final stages of construction. The new facility offers 110-car shuttle loader access to the BNSF line, and is expected to open for the spring 2014 season.
H.J. Baker completes upgrade to Atmore facility
H.J. Baker, Westport, Conn., announced on March 17 that the company is now operating a third specially customized rotoformer production belt at its Atmore, Ala., fertilizer plant. H.J. Baker said this upgrade will enable the facility to significantly increase production of its Tiger-Sul products and meet customer demand during critical peak seasons.
“This new customized production belt is part of H.J Baker’s ongoing capital improvement plan at our Atmore facility,” said CEO Christopher Smith. “It is another clear example of H.J. Baker’s continued commitment to innovate using the latest technology and to ensure our facilities meet and exceed today’s market demands.”
H.J. Baker said the new rotoformer went through a customized refurbishment that included both Sandvik and Berndorf technologies, as well as the addition of other features to allow employees to customize its mechanics based on individual customer needs.
“The belt will give our facility an overall 50 percent increase in production capacity to better serve our customers during increased seasonal volumes,” said Atmore Plant Manager Matt Kimes. “Our employees can influence and customize the direction of the belt and make changes to meet specific customer requests.”
H.J. Baker’s Atmore facility manufactures Tiger-Sul’s sulfur bentonite fertilizer products, including boron, iron, zinc, and magnesium, which are specifically formulated for row crops in the southeastern U.S., including corn, cotton, soybeans, and peanuts. The facility also manufactures fertilizer for specialty crops such as citrus, vegetables, sugar cane, blueberries, and forage and turf grass. The plant was recently upgraded, adding a 1,500-ton molten sulfur storage tank.
“Customer demand for our fertilizer products is growing throughout the country and around the globe,” said Smith. “In addition to the Atmore upgrades, we recently purchased a production facility in Irricana, Alberta, which will be operating soon. This will increase manufacturing capacity to address customer needs domestically and internationally, and add capabilities such as sulfur forming in the future.”
CF completes sale of phosphate business to Mosaic
CF Industries Holdings Inc., Deerfield, Ill., announced on March 17 that it has completed the sale of its phosphate business to The Mosaic Company for $1.4 billion, or approximately $1 billion net of taxes and other adjustments. The sale follows the terms of the definitive agreement announced on Oct. 28, 2013 (GM Nov. 4, 2013).
“We are pleased to have completed the sale of our phosphate operations to Mosaic,” said Tony Will, CF president and CEO. “The net proceeds from the sale will be redeployed to execute the strategic initiatives we already have in progress, namely our nitrogen capacity expansions and completing our share repurchase authorization. Additionally, the supply agreements we have put in place with Mosaic will provide us a steady base of ammonia demand with attractive economics.”
In conjunction with the close of the sale transaction, CF will begin to supply Mosaic with its share of the ammonia produced by the company’s 50 percent-owned production facility in the Republic of Trinidad and Tobago. Additionally, CF has a long-term supply agreement with Mosaic to supply 600,000-800,000 tons of ammonia per year for up to 15 years from its Donaldsonville, La., nitrogen complex. Deliveries of ammonia will begin no later than Jan. 1, 2017, and will be priced at a defined margin over the cost of natural gas at Donaldsonville.
MMTC awards 675,000 mt in urea tender
MMTC issued awards in its urea tender over the weekend totaling more than 600,000 mt. Most of the tonnage appears to be coming from China.
In addition to the awards, MMTC set port-specific prices. The move is in keeping with past practices by Indian buyers to avoid lengthy individual negotiations. Companies willing to accept the prices offered by India usually get an award. The basis for the awards is $325/mt CFR to Mundra and the West Coast and $328/mt CFR for Vizag and the East Coast.
The awards follow:
| Offering Company | Quantity mt | Port of Discharge |
| Swiss Singapore | 140,000 | Krishnapatnam |
| Global | 135,000 | Mundra-Kandla |
| Amber | 60,000 | Gangavaram |
| Liven | 70,000 | Vizag |
| Continental | 65,000 | Krishnapatnam |
| Helm | 60,000 | Karaikal |
| Quantum | 55,000 | East Coast-Vizag |
| Aries | 50,000 | New Mangalore |
Sources report that Fertisul and MTPL also received awards for 50,000 mt and 60,000 mt, respectively. For most suppliers, the port-specific prices represent a drop in the offered price of $2-$4/mt.
Part of the award to Global is expected to come from Iran. Sources say the 60,000 mt will be unloaded at Mundra and the rest at Kandla. The rest of the awards are expected to come from China.
At $325/mt CFR for the East Coast deliveries, sources put the netback at $307-$310/mt FOB. If the material is all prills, as some traders have claimed, the price represents a slight drop from the last bit of public business. If, however the material is granular, the netback represents a significant drop from the $330s/mt FOB claimed by the producers.
Pinnacle adds three businesses to growing distribution network
Pinnacle Agriculture Holdings LLC has added three companies to its growing portfolio of agri-business acquisitions. On March 11, Pinnacle announced that it had successfully acquired Whittington-Sanders LLC in Tunica, Miss., and on March 10 the company reported that it had purchased Studer Fertilizer in Roanoke, Ill., and New Era Ag LLC in Monroe, Ind.
Whittington-Sanders, formerly a joint venture between Whittington Wholesale and Jimmy Sanders Inc., will now fully operate as part of Pinnacle’s Sanders brand. Whittington-Sanders was formed in 1995 as a full-service farm supply operation, providing seed, fertilizer, crop protection chemicals, feed, and other farm supplies to local growers.
The new Sanders location will be managed by former Whittington-Sanders co-owners Ken and James Whittington, and will remain at its present location at 1265 Highway 61 South in Tunica. The current employees of Whittington-Sanders will retain their positions under the new ownership.
“We have had an excellent run as Sanders’ business partner for the past 19 years. We felt it would be advantageous to our long-time customers to roll 100 percent of our business into the Sanders business model in order to provide more complete and efficient service to our growers,” said James Whittington. “There will be some subtle improvements in supply chain, inventory, and customer account management that will be to their benefit. As far as faces and service, our customers won’t notice any change at all. This should be a great opportunity for our customers and for us.”
“We are extremely pleased with the recent acquisition of our long-time business partner,” said Gill Corban, Sanders area operations manager. “This is a unique situation in that Whittington-Sanders already felt like family. We look forward to continuing this relationship under the Sanders brand, and we are confident that area farmers will experience a smooth transition and continue to receive the same timely, hometown service that they have come to rely on.”
Studer Fertilizer, which was founded in 1994 as a full-service fertilizer supply operation, will now operate as part of Pinnacle’s Providence Agriculture brand. The business will be managed by former owner Rick Studer, and will remain at its present location at 1517 County Road 2100E in Roanoke. Curt Knepp will continue as sales manager for the location, and all other employees of Studer Fertilizer will also retain their current positions.
“Trust is the cornerstone of our life and the success of our business,” said Studer. “I am confident that through Providence, I have found a company with similar values to those upon which Studer Fertilizer built its reputation.”
Studer Fertilizer began in 1961 as Martin Fertilizer, a liquid fertilizer suspension plant. Rick Studer was employed by the Martin family from 1975 until his purchase of the company in 1994, after which Studer Fertilizer enhanced its product line to include conventional dry fertilizer and crop protection chemicals.
“Providence is very pleased with the recent acquisition of this highly-respected business, and we look forward to working with Rick and his staff to provide excellent service to area growers,” said Todd Louiso, Providence area operations manager. “It is obvious that Studer Fertilizer embodies the same core values on which Providence was established – grower success, integrity, innovation and technology, and dedication to our communities.”
New Era Ag in Monroe, Ind., will also be joining Pinnacle’s Providence Agriculture brand. New Era was founded in 2008 as a full-service agribusiness, providing seed, fertilizer, crop protection chemicals, soil sampling, and various lawn and garden products to local growers. New Era serv
MMTC urea tender confirms softer market
Hopes that the return of India to the global urea market would mean an upturn in prices were dashed after the results of the MMTC tender were made public. The lowest offer came from Global at $325/mt and $326.75/mt CFR. Sources estimate the netback to China on this offer to be $307-$309/mt FOB.
The publicly traded prices on Chinese product were last pegged in the $330s/mt FOB for granular and $320/mt FOB for prilled. Sources report, however, that late last week at least one unconfirmed deal was done for prills in the $310/mt FOB area.
Absent from the tender were any direct offers from Arab Gulf producers. Sources speculate the low price needed to be competitive in India dissuaded the producers from participating.
All told 2.09 million tons were presented in firm offers from 22 companies. An additional 700,000 were offered as optional tons.
Going into the tender, industry sources expected MMTC to take about 700,000 mt, maybe more if the price was right.
The Global price is about $10 less than what India paid in its last tender, Nov. 11, 2013, but still dramatically higher than the October 2013 price of $309-$315/mt CFR.
The Indian government is concerned about the price of imported urea because of the drain on the treasury both for the actual product and for the subsidies offered for urea. The higher the import price, the more the government has to pay to the importers in subsidies.
While India frets over higher prices, the Chinese are concerned about lower prices. Sources confirmed that some of the larger Chinese urea producers and major trading houses met this week to discuss prices. The end result, said one international trader is that the producers would try to hold firm on prices and lean on traders to not offer short sales into India. One industry watcher noted that the effort appears to have failed.
See the March 14 Green Markets web edition for more details.
ICL union intensifies sanctions
Israel Chemicals Ltd.’s unions have further intensified sanctions and ordered a total export ban. The export ban went into effect at 6 am Israel time March 11. The export ban was in response to management’s decision to implement a recovery plan unilaterally in absence of talks with the union. Management also threatened a lock out if sanctions continue. In addition sanctions are continuing at ICL plants in Israel.
Rentech Nitrogen posts 4Q loss
Rentech Nitrogen Partners LP posted a fourth-quarter loss of $17.4 million on sales of $54.6 million compared to a year-ago net income of $17.6 million on sales of $92.4 million. Rentech cited lower volumes due to scheduled and unscheduled downtime at its East Dubuque and Pasadena plants as well as weaker nitrogen prices. Full-year net income sank to $4.1 million on sales of $311.4 million down from the year-ago $107 million and $261.6 million, respectively.