OCI N.V. on June 5 announced that it intends to contribute its methanol and ammonia facility near Beaumont, Texas, to a newly formed limited partnership (MLP) and that it expects the MLP to file a registration statement with the U.S. Securities and Exchange Commission to register an initial public offering of common units to be issued by the MLP. OCI N.V. expects that the initial filing of the registration statement will occur in June 2013.

Subject to market conditions and final approval by OCI N.V.’s board of directors, OCI N.V. anticipates that a minority interest in the MLP will be offered in the IPO in the second half of 2013. The purpose of the IPO is to raise proceeds to repay outstanding indebtedness of the MLP and to fund expenditures relating to the Beaumont facility’s planned debottlenecking project. Additional information will be included in the registration statement once publicly filed.

The Agricultural Retailers Association (ARA) and The Fertilizer Institute (TFI) announced on June 3 that they are partnering on a Fertilizer Code of Practice Initiative to establish uniform safety guidelines for the handling, storage, and distribution of fertilizer products.

ARA and TFI said the goal of the program, which also calls for third-party inspections to ensure compliance, is to create an inspection and auditing system that is effective in improving safety while being transparent, practical, simple, and efficient for retailers. They said the existing system, with specific regulations coming from different agencies, “results in a confusing compliance puzzle that is some cases has duplications and in others has gaps.”

The initiative began earlier this year when ARA’s board of directors decided to evaluate existing codes of practice for anhydrous ammonia handling and storage, but the scope was broadened to include ammonium nitrate after the April 17 fire and explosion at the West Fertilizer facility in West, Texas.

“Safety for our members, employees, and the communities in which they live and work is of paramount importance to everyone in the fertilizer business,” the two organizations said in a joint statement. “This initiative embodies that commitment.”

ARA and TFI said the initiative will provide a comprehensive collection of regulatory requirements and industry best management practices into one code of practice, with subparts for product-specific issues. Part of the mission is also to integrate as much as possible with existing state regulatory programs, again with the goal of efficient compliance for retailers.

ARA and TFI stressed that a fundamental component of the program is third-party audits. “Third-party inspectors will base their audits on adherence to the code of practice,” they said. “The results of the inspection will be made available to participating suppliers, so they know the audit results for the company they’re shipping to, and retailers will also be able to verify that their suppliers are participating.”

Workgroups will be meeting this summer to develop details of the program. The ARA board will receive an initial update report at its fall meeting on September 18, 2013, and a presentation and discussion for ARA member retailers will follow at ARA’s Annual Conference in December.

As an interim step, ARA and TFI, in cooperation with the Asmark Institute and the American Agronomic Stewardship Alliance (AASA), are making information available to retailers about a free Compliance Assessment Tool developed by Asmark for retailers to quickly self-assess their compliance with existing regulations.

The Andersons Inc. and Lansing Trade Group LLC report they have entered into an agreement to acquire Thompsons Ltd., a grain and food-grade bean handler and agronomy input provider, headquartered in Blenheim, Ont., and operating through 12 locations across the province and in Minnesota.

The acquisition, which remains subject to certain customary closing conditions, is expected to close at the beginning of the third quarter. The business, which Lansing Trade Group and The Andersons will equally own, will continue to operate as Thompsons. Lansing Trade Group’s current trading office located in Chatham, Ont., will be consolidated into Thompsons.

"For The Andersons, this acquisition establishes a foothold in Ontario with a similarly diversified agricultural company adjacent to our eastern corn-belt roots. It also enables us to leverage our strengths with those of our partner Lansing Trade Group," says CEO Mike Anderson. "Thompsons is a highly respected, integrated grain, food-grade bean and agronomy business with a similar strategy of cultivating and maintaining strong relationships with growers and end users globally."

"Thompsons Ltd. has always been a respected name in the Ontario agriculture markets," says Bill Krueger, president and CEO of Lansing Trade Group. "The opportunity for Lansing to grow our existing Canadian presence with such a cornerstone company fits our long term strategy. Our partnership with The Andersons will facilitate the entity’s immediate growth in the crop nutrients sector. Thompsons Ltd. will benefit from the combined strength of Lansing and The Andersons in its other areas of business including grains, food-grade products and farm services."

Established in 1924, Thompsons is an integrated supplier of value-added agricultural products and services to growers in Ontario, Minnesota and North Dakota and to food processing customers worldwide. Thompsons owns and operates 12 elevators, 11 retail farm centers, 2 seed processing plants, 5 bean processing plants and a wheat processing plant. Thompsons has a combined owned and leased grain storage capacity of 20 million bushels and 30,000 metric tons of nutrient capacity.

Western Potash Corp. has announced that China BlueChemical Ltd. and Benewood Holdings Corp. Ltd., through a joint venture company, CBC (Canada) Holding Corp., have agreed to make a strategic equity investment of C$ 31,979,022 in Western at a price of $0.71 per common share for a total of 45,040,876 newly issued common shares, which will result in CBCHC holding a 19.9 percent ownership stake in the company on a non-diluted basis. The issue price represents a 15 percent premium over the 20 day volume weighted moving average.

China Blue is a majority owned subsidiary of China National Offshore Oil Corp. (CNOOC), the largest offshore oil and gas producer in China. Benewood is a wholly owned subsidiary of GUOXIN International Investment Corp. Ltd., a financial investment company registered in Hong Kong.

Mr. Patricio Varas, CEO of Western commented, “This investment is a testament to CBCHC’s confidence in the positive business climate in Saskatchewan, the exceptional nature of the Milestone deposit and Western’s team. Our strategic alliance with China Blue and Guoxin will provide Western with access to project financing, technical expertise in large-scale project construction and marketing channels for future potash sales. ”

In addition, Western and CBCHC have agreed to an off-take term sheet under which CBCHC or a purchaser designated by it will enter into an off-take agreement for the purchase of the lesser of 30 percent or 1 million mt of potash annually from Western’s Milestone project for a 20 year term. The off-take agreement will automatically extend for five-year periods unless either party elects not to extend.

CBCHC has a right to appoint one nominee to the board of directors of Western pursuant to the investment agreement.

Closing of the private placement is subject to customary closing conditions including the approval of the Toronto Stock Exchange. It is anticipated that the closing will take place on or about June 14, 2013.

The MMTC urea tender closed June 3 with offered prices significantly lower than the April IPL tender and tons offered significantly higher.

The influence of the opening of the Chinese export season beginning July 1, combined with Iran and the CIS looking for buyers pushed down prices. The lower prices and higher tonnage confirmed industry views that the global urea market has too many tons chasing too few buyers.

The average price from the 31 offering companies came in at $343.73/mt CFR compared the April average of $390.73/mt CFR.

The lowest offer came from Swiss Singapore at $331.50/mt CFR.

The lowest – and winning — offer in April was $379.70/mt CFR. In April the offers totaled 1.9 million mt. This time the total is 4.3 million. Last time IPL only bought about 500,000 mt. Sources at the time said the buyer was taking just what they needed in anticipation of softer prices for the next tender.

Before MMTC closed its tender, traders speculated that if the price was right – some mentioned $330/mt CFR – MMTC might take close to 1.5 million mt.

A change in the rules of the tender regarding Iranian tons could limit what MMTC buys. Late in the game MMTC required that companies offering Iranian tons provide their own insurance. MMTC would cover the insurance for tonnage from any other source.

Sources say the Swiss Singapore low price could reflect Iranian tons because they are specifying delivery to the West Coast port of Mundra. Offers to the East Coast ports are about $3/mt more and could easily reflect Chinese material.

More than 1.5 million mt are reportedly already in the Chinese bonded warehouses, following a dismal domestic season for urea producers. Sources reported last week that traders were already lining up vessels for late-June loadings in Chinese ports. The idea was to have the ships ready to go as soon as the export duty drops July 1.

Agrium Inc. announced on June 3 that it has decided to suspend engineering development on its proposed $3 billion nitrogen greenfield project in the U.S. Cornbelt, and focus instead on efforts to secure a strategic partner and a gas contract for the project at this time.

Agrium first announced plans for the plant in June 2012, saying at that time that the facility would produce approximately 2 million mt/y of primarily urea and UAN, with some excess ammonia left over to sell (GM June 18, 2012). Agrium said then that the facility Agrwas needed because of tight nitrogen supplies in the Midwest where the company operates many retail facilities. Initial plans called for the plant to be fast-tracked for a startup in early 2017, pending board approval.

Ron Wilkinson, Agrium senior vice president and president of Wholesale, said back in June 2012 that the Midwest facility would fill “a fairly big market gap” for the company. “We’re in the west, we’re in the east, but we’ve got a little bit of a gap in the middle, especially when it comes to urea and UAN,” Wilkinson said. “This would really fit that market very well for us. And obviously, our retail is very, very big there.”

Agrium also announced on Monday that it expects to reach a decision in the second half of 2013 on its proposed brownfield expansion at the company’s Borger, Texas, facility. The $500 million Borger expansion calls for an ammonia debottleneck and a urea brownfield, which would add approximately 120,000 mt/y of ammonia production and 640,000 mt/y of urea production and also allow the company to better flex between urea and ammonia. That project, also announced in June 2012, initially called for a startup in 2016.

Agrium had said back in June 2012 that its goal was to have full board approval within the year for its Midwest greenfield project, the Borger expansion, and another expansion planned for its Redwater, Alberta, facility. The Redwater project, which called for a $150 million urea debottleneck that would have added 170,000 mt/y of urea for a planned startup in 2015, has also reportedly been suspended.

Current urea capacity at Redwater is 700,000 mt/y. The facility also produces ammonia, MAP, and ammonium sulfate, with total annual capacity of 2.2 million mt of finished fertilizer products.