Australian fertilizer producer Incitec Pivot Ltd. (IPL) reported on Feb. 11 that it began a progressive shutdown of plants within its Phosphate Hill facility over the weekend due to flooding in northern Queensland brought on by a 100-year rain event.
IPL said its facility has not sustained any damage, but excessive flooding caused the closure of a rail line between Townsville and Phosphate Hills. IPL said it is continuing to run each plant for as long as possible given storage and input constraints, but it estimates that the impact of the rail closure will cause EBIT losses of approximately A$10m per week beginning on Feb. 9 and continuing until full production is resumed.
“IPL understands that the rail infrastructure provider is waiting for conditions to improve in order to allow full access to the rail line and assess when rail services are likely to resume,” the company said. IPL noted that the Townsville fertilizer distribution and port facilities suffered “only very minor damage and are operational.” IPL said it will provide an update when it receives a reliable estimate of the duration of the rail outage.