Officials with Old World Industries and Unity Envirotech of Illinois LLC (Unity) provided more details about the alliance that the two companies announced in August (GM Aug. 31, p. 1). Under the agreement, Old World will be the exclusive sales, marketing, and distribution agent for the ammonium sulfate (AMS) that Unity produces at its Henry, Ill., facility.
The agreement marks Old World’s first foray into fertilizer, said Scott Vanderventer, who will lead the alliance. Old World is currently the number one supplier for antifreeze, coolant, and DEF in North America, with well-known brands that include PEAK Performance® automotive products, BlueDEF® and Victory Blue™ diesel exhaust fluid, and Final Charge® and Fleet Charge® coolant products.
Old World Industries has a strategic growth initiative to grow into the ag space with new products, alliances, and partnerships,” Vanderventer told Green Markets. “The Unity partnership fits this strategy. AMS also fits this strategy of offering our customers functional fluids like anti-freeze, coolants, lubricants, and DEF and adding to the portfolio with crop input products.”
The Henry facility, which Unity purchased from United Suppliers Inc. in 2017 (GM Sept. 22, 2017), currently produces granular, turf grade, and spray grade ammonium sulfate products ranging from 90 to 300 SGN. Production at the facility began in January 2018, and some $20 million in recently announced upgrades (GM Feb. 15, p. 1) will help bring it to full operational capacity of 165,000 st/y, said Kobus van der Zel, Chief Operating Officer at Unity.
When the facility was purchased by Unity in 2017, United Suppliers had a 100 percent offtake agreement with Unity for the ammonium sulfate produced at the site. Van der Zel said that agreement still exists with Winfield United, which acquired United Suppliers’ crop nutrient business as part of a two-step merger announced in 2015 between United Suppliers and Land O’Lakes, the parent company of Winfield United (GM July 6, 2015).
Van der Zel said that offtake agreement is now transitioning from Winfield to Old World, however. “The majority of our product is going to Old World already and has been for about a month, but there are some transition agreements,” he told Green Markets. “We still supply Winfield with some product as they need it, but this new offtake agreement will eventually replace the offtake agreement with Winfield United as the transition is completed.”
Old World Industries has more than 56 distribution locations across the U.S., and Vanderventer said the company plans to sell and distribute the ammonium sulfate from Unity via truck, railcar, and barge mainly across the Cornbelt, but also into market “that best fit logistically and economically.”
“Our agreement is a multi-year agreement with growth opportunities,” Vanderventer said.