All Posts from October 13, 2023

ICL Business Activities Continue to Function After Attack; Concerns Raised Over Potash Supply

Egypt, Featured, Israel, Middle East, Natural Gas, News, Nitrogen, Potash

ICL Group Ltd. said its business activities continue to function following the deadly attack on Israel from Hamas, and that it remains committed to its customers from a business perspective “while acknowledging the toll of the circumstances on all involved,” as cited by a Dow Jones report.

ICL has production assets in southern areas of the country that have been affected by the recent events, but on Oct. 9 said there was no impact on its production or exports.

The Port of Ashdod, just 20 miles north of the Gaza Strip and a key hub for ICL’s potash exports, is in emergency mode as a result of the escalating conflict. This is putting as much as 3% of global potash supply at risk, according to Scotiabank analyst Ben Isaacson, as cited by a Bloomberg report.

ICL in August said it was targeting the production of 4.7 million mt of potash this year and was expecting its third- and fourth-quarter potash sales volumes to be “relatively similar” to the second quarter, when it sold 1.26 million mt (GM Aug. 11, p. 27).

Some freight insurers on Oct. 9 suspended coverage in Israel and Palestine on the transport of freight and on third-party civil liability policies following Israel’s declaration of war on Hamas, according to a notice from Grupo Raminatrans, an international logistics company.

Several fertilizer stocks saw significant jumps earlier in the week as Wall Street weighed the prospect of potash supply problems stemming from the Middle East crisis. Nutrien Ltd., the world’s biggest potash producer, rose as much as 4.2%, the most since July, according to Bloomberg.

CF Industries Holdings Inc., the leading nitrogen producer, gained as much as 6.2%, the most in a month. Mosaic Co. climbed as much as 6.7%, the stock’s biggest intraday gain in almost a year.

The potential involvement of Iran, a key Middle East exporter of nitrogen, could lead to a spike in nitrogen fertilizer prices due to limited supply and potential premiums in benchmark Dutch TTF natural gas, Isaacson warned.

TTF natural gas futures reached their highest level since mid-June after Israel on Oct. 8 ordered the shutdown of the Tamar gas field in the Mediterranean Sea, citing safety concerns amid the escalating conflict. Halting the Tamar field resulted in a roughly 20% reduction of Israel’s gas shipments to Egypt, according to Bloomberg.

So far, the larger Leviathan gas field, which also supplies gas to Egypt, is continuing to operate. Should Leviathan keep operating at normal rates and output is ramped up at the Karish field, Israeli gas should continue to flow to Egypt, Bloomberg reported, citing Energy Aspects Ltd. analyst Leo Kabouche.

Kabouche said the key unknown is the duration of the outage, adding that Israeli gas is critical to feedgas availability in Egypt given the slide in domestic production there.

There already are concerns that the halt in supplies from Tamar will further impact Egypt’s ability to export LNG. Egypt’s oil minister said last week that the country will resume exports of LNG this month following a break over the summer. But the stoppage at Tamar could result in lower shipments to buyers in Europe, who are increasingly reliant on alternatives to Russian natural gas.

Iran’s possible involvement in the conflict could also endanger movement of vessels though the Strait of Hormuz, through which one third of traded liquefied natural gas passes, Kabouche said.

Kenyan Green Ammonia Plant in Start-Up Mode; Iowa Facility Planned with Landus Cooperative

Africa, Featured, Green Ammonia, Hydrogen, News, Russia, U.S.

The world’s first commercial modular green ammonia plant is starting up in Kenya and the company behind the technology plans to deploy the facilities as far away as Iowa’s Landus Cooperative in Des Moines, according to a Bloomberg report. 

The Kenyan plant, which was designed and will be run by US-based Talus Renewables, Austin, is sited near Naivasha just outside Kenya’s capital, Nairobi. Under a 15-year offtake agreement, Talus will supply Kenya Nut Co. Ltd., which grows a variety of crops.  

It uses electricity, which in Kenya Nut’s case will be supplied from an onsite solar farm, to split water atoms, freeing up hydrogen to be mixed with nitrogen to create the fertilizer. By doing so it removes the need for the fertilizer to be imported from countries like Russia, cutting costs, securing supply, and reducing emissions of climate-warming gases. 

“The average bag of fertilizer in sub-Saharan Africa travels 10,000 kilometers,” Hiro Iwanaga, Talus’ Founder, said in an interview. With this plant “you can locally produce a critical raw material, carbon free,” he said.

While the plant at Kenya Nut is small, producing 1 mt/d of fertilizer, the company plans to eventually have Talus produce 200 mt/d from larger plants on its sites to supply 95% of its needs, said Graeme Rust, Kenya Nut’s CEO.

The plants currently come in two sizes, the one deployed at Kenya Nut and a 10 mt/d facility. The larger ones need about 11.5 megawatts of power. Iwanaga said the company is currently raising money in a funding round and plans a larger one next year, which will include securing project finance.

Talus also reported that it has an agreement with Landus Cooperative. Landus lists Talus as one of the cooperative’s Innovation Connector Partners for the 2023 season.

“The green ammonia that Talus’s systems produce is both reliable and locally produced, which reduces costs by addressing supply chain insecurity and challenges,” said Matt Carstens, Landus CEO and President. He added that green ammonia is “an exciting innovation to consider.”

Talus is seeking to set up its plants in a number of locations across Africa such as sugar plantations. It also plans to work with mining companies to make the ammonia used in blasting. 

Talus reports that representatives from Yara Africa & Asia, USDA, and the US Agency for International Development were recently onsite at the Kenyan plant. “We had the chance to show off our technology and talk about the unprecedented opportunity it presents for difficult-to-decarbonize industries like agriculture,” Talus said.

IFC Green Loan to Fund Solar Plants for OCP Low-Carbon Fertilizer Production

Carbon, Featured, Morocco, News, North Africa

The International Finance Corp. and Morocco’s OCP Group on Oct. 10 announced a green loan to fund construction of solar power plants to produce low-carbon fertilizer. IFC will provide OCP with a €100 million green loan towards the €360 million construction of two solar power plants that will provide clean energy to its operations in the Moroccan mining towns of Benguerir and Khouribga.

The plants will have a combined capacity of 400 megawatts peak (MWp) and up to 100 megawatt hours (MWh) of battery storage, making this the first large scale solar photovoltaic project with integrated storage infrastructure in Morocco, and the largest in North Africa. The power generated by the plants will be environmentally friendly with zero carbon emissions, and more cost-effective than grid electricity during both daytime and evening peak periods.

A green loan is a form of financing for eligible projects that contribute to environmental objectives such as climate change mitigation or adaptation.

“Today’s agreement is a major milestone towards our target of using 100% renewable energy in our fertilizer production by 2027,” said OCP Group Chairman and CEO Mostafa Terrab. “Our deepening collaboration with IFC reflects our alignment on the urgency of addressing the global challenges of food security and climate change simultaneously.”

The announcement marks IFC’s second green loan to OCP this year. In April, as part of the first phase of OCP’s 1.2 gigawatts peak (GWp) solar program, IFC provided a €100 million loan for the construction of four solar power plants, also in Benguerir and Khouribga, for a combined capacity of 202 MWp.

OCP’s solar program is implemented by OCP Green Energy SA, a wholly owned subsidiary of OCP created in 2022 to develop the company’s renewable energy generation activities. It is part of OCP’s $13 billion Green Investment Program.

The program will also leverage the expertise of INNOVX, a multi-sectorial venture platform launched by Mohammed VI Polytechnic University (UM6P) that is dedicated to building innovative and sustainable businesses and ecosystems with a strong local impact.

IFC said the project aligns with its Global Food Security Platform, a $6 billion financing facility launched in 2022 to strengthen the private sector’s ability to respond to the food crisis and help support the sustainable production of food.

Emergency Cited for Fatal Tanker Crash

Ammonia, News, News Briefs, Texas, U.S.

A medical emergency involving the driver of a tanker truck carrying anhydrous ammonia was reported to be the cause of a fatal Oct. 10 accident on Interstate 10 near Willcox, Ariz., according to the Arizona Department of Public Safety (ADPS).

The ADPS said the emergency caused the tanker truck to drift out of the westbound lanes, cross a dirt median, and hit a box truck head on. The driver of the box truck sustained life-threatening injuries and his passenger, who was in a sleeper berth, was killed. The driver of the tanker truck sustained minor injuries.

A very small amount of anhydrous ammonia was leaking after the collision. The remaining amount of the liquid was transferred to another tanker.

The owner of the tractor-trailer carrying the ammonia was Kimrad Transport, Amarillo, Texas, according to ADPS.

FuelPositive Awarded C$1.9 M in Government Funding for Green NH3 System

Ammonia, Canada, Featured, Green Ammonia, Hydrogen

Clean technology developer FuelPositive Corp., Waterloo, Ont., on Oct. 10 announced that it will receive a funding grant of up to C$1.9 million through the Research and Innovation Stream of the Agriculture Clean Technology (ACT) Program, delivered by Agriculture and Agri-Food Canada (AAFC).

AAFC has made the commitment to FuelPositive’s “Green NH3 Demonstration Phase Project” in support of the commercialization of the FP300 Green Ammonia system.

“This funding will accelerate getting the FP300 system to market,” said Jeanne Milne, FuelPositive’s Senior Government Relations Advisor. “Our iterative technological approach allows FuelPositive to adapt to meet farmers’ needs. The Government of Canada’s vote of confidence is a testament to our shared dedication and commitment to make agriculture cleaner and Canada healthier.”

The Green Ammonia Demonstration Phase consists of building and testing three demonstration systems. The FP300 on-farm, containerized green ammonia plants produce 300 kg per day, or more than 100 mt/y, of anhydrous ammonia. The company plans to deliver the first batch of commercial systems beginning in 2024 (GM June 2, p. 26).

FuelPositive’s decentralized Green Ammonia system consists of a nitrogen generator to produce nitrogen from the air, an electrolyzer to produce hydrogen and oxygen from water, and a patent-pending Green Ammonia synthesis converter that operates with sustainable sources of electricity, eliminating the need for fossil fuels.

Schuyler Coop Completes $7 M Project

News, News Briefs, Nitrogen, U.S.

Nebraska’s Schuyler Cooperative Association reported that it has completed its $7 million new dry fertilizer facility in Richland, Neb. Cooperative members got to see the new facility at an open house at the annual fish fry last month.

Schuyler told The Columbus Telegram that the new facility is “cutting edge” and will allow it to add biologicals, nitrogen inhibitors, and phosphate impregnation to its offerings, with a better blending system for both truck and rail pickups. Automation will allow the facility to be a two-man operation.

Schuyler will retain its older 2,000 st facility, with combined storage now put at some 10,000 st. Schuyler noted that the facility was already paid for and its addition should have no negative impact on dividends going forward.

GROWMARK Completes Move to New Headquarters

News, News Briefs

GROWMARK said on Oct. 12 that it recently completed its move to a new corporate headquarters located at 1705 Towanda Avenue in Bloomington, Ill. The cooperative purchased the building from COUNTRY Financial a little more than a year-ago. A ribbon-cutting ceremony is planned with the McLean County Chamber of Commerce for Oct. 17.

GROWMARK employs around 498 employees at the Bloomington office.

Russia Mulls Increasing Fertilizer Export Quota

News, News Briefs, Nitrogen, Russia

Russia may increase the export quota for fertilizers in place for June 1-Nov. 30, 2023, raising the quota by 2.2 million mt, to more than 18.5 million mt, according to an Interfax report this week, citing a draft government resolution.

Russia’s Industry and Trade Ministry has drawn up the draft resolution after calculating the additional quota based on the latest data on production, inventories, and supplies of fertilizers. The additional quota reflects the amount not needed on the Russian domestic market.

The Russian government first introduced quotas for the export of nitrogen and complex fertilizers on Dec. 1, 2021, as one of the measures to ensure the domestic market had sufficient supply of fertilizers (GM Nov. 5, 2021).

The export restrictions have been extended several times over the intervening period. In May Russia green-lighted an extension of quotas on the export of nitrogen fertilizers and certain other fertilizer products for the June 1-Nov. 30 period (GM June 2, p. 1). A total export quota of more than 16.3 million mt was set at that time.

Russian Ferts Railed for Export Up in September

China, Europe, India, Latin America, News, News Briefs, Russia, Switzerland, Transportation

The volume of fertilizers transported by rail for export from Russia totaled some 3.06 million mt in September, marking a 23% increase on the 2.5 million mt in September last year, according to an Interfax report, citing data from Russian Railways.

September volumes were little changed from August this year, however, when 3.04 million mt were transported by rail for export.

Rail Volumes for Export by Destination (‘000 mt)

Destination Sept 2023 Aug 2023 % change
Latin America 1,433 1,323 +8
China & Hong Kong 276 200 +18
India 179 200 (10)
EU 258 271 (5)
Switzerland 712 744 (4)
CIS 106 137 (23)

Transit volumes transported by rail in September were significantly higher year-over-year, at 1.02 million mt versus 329,000 mt a year ago. Transit volumes in August totaled 884,000 mt.

Potash volumes transported by rail for export from Russia totaled 1.01 million mt in September, while nitrogen fertilizer volumes amounted to 1.11 million mt. Phosphate and complex fertilizers volumes totaled 872,000 mt, according to the report.

In the first nine months of 2023, 24.45 million mt of fertilizers were transported by rail for export, a 5% increase from last year when 23.27 million mt were exported. Transit volumes were 7.14 million mt for the nine months, up from 2.17 million mt last year, according to the report.

Acron to Increase CN Production Capacity

Africa, Calcium Nitrate, India, Latin America, Mexico, News, News Briefs, Russia, Southeast Asia

Acron Group is expanding and upgrading the granulated calcium nitrate (CN) capacity at its Veliky Novgorod site in northwest Russia, which on completion will take its aggregate CN production capacity to 270,000 mt/y from the current 100,000 mt/y.

Acron reported on Oct. 9 that it is increasing capacity at the existing CN unit to 135,000 mt/y, from the current nameplate 100,000 mt/y. Acron in July said the unit has been exceeding its design capacity since the beginning of 2023 (GM July 14, p. 28). The facility, Acron’s first CN production plant, was commissioned in 2022 (GM Aug. 12, 2022).

A second CN production unit, also with 135,000 mt/y capacity, is already under construction and is scheduled to be commissioned by the end of 2024. Acron uses liquid CN, a byproduct of apatite concentrate processing at the group’s NPK plants, as the feedstock for the new product, according to a company statement in July.

Acron produced 45,000 mt of CN in the first six months of this year (GM July 21, p. 28). The group said in its Oct. 9 press release that since the commissioning of the first CN unit, it has supplied more than 80,000 mt of CN to customers in Russia, Latin America (including Brazil and Mexico), Africa, India, Southeast Asia, and the CIS. The CN is shipped in 25-kg bags and larger bags of various volumes.

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