Dry Fertilizer Barge Rates
| 9/15/2023 | Last Week | |
| Memphis | 18.50-19.00 | 18.50-19.00 |
| St. Louis | 20.00 | 20.00 |
| Peoria | 27.00-28.50 | 27.00-28.50 |
| Cincinnati | 30.00 | 30.00 |
| St. Paul | 33.00 | 33.00 |
| Catoosa/Inola | 36.00 | 36.00 |
All Posts from September 15, 2023
OCI Outlines Green Ammonia Plans at Beaumont; Green Methanol Capacity to Double in the US
OCI Global on Sept. 15announced an agreement to offtake green hydrogen from New Fortress Energy Inc.’s (NFE) hydrogen business ZeroParks from its plant in Texas, beginning in 2025. The agreement will allow OCI Global to significantly scale up green ammonia production capacity to approximately 160,000 mt/y in Beaumont, Texas.
The agreement follows a 100-megawatt (MW) electrolyzer system order from Electric Hydrogen Co. (EH2) announced by NFE on Sept. 12. The green hydrogen will be produced by ZeroParks, using proton exchange membrane (PEM) technology and delivered to OCI’s facilities in Beaumont, where it will then be converted into green ammonia.
NFE’s first green hydrogen project, ZeroPark I, will come online in two phases. The first phase in 2025 will allow OCI to produce approximately 80,000 mt/y of green ammonia, and the second in 2026 will double OCI’s production capacity to 160,000 mt/y.
OCI produced its first tons of hydrogen-based green ammonia earlier this year at its Egypt Green facility, which is owned by Fertiglobe, a strategic partnership between OCI Global and ADNOC. OCI said the new plans complement its large-scale blue ammonia project in Texas, in partnership with Linde plc, which is scheduled to begin production in 2025 (GM Feb. 10, p. 1).
OCI also announced on Sept. 13 that it plans to double its green methanol production capacity to approximately 400,000 mt/y at its facility in Beaumont. Green methanol will come from a mix of renewable feedstocks, including renewable natural gas (RNG), green hydrogen, and other over-the-fence feedstock partnerships.
“Today’s announcement cements OCI’s position as the leading green methanol producer globally,” said OCI Global CEO Ahmed El-Hoshy. “It also represents another milestone in our decarbonization journey as a business, and our commitment to driving the energy transition.”
He added that it is clear that both methanol and ammonia will need to play an integral role to reach the IMO’s revised targets and he said OCI stands ready to supply them.
The scale-up plans include entering into supply agreements for renewable natural gas (RNG) exceeding 15,000 mmBtu per day, as well as securing the waste and development rights from the City of Beaumont. This is OCI’s first upstream RNG production facility and production is slated to start in first-quarter 2025. OCI also expects to produce green hydrogen-based e-methanol for the first time.
Methanol offtakers include the road fuels market, where it is used as a fuel-blend to reduce emissions; as a building block in a range of industrial applications; and most recently, as a fuel for shipping.
OCI has projected growth in incremental demand in the green methanol market of more than 6 million mt/y by 2028, due to the adoption of green methanol as a shipping fuel, based on the 225 dual-fueled methanol vessels now on order.
This summer, the first-ever green methanol container vessel, owned by AP Moller Maersk, was fueled with OCI HyFuels green methanol on its maiden voyage from Korea to Copenhagen. The company also announced last month a new agreement with Xpress Feeder Lines to supply their green methanol ships at the Port of Rotterdam from 2025.
“We continue to see more and more realization that methanol is the transportation sector’s most viable solution and the easiest way to transport and use renewable hydrogen today,” said Bashir Lebada, CEO, OCI Methanol/HyFuels.
“It is a solution that is available now and our focus is on continuing to scale technologies, whether through our projects or our supply partners, to ensure that our capacities continue to grow alongside demand,” Lebada added. “We are seeing increasing pull from road fuel markets due to the delay in EV adoption and charging station build-out, and while marine demand has been growing at a very fast pace, we have yet to see the impact of retrofits which should end up being a larger segment than new-builds.”
CF, POSCO Evaluate Clean Ammonia Project, Offtake
CF Industries Holdings Inc. and POSCO Holdings Inc., a South Korean steelmaker, energy trader, and power generator, announced on Sept. 14 that they are evaluating a joint venture to construct a low-carbon clean ammonia plant at CF’s Blue Point Complex in Ascension Parish, La., along with long-term, low-carbon clean ammonia offtake into South Korea.
CF and POSCO will initiate a front-end engineering and design (FEED) study on autothermal reforming (ATR) ammonia production technology. The FEED study is expected to be completed in the second half of 2024, with a final investment decision by CF and POSCO to follow. The proposed facility would cost approximately $2 billion.
ATR technology, when combined with carbon capture and sequestration (CCS), is expected to reduce carbon dioxide (CO2) emissions from the ammonia production process by more than 90% compared to conventional ammonia plants without CCS, enabling the resulting low-carbon clean ammonia to comply with the South Korean government’s Clean Hydrogen Energy Portfolio Standard.
If the project advances, POSCO expects to import low-carbon clean ammonia from the facility to South Korea to support decarbonization of POSCO’s own and third-party coal-based power generation facilities. Additionally, POSCO intends to convert low-carbon clean ammonia into hydrogen in order to use low-carbon hydrogen in gas-based power plants and in the steelmaking process.
“We are pleased to collaborate with POSCO to support both their decarbonization goals as well as those of South Korea,” said Tony Will, CF President and CEO. “POSCO’s concrete plans to use low-carbon ammonia to accelerate decarbonization in steel manufacturing and power generation in South Korea represent significant new demand for low-carbon ammonia as a clean energy source. We look forward to leveraging our two companies’ industry-leading expertise to advance our shared commitment to a more sustainable future.”
“The United States is one of the key strategic regions for POSCO Group as it is actively pursuing the establishment of an economically and reliably overseas hydrogen and ammonia supply network through the IRA support policy,” said Yoo Byeong-ok, POSCO Chief Green Materials & Energy Business Officer. “We plan to establish a production hub for clean ammonia in the United States in collaboration with CF Industries, the largest ammonia producer, and secure a stable supply network to timely provide clean hydrogen necessary for domestic power generation and hydrogen reduction steelmaking.”
Since 2020, CF has advanced projects to decarbonize its ammonia production network and position the company to supply a substantial volume of low-carbon clean ammonia within the next few years. This includes leveraging CCS technologies at its giant Donaldsonville Complex in Louisiana, and also constructing North America’s first commercial-scale green ammonia capacity at the complex, enabling up to 20,000 mt/y of green ammonia production beginning in 2024.
CF has also commenced a FEED study with Mitsui & Co., Ltd. to construct a greenfield low-carbon clean ammonia facility utilizing steam methane reforming (SMR) ammonia technology along with CCS at the Blue Point Complex.
OCP Operations Unaffected by Moroccan Earthquake; No Damage Reported at Khemisset Project
OCP Group SA suffered no damage to any of its facilities or mining operations from the earthquake that hit Morocco on Sept. 8, according to media reports, and virtually no disruption to production. All personnel at the company’s facilities were reportedly safe.
The 6.8-magnitude quake occurred in the Al Haouz province in Morocco’s Atlas Mountains, killing approximately 3,000 people and injuring 5,530 more, according to the latest reports. Port operations at OCP’s Jorf Lasf port were initially impacted but were reported to have returned to normal earlier this week.
Isle of Man-based Emmerson Plc, which is developing the Khemisset potash project in northern Morocco, said the project site and the company’s support offices are located some distance from the earthquake zone and were not directly impacted, according to a Sept. 11 company statement. Emmerson reported that all of its employees are safe.
IPL Continues to Pursue Fertilizer Business Sale; Strength in Explosives Offset by Fertilizer Weakness
Incitec Pivot Ltd. (IPL) said it is continuing to pursue a potential sale of its fertilizer business, while the planned sale of its Waggaman, La., ammonia plant to CF Industries Holdings Inc. remains conditional on approval from the US antitrust regulator.
In a Sept. 11 statement, the Australian group said the sale process of its fertilizer business is progressing “in line with normal expectations for a transaction of this size and complexity.” The company cautioned that discussions are confidential and incomplete and there is no certainty that any agreement will be reached or that any sale transaction will occur.
IPL confirmed in mid-July that it had received several approaches for the potential acquisition of the fertilizer business, noting that its Board was considering a potential sale of the business alongside ongoing proposals to structurally separate Incitec Pivot Fertilisers and the Dyno Nobel explosives business (GM July 14, p. 1). Indonesia’s state-owned PT Pupuk Kalimantan Timur (Pupuk Kaltim) is believed to be the preferred bidder (GM Aug. 11, p. 1).
In this week’s statement, IPL said it remains hopeful that the US Federal Trade Commission’s regulatory review process of the Waggaman sale will conclude by the end of calendar 2023. The group reached an agreement in March for the sale of the plant, which has 800,000 mt/y of ammonia capacity, to CF for a total value of $1.675 billion (GM March 24, p. 1).
IPL said its global Dyno Nobel explosives business is performing better than expected versus guidance comments in its first-half 2023 results in May (GM May 19, p. 24), while the fertilizer business performance is running below expectations. Overall, the group’s financial performance remains broadly in line with the outlook provided in May, IPL said.
“Dyno Nobel Americas’ focus on price and cost discipline in the explosives business has favorably impacted margins in the second half of the year,” the group said.
IPL expects Incitec Pivot Fertilisers’ (IPF) earnings in the Distribution business to be at the lower end of the “usual range” of A$40-$60 million (approximately $25.7-$38.5 million at current exchange rates) in FY2023.
While the second half has seen an improvement in fertilizer demand, resulting in projected full-year sales volumes being substantially in line with the prior year, IPL said margins remain depressed as a result of selling products into a negatively trending market and farmers switching to lower-margin products.
IPL also expects lower full-year output at its Phosphate Hill plant in northern Queensland, citing maintenance work at its Mount Isa, Queensland, sulfuric acid plant. The group now sees production of 870,000-880,000 mt of ammonium phosphate in FY2023, down some 30,000 mt from the output guidance given in May.
IPL said the volume of sulfuric acid supplied to Phosphate Hill in the second half will be reduced due to maintenance work at the Mount Isa plant brought forward from FY2024. The work is expected to take approximately three weeks to complete.
IPL expects the FY2023 EBIT impact from the reduced ammonium phosphate production to be in the range of A$13-$15 million, including the cost of repairs. However, the group noted that bringing the repair work forward is expected to reduce maintenance costs by roughly A$4 million from what would have otherwise been incurred in FY2024.
IPL said gas supply volumes under its long-term agreement with Power Water Corp. (PWC) for the Phosphate Hill plant have been above the forecast provided by PWC in June (GM June 9, p. 25). IPL now expects the EBIT impact from sourcing shortfall gas for FY2023 to be at the lower end of the A$75-$90 million range advised at that time.
IPL said Waggaman is expected to achieve nameplate capacity of 800,000 mt/y of ammonia in FY2023 in line with guidance in the first-half results. IPL said the Moranbah ammonium nitrate plant in Queensland, part of the Dyno Nobel Asia Pacific business, has had strong performance to date and is expected to achieve 360,000-370,000 mt of production this fiscal year, some 30,000-40,000 mt ahead of previous guidance (GM May 19, p. 24).
Argentina-Brazil Group Wins Mendoza Potash Bid; Hopes to Bring Fertilizer to Market in 18 Months
Argentina’s Mendoza province awarded its giant potash project to local firm Cia. Minera Aguilar SA and its Brazilian partner ARG, according to Bloomberg.
The Aguilar-ARG bid prevailed from a shortlist of three groups, and the duo will invest roughly $1 billion over five years to complete the first phase of the Rio Colorado potash mine. The province announced a week earlier that it had narrowed the field to one, but at that point had not named the winner (GM Sept. 8, p. 1).
Mendoza will keep a 12% stake in the mine as well as collect annual royalty payments on the potash produced, Governor Rodolfo Suarez posted on the social media platform now known as X.
Much of the fertilizer will be shipped to Brazil, Emilio Guinazu, who heads the province-owned firm that holds Rio Colorado, said in an interview before the announcement. Some of the potash will also stay in Argentina, itself a huge food supplier, reducing dependence on imports and volatile global markets.
The consortium will take over Rio Colorado a decade after Brazilian mining giant Vale SA withdrew from the project. While potash prices have come off the peaks they touched after Russia’s invasion of Ukraine, they are expected to stay at attractive levels, Guinazu said.
In a first phase, Rio Colorado will churn out as much as 1.4 million mt/y using road transport. Initially there will be a pilot plant to help the mine bring production to market within 18 months. A possible second phase would double capacity and shift to rail.
“We’ve achieved a significant feat in the economic history of the province,” Suarez said.
Aguilar is owned by Integra Capital, which is headed up by businessman Jose Luis Manzano, and has purchased oil, power, and lithium assets in recent years.
Mosaic Updates on Plant Outages, Performance
The Mosaic Co. on Sept. 12 reported that its Florida phosphate operations, which halted operations due to Hurricane Idalia, resumed production within three days. Daily production was put at approximately 20,000 mt.
In addition, an unexpected local utility power interruption in Louisiana at the end of August damaged Uncle Sam’s largest sulfuric acid plant. Repairs to the complex, which operates at a production rate of 15,000 mt/week of finished product, are anticipated to be completed by the end of October.
In the meantime, the company reported that July-August volumes were up from year-ago levels for all three major segments – Potash, Phosphates, and Mosaic Fertilizantes – while revenues were down.
Potash revenues took the biggest dive, falling 49.4% to $489 million from the year-ago $967 million. Volumes were up at 1.483 billion from 1.427 billion. Mosaic expects third-quarter potash sales volumes to be near the high end of previous guidance of 2.1-2.3 million mt, reflecting the impact of ongoing strong demand in North America. Potash price guidance remains unchanged at $250-$300/mt.
Phosphate revenues were off 33.5%, to $642 million from $966 million, while volumes were 1.081 million mt from 979,000 mt. Mosaic expects third-quarter volumes lifted to 1.081 million mt. As noted above, shipments were impacted by Hurricane Idalia and a power interruption. Third-quarter realized DAP prices on an FOB basis are expected to be in the previous guidance range of $475-$525/mt.
Mosaic Fertilizante’s revenues were off 35.7% for the two-month period, to $1.15 billion from the year-ago $1.788 billion, while sales volumes were up at 2.016 million mt from 1.891 million mt.
Asmark Institute – Management Brief
The Board of Directors of the Asmark Institute, Owensboro, Ky., a provider of risk management services and regulatory compliance products to the agricultural industry, announced on Sept. 11 a transition in its leadership team. Amber Duke, who has been a part of the organization since 2006 and served as President and CEO since 2019, has decided to embrace a new role as Asmark’s Vice President of Marketing & Communications.
“Transitioning to a new role is a decision I’ve made with great thought and consideration,” Duke said. “My dedication to the industry, the incredible Asmark team, and our clients remains unwavering and I am excited to continue contributing to the organization’s success in a fresh capacity. The role of Vice President of Marketing & Communications aligns perfectly with my professional aspirations and personal strengths and allows me to continue to support and enhance Asmark’s mission.”
“Amber’s enduring commitment to the industry, the Asmark team, and its valued clients remains steadfast, and her contributions have been instrumental to the organization’s growth and success,” said Billy Pirkle, Asmark Board Chair. “Her institutional knowledge, leadership abilities, and skillset have profoundly shaped the organization’s positive trajectory, and the entire Board and the staff stand united in our support of her decision. We are thrilled that she will continue to be a key leadership team member.”
The Board has named Brian Mason as the next President and CEO of Asmark, effective Oct. 1, 2023. He has been with Asmark since 2008 and assumed the position of Vice President and COO in 2019.
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All information has been obtained by Green Markets from sources believed to be reliable. However, because of the possibility of human or mechanical error by our sources, Green Markets or others, Green Markets does not guarantee the accuracy, adequacy, or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information.
For additional details visit our Terms of Use.