All Posts from June 17, 2013

TradeMark Nitrogen celebrates 30th anniversary

News, News Briefs

Tampa — TradeMark Nitrogen, a manufacturer of liquid nitrogen products based in Tampa, Fla., is celebrating its 30th anniversary this year. “In any business, 30 years is a significant accomplishment, but this is a story that’s about much more than longevity,” said Rick Brandt, Trademark CEO. “This is a story about continuing to keep your eye on the market and evolving to delight your customers.” Formed in March 1983, TradeMark produces ammonium nitrate and magnesium nitrate solutions, with plans to expand into manganese and zinc solutions. The company’s roots go back to Southern Nitrogen Company, which was formed in 1954 and later merged with Kaiser Aluminum and Chemical Corporation in 1966. TradeMark Nitrogen Corporation was spun from Kaiser as an independent company in 1983. “You don’t last 30 years without staying in touch with your customers,” said Mike Barry, president of TradeMark Nitrogen. “We have to continue to look for new opportunities, questioning the status quo and looking for areas to improve our business activities.” TradeMark will mark its 30th with a commemorative paint scheme on the TMN #31 car at the NASCAR Nationwide Series race on July 5 in Daytona, Fla.

One killed in CF accident

Breaking Industry News

One worker was killed and seven others injured in an incident that occurred at CF Industries Holdings Inc.’s Donaldsonville, La., nitrogen complex around 6:00 p.m., Friday, June 14. The accident occurred in a section of the plant that had been shut down for maintenance.

Killed was Ronald “Rocky” Morris Jr., a 34-year employee of the company.

Seven others were injured, including four CF employees–Courtney Julien, Melvin Singleton, Jeramy Worsham and Kade Yarbrough. Three contractor employees were also injured. As of June 15, one employee remained hospitalized and the others had been treated and released.

CF said the incident involved the rupture of a nitrogen distribution header during the off-loading of nitrogen. There was no fire or chemical release nor was there any threat or hazard posed to the community.

Yara postpones Belle Plaine expansion project

Featured, News

Yara International ASA announced on June 14 that it is postponing the planned expansion project at its production plant in Belle Plaine, Canada. Yara views the Belle Plaine site in Saskatchewan as an optimal location for a future North American nitrogen expansion, but will spend more time evaluating construction cost development and other key project parameters.

“We are not ready to initiate a Belle Plaine expansion today, primarily due to recent increases in construction cost both in Canada and North America generally,” said Jørgen Ole Haslestad, Yara president and CEO. “There is also a significant risk of future nitrogen over-supply in North America as new project initiatives are announced, despite deteriorating project profitability.”

The Yara Belle Plaine facility has current production capacity of 0.7 million mt/y of ammonia and 1.2 million mt/y tons of urea and UAN. The planned expansion project comprised an integrated world scale ammonia and urea line that would have added approximately 1.3 million mt/y of urea capacity.

“Yara’s growth options remain significant, including a number of opportunities for profitable investments in value-added product capacity, downstream facilities and plant de-bottlenecking projects,” said Haslestad. “We also expect to find profitable commodity nitrogen growth opportunities going forward, and a future Belle Plaine expansion remains an option for Yara when the construction cost situation improves.”

Yara’s announcement follows Agrium Inc’s decision in early June to suspend engineering development on its proposed $3 billion nitrogen greenfield project in the U.S. Cornbelt (GM June 10, p. 1). Agrium stressed that its project, which would produce roughly 1.8 million mt/y of primarily urea and UAN, was still on the company’s radar, but it had decided instead to focus on efforts to secure a strategic partner and a gas contract for the project at this time.

Yara first announced its Belle Plaine expansion plans in February 2012 (GM Feb. 13, 2013), and reported a year ago that the project had been approved for a fast-track process (GM June 18, 2012). The company said then that the expansion, which was to be located next to the existing plant on Yara’s 660-acre Belle Plaine site, was expected to be online by the second half of 2016, with construction starting in 2013. No projected costs for the project were divulged.

At present, the site has one ammonia plant, one nitric acid plant, and one urea granulation plant. Yara celebrated the facility’s 20th anniversary last October, and said last year that the existing ammonia-urea plant had been expanded and upgraded several times and had reached its maximum capacity.

The expansion would have added two granulation units to produce urea and urea-plus-sulfur, the latter of which Yara currently markets in Europe but said would be a good fit for the canola crop segment in Western Canada and the upper Midwest.

Green Markets has updated its Global Nitrogen Supply & Demand Model to reflect the recent announcements. The fully customizable model provides detailed analysis, estimates, and forecast for the global nitrogen industry, and can be ordered by calling 1.603.357.8160.

Union threatens sanctions against ICL

News, News Briefs

Tel Aviv — The Dead Sea Works union is threatening to impose sanctions to back up a demand that management of Israel Chemicals Ltd. (ICL) grant workers better terms for revenue sharing. The union has put off a decision, but is threatening to take unspecified action against the management over the issue. On June 10 ICL management announced that it would distribute $45 million in profits to the company’s 11,300 workers in Israel and abroad for 2012. The company also laid out guidelines for profit sharing in the coming years. The Dead Sea Works union, the largest in ICL, charges that the terms of future distribution of profits would kick in only if the company has more than $4 billion in profits from 2012-2015. The union is demanding improved terms for profit sharing. In addition, the union is demanding a one-time grant of thousands of dollars per worker. Dead Sea Works union leader Edmond Lankri charged that senior management is being granted scandalous options packages at a time when the workers who are responsible for the company’s success will be given only a small part of the revenues. ICL management said in response that it is among the leading companies in Israel in benefits for workers and in revenue sharing. The statement added that the latest revenue sharing plan is on top of bonuses and other incentives that amount to thousands of dollars granted the company’s workers.

The Week in Fertilizer Stocks

Fertilizer Stocks

The Week in Fertilizer Stocks

Producer Symbol Price Week Ago Year Ago
Agrium AGU 89.89 90.55 81.21
CF Industries CF 185.64 192.88 164.14
CVR Partners UAN 23.19 24.26 20.36
Intrepid Potash IPI 19.00 18.86 20.36
Mosaic MOS 58.70 60.03 47.49
PotashCorp* POT 40.78 41.52 38.02
Rentech Nitrogen RNF 29.20 31.30 23.61
Terra Nitrogen TNH 205.25 205.25 183.87
Distribution/Retail
Andersons Inc. ANDE 53.29 52.22 41.98
Deere & Co. DE 85.60 86.09 73.27
Scotts SMG 47.81 45.91 40.21
* represents three-for-one stock split

PotashCorp responds to EPA penalty

News, News Briefs

Geismar, La. — In response to an earlier report by the U.S. Environmental Protection Agency (GM June 10, p. 12), Potash Corp. of Saskatchewan Inc. acknowledges that PCS Nitrogen Fertilizer LP has agreed to pay a penalty of $198,825 for an alleged violation of the Clean Air Act at its Geismar, La., phosphoric acid facility. In addition to the fine, the company will make process changes to the site to address EPA’s concerns. The changes will be completed by the end of 2013 at an estimated cost of $105,000. However, PotashCorp does not believe either the fine or modifications are warranted, saying it chose to settle the matter rather than pursue litigation. PotashCorp said it is unable to confirm the government’s statement about the amount of hydrogen fluoride (HF) that will be controlled by the settlement. It said the statement appears to be based on a misunderstanding of the company’s processes. Before the process changes being implemented as a result of the settlement, the amount of HF that could have gone from the scrubbers to the cooling tower was much lower than the amount the government suggests will be controlled by the settlement. PotashCorp said it is committed to environmental compliance at all of its facilities and continually makes significant investments to ensure its sites meet or exceed all air and water quality standards. The company said recent investments at the Geismar facility are reducing greenhouse gas emissions by about 1 million mt/y. Each year the company sets specific environmental and safety goals to ensure continuous progress in these areas. It said these goals, and the resulting performance toward achieving them, are reported publicly each year.

Marubeni revises Gavilon deal, excludes energy

News, News Briefs

Tokyo — Marubeni Corp., the Japanese trading company that agreed last year to buy Omaha-based Gavilon Holdings LLC, reported on June 10 that a new agreement has been reached whereby Gavilon’s energy business will be excluded from the deal and Marubeni will pay $1 billion less than the original sum. Marubeni said in May 2012 (GM June 4, 2012) that it would pay $3.6 billion for Gavilon plus additional debt in a deal that was expected to close by the fall, pending regulatory approvals. Under the revised agreement, Marubeni will pay $2.6 billion for all of Gavilon minus its energy unit. At the time of the initial deal, Marubeni touted the acquisition of Gavilon’s grain and fertilizer assets, saying both businesses would further its competitiveness in the global grain and fertilizer trade. Marubeni said little about what advantages the energy business would bring, however, saying only that Gavilon’s energy sector deals “mainly in crude oil, natural gas, and fuels, which is operated through a vast logistics network that includes 8 million barrels of crude oil storage capacity, 10 billion cubic feet of natural gas storage capacity, and 500,000 barrels of refined products storage capacity.” Marbubeni said last week that it has received the necessary approvals for the deal from all relevant competition authorities. China’s regulatory authority has granted conditional approval, however, and Marubeni said it is “currently in the process of fulfilling those conditions.” Chinese authorities said in April that their approval hinged on Marubeni and Gavilon continuing to sell soy to China as separate companies with no interchange of market intelligence. Gavilon has some 2,000 employees, and past investors included Ospraie Management, George Soros’ Soros Fund Management LLC, and Orascom Construction Industries (OCI). OCI confirmed last year that it sold its 16.8 percent stake in Gavilon Group LLC to Marubeni for $604.8 million, and would use the proceeds in part to finance its Fertilizer Group expansion in North America.

Illinois issues citations for 8,000-gallon NH3 leak

News, News Briefs

Winnebago, Ill. — The Illinois Environmental Protection Agency (IEPA) is investigating the June 4 release of 8,000 gallons of anhydrous ammonia from a storage tank at Conserv FS in Winnebago County in northern Illinois. The release reportedly went on for 12 hours after a tanker truck owned by Schoff Farm Service Inc. (SFS) hit a valve on an ammonia loading rack at the Conserv FS facility near Winnebago, Ill. Authorities said emergency responders issued an advisory to local residents to shelter in place, while firefighters used about 100,000 gallons of water to control the spread of the ammonia cloud. A specialized hazardous materials response team in Level A protective suits worked into the early morning on June 5 to try to stop the leak. “They weren’t able to completely stop the release, but they got it slowed to the point it wasn’t releasing nearly as rapidly,” Win-Bur-Sew Fire District Chief Don Crawford told Green Markets. “We are guessing about 8,000 gallons were in a 26,000 gallon storage tank, which was approximately 30 percent full.” Crawford said no evacuations were necessary, but residents downwind from the scene were advised to stay inside and keep their doors and windows closed. IEPA has issued citations against Conserv FS and SFS for several violations of the Illinois Pollution Control Board regulations and the Illinois Environmental Protection Act, and has also asked the Illinois Attorney General’s Office to obtain a court order that would require both companies to contain and remove ammonia-impacted waters and soils that continue to pose a threat of water pollution; review the design and safety features of chemical storage and loading/unloading areas for deficiencies that could lead to future releases; and implement additional corrective and remediation measures as determined appropriate. Crawford reported that there was minimal dispersal of the vapor cloud beyond the farm service plant, but ammonia-contaminated water did flow into a nearby Kent Creek and caused a fish kill in a private pond downstream from the plant. Local reports said Conserv built makeshift dams on June 5 to try to contain any remaining water on the site, and also installed an aerator in the pond to help dissipate ammonia.

FEMA to withhold additional aid to West, Texas

News, News Briefs

West, Texas — Texas Gov. Rick Perry’s office reported last week that the Federal Emergency Management Agency (FEMA) has denied additional federal aid to West, Texas, following the April 17 explosion at the West Fertilizer facility that killed 15 and caused an estimated $100 million in property losses to homes and businesses in the town. FEMA has reportedly provided more than $7 million in federal funds directly to families affected by the disaster, as well as emergency housing assistance, and is also paying 75 percent of the cost of debris removal. According to reports, FEMA informed the governor’s office that it was withholding additional aid because the damage in West “is not of the severity and magnitude that warrants a major disaster declaration.” Perry issued a statement saying he was disappointed by the decision. “The day of the West memorial service, President Obama stood in front of a grieving community and told them they would not be forgotten,” Perry said. “He said his administration would stand with them, ready to help. We anticipate the president will hold true to his word and help us work with FEMA to ensure much-needed assistance reaches the community of West.” West officials have said some $57 million in assistance is needed to complete repairs, including $40 million to rebuild devastated schools near the blast.

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