All Posts from October 18, 2019

Intrepid Potash Inc. – Management Brief

Management Briefs, Specialty

Intrepid Potash Inc., Denver, Colo., announced on Oct. 16 that Joseph Montoya, current Vice President and Chief Accounting Officer, will be resigning from Intrepid on Nov. 9 to pursue another career opportunity. Intrepid also announced the appointment of Matt Preston to Vice President of Finance, effective Nov. 10. Preston will serve as Intrepid’s principal financial officer and principal accounting officer, roles that Montoya currently occupies. Preston currently serves as Intrepid’s Director of Budget and Forecast, while also leading its investor relations function.

“Since joining Intrepid soon after our IPO in 2008, Matt has assumed successively senior roles on our finance and accounting team,” said Bob Jornayvaz, Intrepid’s Executive Chairman, President, and CEO. “Throughout Matt’s tenure over the last 11 years, he has worked very closely with our senior operations and sales staffs, which makes him uniquely qualified for this role. Matt’s most recent role serving as the lead of our financial planning and analysis team and our investor relations function, and his comprehensive knowledge of the day-to-day operations at all our facilities and our long-term strategic plans, have prepared him for success as our new VP of Finance. We thank Joseph for his work at Intrepid and wish him the best of luck in his new opportunity.”

MKC Signs LOI to Acquire Mid-West Fertilizer

News, News Briefs, Southern Plains

MKC, Moundridge, Kan., has entered into a letter of intent to acquire Mid-West Fertilizer Inc., a full-service agricultural retailer headquartered in Paola, Kan., the companies announced on Oct. 15. The acquisition is expected to be completed in early 2020, and will include Mid-West’s grain, wholesale and retail agronomy, energy, feed, and trucking operations.

“Together, we have identified benefits and opportunities we can gain by combining the organizations, which will allow our companies to continue to achieve more success,” said Dave Christiansen, MKC President and CEO.

The two companies are currently completing the required legal documents and due diligence necessary to finalize the transaction. Just how the merger will be structured was not disclosed, but the announcement said Rod Silver, current President and CEO of Mid-West, will continue to lead Mid-West after the acquisition.

Silver said combining the two organizations will provide efficiencies in current operations and opportunities to expand services to producers within the combined territory, and will increase the company’s relevance in the industry. MKC and Mid-West already have a working relationship, having collaborated for three years through Team Marketing Alliance LLC, a majority-owned subsidiary of MKC that offers grain marketing services to Kansas co-ops.

“As our company enters into 40 years of existence, this is the right transition for our customers, employees, and company,” Silver said. “When we looked to the future, it was important to partner with an organization that would bring value to producers, provide our employees [with] career development opportunities, and allows our organization the opportunity to continue to be successful. MKC is the right partner to make that happen.”

Mid-West was founded in 1980, and has 155 employees and 25 locations in Kansas, Arkansas, Oklahoma, and Missouri. In addition to its wholesale fertilizer business, which would be a new venture for MKC, Mid-West also provides regional growers with grain handling services, custom application, crop nutrients, crop protection products, seed, feed, fuels, lubricants, propane, and trucking and tire sales.

MKC is a full-service farm co-op with more than 40 locations in central Kansas specializing in grain, agronomy, energy, feed, and risk management products and services. The company was founded in 1965, and currently has more than 375 employees serving nearly 10,000 members.

MKC has been expanding in 2019. In early June, the company completed a merger with Plains Equity Exchange and Cooperative Union, headquartered in Plains, Kan. The unification plan was approved by both boards in February, with 95 percent of Plains Equity members supporting the merger in an April vote.

“Both boards felt strongly that unification would bring value to the members and employees of Plains Equity, and the results of the Plains Equity vote reaffirms this,” Allen Wegner, MKC Board Chairman, said in April. “MKC has proven to show value to members through unification by delivering quality products and services, innovation, growth, and profitability.”

California EPA to Ban Chlorpyrifos in 2020

California, News, News Briefs

The California Environmental Protection Agency announced on Oct. 9 that virtually all use of the pesticide chlorpyrifos in California will end next year following an agreement between the Department of Pesticide Regulation (DPR) and pesticide manufacturers to withdraw their products.

“For years, environmental justice advocates have fought to get the harmful pesticide chlorpyrifos out of our communities,” said Governor Gavin Newsom. “Thanks to their tenacity and the work of countless others, this will now occur faster than originally envisioned. This is a big win for children, workers, and public health in California.”

The agreement with Dow AgroSciences and other companies means that use of chlorpyrifos will end sooner than anticipated in California had the companies pursued administrative hearings and potential appeals processes, which could have taken up to two years. To ensure consistency for growers and for enforcement purposes, DPR said it is applying the terms and deadlines to seven other companies that are not part of the settlement agreement but are subject to DPR’s cancellation orders.

Under terms of the settlement, the companies agreed that all sales of chlorpyrifos products to growers in California will end on Feb. 6, 2020, and growers will no longer be allowed to possess or use chlorpyrifos products in California after Dec. 31, 2020. Until then, all uses must comply with existing restrictions, including a ban on aerial spraying, quarter-mile buffer zones, and limiting use to crop-pest combinations that lack alternatives. DPR said it will aggressively enforce these restrictions.

A few products that apply chlorpyrifos in granular form, representing less than one percent of agricultural use of chlorpyrifos in California, will be allowed to remain on the market. These products are not associated with detrimental health effects, but DPR said it will continue to monitor for any exposures associated with these products.

“The swift end to the sale of chlorpyrifos protects vulnerable communities by taking a harmful pesticide off the market,” said California Secretary for Environmental Protection Jared Blumenfeld. “This agreement avoids a protracted legal process while providing a clear timeline for California farmers as we look toward developing alternative pest management practices.”

Chlorpyrifos is used to control pests on a variety of crops, including alfalfa, almonds, citrus, cotton, grapes, and walnuts. It has declined in use over the past decade as California growers have shifted to safer alternatives, with DPR reporting that usage fell from two million pounds in 2005 to just over 900,000 pounds in 2017.

Earlier this year, DPR announced it was acting to ban use of chlorpyrifos by canceling the pesticide’s product registrations. DPR said the decision followed mounting evidence that chlorpyrifos is associated with serious health effects in children and other sensitive populations at lower levels of exposure than previously understood, including impaired brain and neurological development.

DPR and the California Department of Food and Agriculture (CDFA) have also established a working group to identify, evaluate, and recommend safer alternatives to chlorpyrifos. It will hold its first meeting this month and will hold three public workshops beginning in January. More than $5 million in grant funding has been appropriated for the project.

ARA Urges EPA Exemption for FGD Gypsum

News, News Briefs, Specialty

Retailers and other industry stakeholders had until Oct. 15 to submit comments to the U.S. EPA in support of an effort by the Agricultural Retailers Association (ARA) to have flue gas desulfurization (FGD) gypsum excluded from the Resource Conservation and Recovery Act (RCRA) when the product is used as a soil additive.

EPA has proposed changes to the agency’s Coal Combustion Residual (CCR) regulations related to the disposal of coal ash as hazardous waste, and ARA fears these revisions could result in changes to how FGD gypsum – which is produced by the removal of sulfur dioxide from flue gas streams at coal-fired utility plants – is distributed, stored, and applied as a soil amendment.

In an Oct. 11 letter to EPA Administrator Andrew Wheeler, ARA’s Richard Gupton said the proposed changes to the CCR regulations could cause “an unfair financial hardship on agricultural retailers and others within the agricultural industry, and impact the availability of this important fertilizer product.”

Gupton noted that EPA already exempts other agricultural products from RCRA, including zinc fertilizer and solid wastes generated by crops that are returned to the soil as fertilizers. “FGD gypsum, like mined gypsum, has very beneficial agricultural uses that have shown to enhance crop production, improve soil health, and improve water quality by reducing phosphorus runoff,” he said.

In the letter, Gupton states that gypsum is one of the earliest forms of fertilizer used in the U.S., and has been applied to farmland for more than 250 years as a source of the plant nutrients calcium and sulfur. The product is primarily used on peanuts, cotton, corn, wheat, and alfalfa, with peanuts benefiting particularly because of the crop’s high calcium needs.

The letter also stresses that gypsum as a food additive is recognized by the FDA as acceptable for human consumption, and that USDA’s Natural Resources Conservation Service has highlighted the product’s importance as a tool to reduce phosphorus runoff from fields that contributes to harmful algae blooms.

Gupton said if EPA is unable to fully exempt FGD gypsum from RCRA, then ARA is requesting that EPA maintain a 12,400-ton pile threshold and allow an exemption for agricultural retailers to handle the product. A typical pile of gypsum at retail facilities is around 10,000 tons, he said.

“Agricultural retailers temporarily store gypsum at their locations for no more than a 3-4 month period during the key part of the growing season,” the letter states. “The product is nontoxic and ecologically safe. All the gypsum products sold, distributed, stored, and applied by the agricultural industry have a Safety Data Sheet (SDS) that is required to be followed by the purchaser.”

Compass Minerals – Management Brief

Management Briefs, Specialty

Compass Minerals, Overland Park, Kan., said on Oct. 14 that Rick Axthelm has been named Vice President, Communications and Corporate Affairs. He joins the company with 20 years of government relations and corporate communications experience.

Most recently, he served as Senior Vice President, Communications and Government Affairs, at Contura Energy in Bristol, Tennessee. Prior to that he was Vice President, Communications and Government Affairs, at Alpha Natural Resources in Bristol, Va. Axthelm earned his B.A. in English from the University of Wyoming.

The Fertilizer Institute – Management Brief

Management Briefs

As previously reported (GM June 28, p. 1), effective Monday, Oct. 21, 2019, The Fertilizer Institute (TFI) President and CEO Chris Jahn will join the American Chemistry Council (ACC) as its President and CEO. A search committee chaired by TFI Chairman Tony Will, President and CEO of CF Industries Holdings Inc., Deerfield, Ill., has identified a short list of CEO candidates, and a first round of interviews with these individuals is taking place this month.

Until a new President and CEO is in place, Lara Moody, lmoody@tfi.org, will be the executive point person for industry and other external issues, and Kurt McMillan, kmcmillan@tfi.org, will handle membership and internal issues.

Ammonia

Ammonia, California, Caribbean, Eastern Cornbelt, Jordan, Market Watch, Pacific N.W., Tampa, U.S. Gulf, Western Canada, Western Cornbelt

U.S. Gulf/Tampa:

While Tampa for October remained at $255/mt CFR, some observers continued to argue that the next round of pricing should be up due to global outages that have spurred tight supplies.

An export of 25,000 mt was reported to have occurred out of NOLA for shipment in early November at $270/mt FOB, which some equate to $310/mt CFR Tampa. In the meantime, the sale would reflect a NOLA price of at least $245/st FOB.

Eastern Cornbelt:

Anhydrous ammonia pricing remained at $390-$400/st FOB in the Eastern Cornbelt, with the low in Illinois and the upper end in Indiana and Ohio, depending on location.

There is very little activity at the terminals today,” said one regional contact at midweek. “The crop is late coming off due to late planting. I think we are two weeks away from any major movement if-if-if-if the weather holds out.”

Western Cornbelt:

The ammonia market remained at $380-$390/st FOB terminals in Nebraska, and $385-$390/st FOB in Iowa and Missouri.

California:

Anhydrous ammonia postings remained at $360/st DEL in California, with aqua ammonia referenced at $100/st FOB.

Pacific Northwest:

Anhydrous ammonia pricing was pegged at the $390/st level FOB terminals in Washington, unchanged from last report, with truck-DEL tons quoted at the $420/st mark in Idaho. Railed offers were reported at the $360-$380/st level on a spot basis in the region, depending on location and point of origin.

Aqua ammonia was quoted at $104/st FOB Kennewick, Wash., up $5/st from last report.

Western Canada:

Ammonia pricing for fall tons was steady at C$680-$700/mt DEL in Western Canada, depending on producer and location.

“Ammonia is trickling out sporadically in regional pockets across Alberta, Saskatchewan, and in Manitoba close to the Saskatchewan border,” said one regional contact. “With poor crop conditions, suppliers are willing to sell tons out of all terminals. It could be short-selling to ensure tons get to the ground.”

Trinidad:

The Nutrien No. 4 plant returned to production within the past week after being down due to a collapsed cooling tower (GM Sept. 20, p. 3), but the plant reportedly had to go back down for a few more days due to a water leak.

Jordan:

Jordan Phosphate Mines Co. (JPMC) reported that a “very limited amount” of ammonia was released from a safety valve during operations at one of the production units at its Aqaba Industrial Complex on Oct. 14, according to Jordan’s Petra news agency, citing Abdul Aziz Abbadi, the Director of JPMCs Aqaba Industrial Complex.

He said the emissions were immediately contained, but the release affected “a number of workers” who were immediately transferred to the site’s first aid clinic and then referred to a nearby hospital, according to the report.

The producer has capacity for 3,000 mt/d of DAP at the Aqaba Industrial Complex, as well as units for sulfuric and phosphoric acid production.

Wilbur-Ellis – Management Brief

Management Briefs

Wilbur-Ellis, San Francisco, has appointed Laura Fiffick as Environmental, Health, Safety, and Security Director. The company said she brings 28 years of diverse HSE experience, including stints with consulting firm Krause Bell Group, BNSF Railway, and the National Safety Council at the Campbell Institute.

In the meantime, the feed unit (GM March 1, p. 30) of Wilbur-Ellis Nutrition, Vancouver, Wash., recently named Pedro Curry as its Chief Operating Officer. Curry was most recently General Manager for QualiTech’s Ag Nutrition Division, and has 25 years of experience covering the U.S., Asia-Pacific, and Central and South America.

Commission Greenlights Crystal Peak Project

News, News Briefs, Potash, Specialty

Utah’s Millard County Planning Commission unanimously approved a conditional use permit for Crystal Peak Minerals’ Sevier Playa Potash Project earlier this month, according to the Millard County Chronicle Progress. The matter now moves on to the local County Commission, which will make a final decision on the permit at an upcoming meeting.

In August, Crystal Peak Minerals received a positive Record of Decision from the U.S. Bureau of Mines (GM Aug. 30, p. 1). Upon receipt of funding and completion of detailed engineering, the company said it will be in a position to begin construction in 2020.

Aramco Delays IPO Again

News, News Briefs, Saudi Arabia

Saudi Aramco abruptly postponed the launch of the world’s largest initial public offering (GM Sept. 27, p. 27) by at least a few weeks, according to a Bloomberg report late on Oct. 17, citing people briefed on the situation. The delay will give the array of Wall Street banks advising the Saudi state oil producer time to incorporate third-quarter results into their pre-IPO assessment valuations, said one of the sources. The banks are reportedly still struggling to meet the $2 trillion valuation the company is seeking.

The delay disrupts the plan to launch the share sale on Oct. 20, which would have ended with an IPO in late November. Now, a listing is unlikely before December or perhaps January.

Last year, Aramco delayed the IPO after more than two years of preparations as international investors balked at the $2 trillion valuation Crown Prince Mohammed bin Salman had put on the company.

This time Saudi Arabia opted for an easier route, deciding to start with a local listing only in Riyadh – ditching plans for a sale in London or New York – and enlisting local banks and wealthy families to support the IPO.

The Saudi government had seemed determined to press on with an accelerated schedule even in the face of potential headwinds that include weak oil prices, a slowing world economy, and last month’s attack on the company’s biggest processing plant, according to Bloomberg. While details of the proposed offer have not been made public, people involved in the transaction said earlier this month that about 2 percent of Aramco might be sold, raising $40 billion.

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