Dry Fertilizer Barge Rates
| 9/21/2018 | Last Week | |
| Memphis | 13.00-15.00 | 13.00-15.00 |
| St. Louis | 14.00-16.00 | 14.00-16.00 |
| Peoria | 18.00-22.00 | 18.00-22.00 |
| Cincinnati | 17.00-22.00 | 17.00-22.00 |
| St. Paul | 25.00-27.00 | 25.00-27.00 |
| Catoosa/Inola | 27.00-29.00 | 27.00-29.00 |
All Posts from September 21, 2018
Nutrien Continues to Eye 4Q SQM Exit; Tianqi Lithium Vows No Interference
Nutrien Ltd., Saskatoon, this week said it continues to eye a fourth-quarter close on the sale of its 24 percent stake in SQM, Santiago, for US$4.07 billion to China’s Tianqi Lithium (GM May 18, p. 1). SQM said on Sept. 13 that it opposes a proposed out-of-court settlement between the Chilean Antitrust Regulator, Fiscalia Nacional Economica (FNE), and China’s Tianqi Lithium Corp. relating to the purchase (GM Sept. 14, p. 25).
Nutrien said on Sept. 14 that it is evaluating all potential responsive actions. It told Green Markets this week that it would have no further comment while everything is being reviewed by the Chilean regulatory and court systems.
As previously reported, FNE put together a long list of stipulations for Tianqi Lithium to adhere to after the sale; however, that was not enough for SQM, which expressed its opposition on Sept. 13 at a hearing before Chile’s Antitrust Court, the Tribunal de la Libre Competencia (TDLC). TDLC must approve or reject the proposal. The agreement expires on Oct. 4 if no decision has been made.
“The out-of-court settlement does not affect Tianqi Lithium’s rights in SQM and does not change Tianqi Lithium’s view on this transaction,” the Chinese company told Bloomberg. “This transaction will generate stable investment returns to the company under the current arrangements. We do not and will not interfere in the daily operation of SQM.”
According to Bloomberg, the combined lithium output of Tianqi Lithium, SQM, and Albermarle accounts for over half of the world’s lithium production.
Nutrien must sell its SQM stake as a condition of China and India’s approval for the Potash Corp. of Saskatchewan Inc. and Agrium Inc. merger.
Wisconsin Co-ops Consider Merger
Another regional cooperative merger is under consideration in the upper Midwest. The boards of directors of ProVision Partners Cooperative, Marshfield, Wisc., and Premier Cooperative, Mt Horeb, Wisc., announced that they have signed a letter of intent (LOI) to explore a merger.
Both co-ops have large agronomy businesses in central and southern Wisconsin, in addition to operating grain, feed, energy, convenience store, and automotive divisions. A memo distributed to members noted “similar cultures and core divisions” between the two businesses, and said the “increased size and scale caused by the merger would make the co-op a preferred partner with major manufacturers.”
Premier CEO Andy Fiene also said the combined territory would “create new opportunities for growth and efficiencies, such as allowing us to share expensive, high-tech equipment and some staff during the spring as planting moves north.”
The merger proposal will be presented to co-op members for a vote this winter. If approved, the merger will take place on Oct. 1, 2019. Each co-op would have five directors serving on the new board. ProVision and Premier did not announce what name the combined company would have.
“The potential merger is a sound plan that provides financial security for patrons’ allocated equity, significant long-term savings, efficiencies in current operations, and opportunities to further expand our technology and other services for both our cooperatives’ and patrons’ operations,” said David Brill, ProVision board chairman.
“Both boards voted unanimously to pursue this opportunity,” said Steve Burns, Premier board chairman. “Together, we’ve identified many benefits, and we look forward to working together over the next several months to finalize a plan of merger for the future of our cooperatives, the members, and employee team.”
ProVision was formed in 2015 with the merger of Harmony Country Cooperative in Colby, Wisc., and Central Wisconsin Cooperative in Stratford, Wisc. The member-owned company has agronomy locations in Auburndale, Stratford, and Unity, and employs about 220 individuals in the communities it serves. ProVision has annual sales of about $110 million.
Premier was formed in 1893 and is recognized as the oldest farm and consumer supply cooperative in the U.S. The company has 19 locations and some 380 staff members, and posts annual sales of about $190 million.
“Bigger doesn’t automatically mean better, but if well-run, a larger organization will have advantages and opportunities not available to smaller companies,” Fiene said. “Most importantly, we’ll have the financial performance and balance sheet strength needed to attract and retain talented staff, while investing in the equipment, facilities, and other tools they need to help make our members successful.”
Sirius Reports Major Poly4 Offtake Deal, Equity Stake in Brazil Distributor
Sirius Minerals, Scarborough, England, reported on Sept. 17 that it has signed its largest-ever offtake agreement for its Poly4 fertilizer. It is with Brazil’s sixth largest fertilizer distributor, OFD Supply Inc. and Cibrafertil Companhia Brasileira de Fertilizantes (Cibra Group Companies), which is owned by Omimex Group, a privately-held independent fertilizer and energy group based in Fort Worth, Texas. The offtake will increase to 2.5 million mt/y in the seventh year of production.
As a result of the deal, Sirius said its take-or-pay sales volume has now increased to 8.2 million mt/y, surpassing the 6-7 million mt/y target required to underpin Stage 2 financing.
Poly4 is the trademark name for polyhalite products from Sirius’ polyhalite project in North Yorkshire, U.K. Construction of the project began in 2017 (GM March 31, 2017), with first production planned for the end of 2021. The company describes Poly4 as a naturally occurring fertilizer that contains potassium, sulfur, magnesium, and calcium in one product, available in granulated, powered, or standard form.
In addition, Sirius has simultaneously acquired 30 percent of certain Cibra Group Companies in return for 95 million ordinary shares in Sirius, providing Sirius with established infrastructure and direct access into the fertilizer distribution business. The Sirius shares issued to Cibra shareholders will be subject to a lock-up period of 12 months.
“We are delighted to have signed these supply and investment agreements with a leading player in the South American fertilizer market with a proven track record and ambitious growth plans,” said Chris Fraser, Sirius managing director and CEO. “Cibra is a perfect partner for distributing Poly4 into this key market, where trials have demonstrated how it can significantly enhance farming economics. The Cibra offtake agreement takes us beyond our targeted 7 million mt/y, and is a major step forward as we look to complete Stage 2 financing and building our global fertilizer business.”
“We are excited to be entering into this long-term partnership with Sirius to deliver Poly4 into Brazil and other key markets of South America,” said Santiago Franco, Cibra CEO. “The supply agreement provides Cibra with access to a unique multi-nutrient product that will play an important and valuable role in one of the fastest growing fertilizer markets in the world. Poly4 will change the shape of the fertilizer market in South America, and Cibra will be at the heart of driving the growth and adoption of this innovative, sustainable product across the region.”
Cibra annual revenues are reported at US$500 million. It operates one single super phosphate (SSP) plant, nine blending plants, and a distribution center, and has operations and warehouses in multiple key ports across Brazil. Cibra said it holds a market share in Brazil of approximately four percent.
The supply agreement provides for resale of Poly4 on an exclusive basis into Brazil, Bolivia, French Guaiana, Guyana, Paraguay, Surinam, Uruguay, and Venezuela, and on a non-exclusive basis into Argentina, Chile, Colombia, Ecuador, and Peru. The initial contract term of seven years may be extended for two additional five-year periods.
Minimum contracted take-or-pay volume commitments under the supply agreement increase to 2.5 million mt/y by the seventh year following commencement of commercial production. The agreement contains provisions that allow Cibra to roll forward and roll back a small proportion of take-or-pay volumes between contract years.
Pricing terms include a minimum commitment price that is linked to relevant product benchmarks, as well as a unique downstream price participation mechanism which enables Sirius to benefit from higher realized Poly4 prices for the duration of the contract. Pricing to be received by Sirius under the agreement is expected to be broadly in-line with other offtake agreements in the early years of supply, with the potential to realize higher pricing sooner than the company’s existing supply agreements.
Following completion of the acquisition of the equity in Cibra, management will remain unchanged. However, under the shareholder agreements, Sirius will have the right to appoint a director, and Chris Fraser will join the boards of each of the Cibra Group Companies.
BayoTech Continues to Advance Modular Hydrogen and Nitrogen Production Technology
BayoTech Inc., Albuquerque, N.M., continues to advance its modular nitrogen fertilizer production technology, expecting to provide its major fertilizer company partner and investor with a hydrogen production unit next year. BayoTech reports that it will begin building its first hydrogen prototype system later this year for delivery to the partner in 2019.
“The company will use it for fertilizer production, providing a much cheaper way for them to make the hydrogen they need for their manufacturing process,” Justin Eisensach, BayoTech CEO, told The Albuquerque Journal. “They’ll test it first and then hopefully convert to commercial orders that we’ll fill under a supply agreement.”
BayoTech hopes to have its first full fertilizer plant by 2020. The three-step process will start with the hydrogen unit, followed by an anhydrous ammonia unit in 2019, and then a urea unit.
BayoTech says it now has $16 million in venture investment since 2016. In April, it announced that it had closed a $12.5 million Series B round of financing (GM April 13, p. 1).
BayoTech continues to keep the name of its fertilizer producer partner confidential, but says it is a significant player in the global fertilizer marketplace. The unnamed company participated in the Series B round of financing along with Series A investors Cottonwood Technology Fund and Sun Mountain Capital.
Founded in July 2015, BayoTech said it is the world’s first modular, scalable, and rapidly deployable platform for the production of hydrogen, ammonia, and urea for the agricultural and industrial markets.
The technology could conceivably revolutionize the nitrogen fertilizer industry. Rather than the traditional giant $2 billion+ nitrogen plants coming online in recent years, BayoTech’s $15 million unit can be shipped in three 40-foot shipping containers and produce 28 st/d of ammonia and 50 st/d of urea (GM Oct. 7, 2016). As a result, small ammonia and/or urea plants could be dotted around the globe and drastically cut transportation costs.
BayoTech licensed the technology from Sandia National Laboratories and enhanced it for broader applications. Sandia spent some $50 million to design the technology. BayoTech is partnering with Process Equipment & Service Co., Farmington, N.M., to construct the modular units.
Eisenach told the Journal that the company is getting attention from all over the world, and that in late September he will be in Switzerland and Germany discussing the technology and visiting some of the world’s largest hydrogen users.
Compass Minerals – Management Brief
Compass Minerals, Overland Park, Kan., has named Angela Jones to the position of senior vice president, people and culture, effective immediately. She will be responsible for leading the company’s people strategy and global human resources team. In this role, she is focused on building an inclusive, high-performing culture that will enable their businesses to drive product innovation, operational excellence, and global market expansion.
Jones joined Compass Minerals as vice president, human resources, in January 2018, bringing more than 13 years of human resources experience and more than 16 years in operations.
“In her short time here, Angela has made an impact on the company through her leadership in organizational and talent development and her commitment to building a diverse, highly skilled workforce,” said Fran Malecha, Compass Minerals president and CEO. “Angela’s significant operations experience, combined with her passion to drive culture evolution, will result in great opportunities for growth and development for our employees.”
Prior to joining Compass Minerals, Jones served as vice president human resources at both Rembrandt Enterprises and ConAgra Brands Inc. In addition, she held roles such as director of operations and plant general manager for The Clorox Co., as well as progressively responsible supply chain and operations roles with Proctor & Gamble.
Jones holds a B.S. in Chemical Engineering and an M.S. in management from the Georgia Institute of Technology.
CSX Corp. – Management Brief
CSX Corp., Jacksonville, Fla., has named Dean Piacente as vice president, industrial products, and Maryclare Kenney as vice president, intermodal and automotive.
Piacente was previously vice president, intermodal, and now assumes responsibility for the company’s chemicals, metals, paper, and forest products businesses. He has more than 30 years of experience at CSX across different customer segments, including 11 years leading the chemicals and fertilizer business.
Piacente, who joined CSX in 1987, holds a bachelor’s degree in computer science from Florida State University.
Kenney, who led CSX’s automotive business, assumes responsibility for CSX’s intermodal sales & marketing, as well as continuing to lead the automotive business. Kenney joined CSX in 2011 and has held roles of increasing responsibility, which includes five years in intermodal.
Kenney joined CSX in 2011 and previously worked for PepsiCo, following a seven-year military career with the U.S. Army, in which she attained the rank of captain. She holds a bachelor’s degree in government and international affairs from Notre Dame University and an MBA from the Harvard Business School.
Tim McNulty, who is vice president of agricultural and mineral products, will continue to lead the balance of the merchandise portfolio and will report directly to Mark Wallace, executive vice president, sales & marketing.
Corteva Agriscience – Management Brief
Corteva Agriscience, the Agriculture Division of DowDuPont, announced a number of leadership changes on Sept. 18, which it said are designed to optimize the company’s ability to deliver growth and value for shareholders, customers, and employees as an independent, pure-play agriculture company.
James C. Collins Jr., who has served as chief operating officer of the Agriculture Division, will become CEO of Corteva Agriscience when it separates from the company, which is expected to occur by June 1, 2019. Corteva Agriscience combines the former DuPont Pioneer, DuPont Crop Protection, and Dow AgroSciences businesses.
The leadership team reporting to Collins includes Rajan Gajaria, who was formerly vice president of Crop Protection of the Agriculture Division of DowDuPont and will now be executive vice president of Corteva Agriscience’s Business Platform; Tim Glenn, former vice president of Seed of the Agriculture Division of DowDuPont, now serving as executive vice president, chief commercial officer; Greg Friedman, who served as the head of finance of the Agriculture Division and vice president of Investor Relations for DowDuPont and is now Corteva’s executive vice president, chief financial officer; and Cornel Fuerer, head of legal for the Agriculture Division, who will now be senior vice president, general counsel.
“Over the past year, we have put in place a strong foundation to build Corteva into a global agriculture leader ideally equipped to grow by putting our customers at the center of everything we do,” said Collins. “Now we are putting the best people in the roles to accelerate the momentum we’ve built as a division and capture the dynamic opportunities we have to serve our customers as a multi-brand, multi-channel business and drive growth into the future.”
SQM Aussie Lithium Project Hits Snag
Santiago-based SQM’s joint venture lithium project in Australia (GM Dec. 22, 2017), Mount Holland Lithium Project, has hit a snag. A West Australian Warden’s Court has recommended to Western Australia’s Mines Minister Bill Johnston that he reject the jv’s exemption from minimum expenditure obligations over tenements associated with the project.
Reportedly, the expenditure lapse occurred prior to jv partners Kidman Resources acquiring the tenements in July 2016. Having spent some $55 million on the project to date, Kidman and SQM argue that the minister should allow the exemption.
Nutrien Reports Phos Acid Spill
Nutrien Ltd., Saskatoon, confirmed that its Swift Creek Chemical plant at Nutrien White Springs Phosphate experienced a phosphoric acid spill on Sept. 13 around 3:30 a.m. due to equipment failure. The company said its emergency response team quickly responded and the 200,000-gallon spill was fully contained on site. No injuries or damage to the environment were reported.
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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.
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