Compass Minerals, Overland Park, Kan., on July 21 announced
the signing of a nonbinding Memorandum of Understanding (MOU) to explore
supplying Ford Motor Co. with a battery-grade lithium product from its lithium
brine development project at its Ogden, Utah, solar evaporation facility.
Under the terms, Compass and Ford will work together to
create a two-phase arrangement that secures a significant quantity of Compass’ production
for Ford starting in 2025. Both companies will continue good-faith
negotiations, aiming toward a definitive offtake and supply agreement.
The agreement with Ford quickly follows a similar MOU that
Compass signed with LG Energy Solution (GM July 1, p. 27).
Compass previously announced an expected annual commercial
production capacity of 30,000-40,000 mt lithium carbonate equivalent (LCE) for
the project, with an initial phase-one capacity of approximately 10,000 mt LCE
coming online by 2025.
Compass is pursuing the sustainable development of an
approximate 2.4 million mt LCE resource on the Great Salt Lake, available for
extraction through existing permits, water rights, and operational
infrastructure at the company’s Ogden facility.
The U.S. International
Trade Commission (ITC) on July 18 determined that the U.S. UAN industry is not
materially injured or threatened with material injury by reason of imports of UAN
from Russia and Trinidad and Tobago that the U.S. Department of Commerce (DOC)
has determined are subsidized and sold in the U.S. at less than fair value (GM June 24, p. 1).
The vote was
unanimous. Chairman David S. Johanson and Commissioners Rhonda K. Schmidtlein,
Jason E. Kearns, Randolph J. Stayin, and Amy A. Karpel voted in the negative.
ITC said that as a
result of the negative determinations, DOC will not issue countervailing duty
orders and antidumping duty orders on imports of this product from Russia and
Trinidad and Tobago.
“This comes as a welcome relief,” said
National Corn Growers Association (NGCA) President Chris Edgington. “We have
been sounding the alarms and telling the ITC Commissioners that tariffs will
drive up input prices to even more unaffordable levels for farmers and cripple
our supply. I am so glad they listened.”
In addition to NGCA, other ag trade groups, including the Agricultural Retailers Association, Russian and Trinidad producers, U.S. importers and marketers, and several Members of Congress, sought a negative vote, citing record high fertilizer prices, UAN producer profits, and industry consolidation.
“We are disappointed that the International Trade
Commission has determined the U.S. UAN industry has not been harmed by the
unfair trade practices from state-subsidized entities underpinning UAN imports
from Russia and Trinidad that were clearly established through thorough and
impartial investigations by the U.S. government,” said Tony Will, CF President
and CEO.
“Unfortunately, this outcome will perpetuate an unlevel
playing field for a domestic industry that has invested billions of dollars in
the U.S. to ensure American farmers have a reliable source of UAN fertilizer,” he
added.
CF reiterated that DOC’s June decision found that imports
from Russia are dumped (i.e., sold at less than fair value) at rates ranging
from 8.16%-122.93%, and unfairly subsidized at rates ranging from 6.27%-9.66%.
In addition, it noted that DOC found that imports from Trinidad are dumped at a
rate of 111.71% and unfairly subsidized at a rate of 1.83%.
The ruling sent CF shares tumbling as much as 4.9% in New York
on July 18. However, the downward momentum was only temporary, and shares were
back up for the July 19 close. CF filed the petition for the U.S. to impose
duties in June 2021 (GM July 2, 2021).
The Commission’s public report Urea Ammonium Nitrate Solutions from Russia and Trinidad and Tobago [Inv. Nos. 701-TA-668-669 and 731-TA-1565-1566 (Final), USITC Publication 5338, August 2022] will contain the views of the Commission and information developed during the investigations. The report will be available by Aug. 22, 2022; when available, it may be accessed on the USITC website at http://pubapps.usitc.gov/applications/publogs/qry_publication_loglist.asp.
In the
meantime, ITC’s 2021 decision (GM April
23, 2021; March 12, 2021) to allow duties on phosphate imports from Russia and
Morocco is currently on appeal with the Court of International Trade (GM July 1, p. 1).
Martin Midstream
Partners LP (MMLP), Kilgore, Texas, reported second-quarter net income of $6.6
million ($0.17 per diluted unit) on revenues of $267 million, up from a
year-ago loss of $6.6 million ($0.17 per unit) and $184.3 million, respectively.
Adjusted EBITDA was $38.3 million, up from the year-ago $22.5 million.
The company
boosted annual adjusted EBITDA guidance to $126-$135 million from the previous
guidance of $110-$120 million. It also declared a quarterly distribution of
$0.005, or $0.02 per unit annually.
“The partnership
experienced another outstanding quarter, with elevated demand for our land transportation
assets and robust margins in our lubricants and fertilizer businesses,” said
Bob Bondurant, President and CEO of Martin Midstream GP LLC, the general
partner of MMLP.
“Overall, each of
our four business segments performed above expectations, beating the high range
of guidance for the quarter by $13 million,” he added. “We now expect the
current refinery utilization levels to remain strong through year end, which
will bring continued solid demand for our diversified products and services.”
MMLP’s Sulfur Services
segment, which also includes fertilizer, reported second-quarter operating
income of $9.1 million on revenues of $57 million, up from the year-ago $6.3
million and $38.3 million, respectively. Adjusted EBITDA was $13.9 million, up
from $8.9 million.
Despite robust
margins, second-quarter fertilizer volumes were off 26%, to 62,000 lt from the
year-ago 84,000 lt. Sulfur volumes were 118,000 lt, down 19% from the year-ago
146,000 lt.
Six-month Sulfur
Services operating income was $21.8 million on revenues of $116.1 million, up
from $12.8 million and $73.1 million, respectively. Adjusted EBITDA was $29.2
million, up from $18.1 million.
While six-month
sulfur volumes were up 6% at 232,000 lt from the year-ago 219,000 lt,
fertilizer volumes were off 18%, to 146,000 lt from 179,000 lt.
Company-wide, MMLP
reported six-month net income of $18.1 million ($0.46 per unit) on revenues of
$546.2 million, compared to a year-ago loss of $4.1 million ($0.10 per unit)
and $385.3 million, respectively. Adjusted EBITDA was $78.3 million, up from
$53.4 million.
A coalition of farm
groups, trade associations, and several crop input businesses in Canada are
calling on the federal government to provide compensation to farmers in Eastern
Canada who they said were negatively impacted by federal government-imposed
tariffs on imported Russian fertilizer this spring (GM March 18, p. 1).
The group is also
seeking the removal of tariffs in time for the fall application season and
planning for 2023, according to a July 18 press release. The companies and
associations listed in the announcement include Fertilizer Canada, the Ontario
Agri Business Association (OABA), Sollio Agriculture, Sylvite Agri-Services,
Atlantic Grains Council, Grain Farmers of Ontario, Ontario Bean Growers,
Ontario Canola Growers, Christian Farmers Federation of Ontario, and Quebec
Grain Farmers.
“Fertilizer is the
most important input for ensuring strong, hearty yields,” said Karen Proud,
President and CEO of Fertilizer Canada. “We need to support our growers and the
industry needs predictability for the 2023 growing seasons as the planning is
happening now. Now, more than ever, the world needs more Canada.”
The Canadian
government on March 3 implemented a 35% tariff on all Russian imports,
including fertilizer, in response to Russia’s invasion of Ukraine and as part
of Canada’s decision to withdraw the most-favored-nation status to Russia and
Belarus as trading partners. The tariff was not applied to products that were
in transit prior to March 2, 2022.
“This was done
without any prior consultation with the agriculture sector, and as a result,
Eastern Canadian farmers were disproportionately impacted,” the group states,
noting that approximately 660,000-680,000 mt/y of nitrogen fertilizer is
imported from Russia to Eastern Canada. This amount represents between 85-90%
of the total nitrogen fertilizer used in the region.
“The war in Ukraine
has added considerable strain to global food security and Canada’s agriculture
industry is well-positioned to help, but farmers’ ability to do this relies on
a secure, predictable supply of fertilizer to maximize crop yields,” the group said.
“Our industry strongly supports the people of Ukraine and condemns the Russian
invasion. We also support sanctions and other measures imposed by the Canadian
government and our allies aimed at quickly ending the war. However, action by
the Canadian government should not jeopardize Canada’s capacity to produce food
today or in the future.”
According to the
statement, Canada is the only G7 country that has tariffs on Russian
fertilizer, placing Canada’s agricultural industry at a “competitive
disadvantage” to other countries around the world.
“Farmers bore the
costs of tariffs, which has put Canadian farmers at a disadvantage to farmers
in other countries who did not have tariffs on fertilizers,” said Christian
Overbeek, Chairman of Québec Grain Farmers. “We need compensation for farmers
and concrete solutions for the 2023 planting season in place this summer.”
According to OABA
Executive Director Russel Hurst, as reported by Syngenta Canada, the tariff in
most cases was initially paid by fertilizer importers, but then passed down the
distribution chain, ultimately hitting farmers. Depending on how much spring
tonnage was prepaid, Hurst estimated the tariff added C$150-$180 million in
input cost, with most of that expense falling on Ontario producers, and about a
third hitting growers in Quebec and the Maritimes.
Hurst said
fall fertilizer supplies for Ontario are now essentially in place, but the 35%
tariff will continue to be applied to any Russian product. “The fall planting
season is quickly approaching, as well as procurement preparations for 2023,” he
said. “Compensation for growers and predictability for industry will be
important in the coming months as Canada’s agriculture industry steps up to do
our part in this global crisis.”
Nutrien Ltd. announced on
July 20 that it has entered into an agreement to acquire Brazilian company Casa
do Adubo S.A. (Casa do Adubo). The acquisition includes 39 retail locations
under the brand Casa do Adubo, and 10 distribution centers under the brand
Agrodistribuidor Casal, all located in the states of Acre, Bahia, Espírito
Santo, Maranhão, Mato Grosso, Minas Gerais, Pará, Rio de Janeiro, Rondônia, São
Paulo, and Tocantins.
Terms of the deal were not
disclosed, but Nutrien said the transaction supports its Retail growth strategy
in Brazil and is expected to result in additional run-rate sales of
approximately US$400 million, increasing total Nutrien Ag Solutions annual
sales in Latin America to approximately US$2.2 billion. The transaction is
pending approval from the Administrative Council for Economic Defense (CADE) in
Brazil.
“The acquisition expands our
footprint in Brazil from five states to 13 and supports growers in a key region
of the world that will increasingly be relied on to sustainably increase crop
production and feed a growing population, especially with the current global
food insecurity challenges,” said Ken Seitz, Interim President and CEO at
Nutrien.
“Our strong team in Brazil
has successfully closed and onboarded five transactions since 2020,” Seitz
added. “We expect that integrating Casa do Adubo will further enhance our
ability to provide whole-acre solutions for all customers in the region, while
delivering quality earnings in this large and growing market.”
Subject to approval and
completion of the acquisition, Nutrien expects to surpass its stated target of
US$100 million of adjusted EBITDA in Brazil by 2023. The company will have 180
commercial units in Latin America, including customer-facing retail branches
and experience centers, five industrial plants, and four fertilizer blenders.
In addition, Nutrien will have more than 3,500 employees in the region,
including more than 700 crop consultants serving growers in Argentina, Brazil,
Chile, and Uruguay.
“We appreciate the reputation
Casa do Adubo has earned for delivering strong financial performance,
attracting top talent, and offering quality products and services,” said André
Dias, Nutrien’s Regional Leader in Latin America. “With the acquisition, we
will strengthen our existing presence and expand to serve additional growers
with innovative solutions that help sustainably feed the world.”
The transaction comes just
three weeks after Nutrien announced an agreement to acquire Marca Agro Mercantil, an agricultural
inputs retailer with seven stores in the regions of Triângulo, Alto Paranaíba,
and Sudoeste Mineiro in Brazil (GM
July 1, p. 1). Last December, Nutrien said it planned to spend R$600 million in
2022 on Brazil expansion (GM Dec. 17,
2021).
Yara
International ASA warned this week that there is “a clear risk of nitrogen
shortages and further price spikes if the natural gas availability in Europe continues
to deteriorate.”
The Oslo-based major said it has curtailed several of its production plants, currently amounting to an annual capacity of 1.3 million mt of ammonia and 1.7 million mt of finished fertilizer, and warned that more cuts may come (see related Yara earnings story).
The
current curtailments in Yara’s ammonia and finished fertilizer production
equate to around 27% and 18%, respectively, of the company’s European capacity,
according to a Dow Jones report on
July 19.
German
chemicals giant BASF SE also is among several other European producers to have
curtailed output (GM July 1, p. 1)
and has reduced ammonia production rates at Ludwigshafen, Germany, and Antwerp,
Belgium.
BASF,
as cited by the Dow Jones report,
said all internal and external customer needs were currently being met, but
that further curtailments to ammonia production “would put additional
pressure on an already extremely tight market.”
Germany’s Baader Bank AG said early this month a possible shutdown of BASF’s Ludwigshafen site could be compensated by the company’s production facilities in Antwerp and in the U.S. BASF has ammonia production capacity of 910,000 mt/y at Ludwigshafen and 610,000 mt/y at Antwerp, according to Green Markets’ database.
In the
U.S., BASF has a 32% stake in an ammonia production joint venture with Yara –
Yara Freeport LLC in Freeport, Texas, which started up in April 2018 (GM April 13, 2018). The plant, located
at BASF’s site in Freeport, has a capacity of 750,000 mt/y, and each party
offtakes ammonia according to their ownership share.
Jacob Hansen, the Director General of European fertilizer manufacturers’ industry organization Fertilizers Europe, in a July 20 statement warned that without a steady supply of affordable gas, “there is a looming risk for European fertilizer production and in turn food production in the European Union (E.U.).”
In the
past weeks, European fertilizer producers grappled with historically high gas
prices leading to another round of curtailments, the industry body noted.
“If
natural gas availability is to deteriorate further, Europe risks experiencing
fertilizer shortages that will impact Europe’s agriculture in the coming
season,” said Hansen.
While
acknowledging the European Commission’s efforts to ensure coordinated action to
prepare for possible further gas disruptions, Fertilizers Europe is calling on
the E.U. and Member States’ leaders to ensure that “the gas flows where it
is most needed, protecting domestic users as well as prioritizing essential
sectors of the economy.”
“Maintaining
a well-functioning fertilizer sector across Europe is essential to avert risk
of fertilizer shortages which could have a detrimental effect on Europe’s food
sovereignty,” Hansen said.
The
E.U. has forecast near-term gas shortages amid the risk of further gas supply
cuts from Russia, with the European Commission noting in a statement this week that
almost half of Member States already are affected by reduced Russian gas deliveries.
Amid
its efforts to reduce the Bloc’s reliance on Russian supply, the Commission has
proposed this week that Member States cut natural gas usage by 15% between Aug.
1, 2022, and March 31, 2023, and according to a report by the U.K.’s Financial Times, is preparing to tell
Member States to cut gas consumption “immediately.”
The
Commission will provide members next week with voluntary gas reduction targets,
cautioning that targets will be “mandatory” in the event of severe
disruption to supplies, according to the report.
This
came amid uncertainty surrounding the reopening of the Nord Stream 1 gas
pipeline connecting Russia with Europe via Germany. Early in the week Russia’s Gazprom declared force majeure on at least three European
gas buyers, according to Bloomberg, a
move that signalled to some that it intended to keep supplies capped. The
continent had been bracing itself for Russia not to restart gas flows through
the pipeline, but it was able to breathe a little relief on July 21 when gas
flows resumed after the pipeline was closed for 10 days for planned
maintenance.
Shipments
are being made at some 40% of capacity as of July 21, Bloomberg reported, citing data from the pipeline operator.
However,
while the restart has eased Europe’s worst fears that Russian President
Vladimir Putin would keep the pipeline halted, much uncertainty continues about
future gas flows through the critical link. Putin’s time of maximum leverage on
gas supplies will occur as Europe heads into winter.
Europe
should be prepared for Russia to stop supplying the region completely this
winter, the International Energy Agency (IEA) told the Financial Times last month.
IEA
Executive Director Faith Birol told the newspaper that “The nearer we are
coming to winter, the more we understand Russia’s intentions. Europe should be
ready in case Russian gas is completely cut off.”
European
benchmark natural gas prices on the Dutch TTF gas futures in Amsterdam eased
marginally on the restart of the Nord Stream pipeline, with the front-month
contract (currently August) down 0.811% on the day at €156.295 a megawatt-hour
(MWh) as of 3:59 p.m. (GMT).The front-month traded as high as €180.505 per MWh
last week, on July 13.
Yara International
ASA, Oslo, reported a 23% increase in net income attributable to shareholders
of the company to $664 million ($2.61 per share) on revenue of $6.45 billion
for the second-quarter ended June 30, up from the year-ago $539 million ($2.10
per share) and $3.95 billion, respectively.
EBITDA excluding
special items rose 90% to $1.48 billion, up from $775 million the previous
year, beating analysts’ average estimate of $1.35 billion (Bloomberg Consensus). Revenue was up 63% and was on par with
analysts’ average estimate of $6.45 billion. Second-quarter operating income
was $1.22 billion, compared with the year-ago $477 million.
Yara reported higher selling prices and a particularly strong financial performance from overseas assets, which more than offset higher European feedstock costs and lower deliveries, according to its July 19 results statement. The Americas, Africa, and Asia segments accounted for approximately 55% of the company’s EBITDA in the second quarter.
However, this was
partially offset by currency translation loss, which the company noted was
driven mainly by the impact of a stronger U.S. dollar on its debt portfolio,
which is primarily held in U.S. dollars.
Total Yara
second-quarter deliveries were down 18% at 8.06 million mt, versus the year-ago
9.78 million mt. Second-quarter fertilizer deliveries fell 21% year-over-year,
to 5.79 million mt, down from 7.35 million mt. The company noted premium
products were more resilient with a year-over-year decline of 14%. The drop in
deliveries was largest in Europe and Americas, each down by 22% on a year ago.
Yara said it has currently curtailed several of its production plants, amounting to an annual capacity of 1.3 million mt of ammonia and 1.7 million mt of finished fertilizer, and warned that more cuts may come. The current curtailments in ammonia and finished fertilizer production equate to around 27% and 18%, respectively, of the company’s European capacity, according to a Dow Jones report.
Of the finished
product curtailments, roughly half is urea for fertilizer, while the rest is
nitrates and NPKs.
Company-wide
ammonia production in the second quarter was down 11% at 1.69 million mt versus
the year-ago 1.89 million mt, while first-half output was 7% lower at 3.41
million mt compared to 3.68 million mt.
In addition to
curtailments due to increased gas costs, Yara reported reliability issues in
Pilbara, Australia; Ferrara, Italy; Brunsbuttel, Germany; and Cubatão, Brazil,
and also turnaround delays at Hull, U.K., and Cubatão, impacting its
second-quarter ammonia production.
Production of total finished products (fertilizer and industrial, but excluding bulk blends) fell by 10% to 4.47 million mt, down from 4.98 million mt in second-quarter 2021, and also by 7% in the first half, to 9.33 million mt from 10.04 million mt.
There were also
reliability issues within finished products, with Yara noting “the major
impacts” in Tertre, Belgium; Porsgrunn, Norway; Babrala, India; and at
Cubatão.
Yara highlighted that
there is no material impact on the company’s finished product volumes “so
far” due to lack of raw materials, as it has increased its phosphates and
potash sourcing from existing suppliers and entered into contracts with new
suppliers to offset lost volumes from suppliers linked to sanctions.
The company also highlighted the ability of its NPK plants to adapt to both raw material sourcing and NPK grades produced in response to significant market disruptions, both in terms of raw material supply and customer demand.
“Seasonally
lower Northern Hemisphere demand, combined with the recent European gas price
surge, is leading to significant curtailments in Europe, including Yara,” said
Yara President and CEO Svein Tore Holsether.
The company sees
gas costs for the third and fourth quarters of 2022 respectively at $1.1
billion and $920 million higher than a year earlier, based on current forward
markets for natural gas and assuming stable gas purchase volumes.
In Europe, Yara
noted that nitrogen deliveries for the industry in the 2021/22 season are
estimated to end 19% behind a year earlier, as higher fertilizer prices have
shifted optimal application rates lower. It said nitrate inventories in Europe
are at a historically low level, and new season buying has been limited so far.
“Despite a
recent correction in grain prices, farmer profitability remains high. But there
is a clear risk of nitrogen shortages and further price spikes if buying is
delayed, especially if natural gas availability in Europe continues to
deteriorate,” said Holsether.
Yara said it will
continue to adapt to market conditions and – where possible – use its global
sourcing and production system to supply customers, but said it cannot produce
at negative margins.
In an interview on
Bloomberg TV on July 19, Holsether
said the company is “on constant watch” in case it needs to further
lower production.
For Europe, second-quarter
EBITDA excluding special items was $150 million higher than a year earlier, as
higher prices more than offset lower deliveries and increased feedstock costs.
Deliveries decreased by 22% to 1.58 million mt, down from the year-ago 2.03
million mt, mainly reflecting lower demand due to high market prices.
For the Americas,
EBITDA excluding special items was $406 million higher in the second quarter
than a year earlier, mainly reflecting significantly higher nitrogen upgrading
margins in North America.
Deliveries were
down 22% to 3.01 million mt, with Yara citing the sanctions imposed on
suppliers from Russia and Belarus impacting deliveries of commodity fertilizers
for blending and distribution. However, the company said premium product
deliveries were relatively strong with a decline of only 2%.
For Africa & Asia (which also includes Oceania), second-quarter EBITDA excluding special items was $55 million higher than a year earlier, driven – Yara said – by higher production margins on ammonia. Total deliveries were 18% lower at 1.21 million mt as high fertilizer prices and weaker farmer profitability in several core segments of the region impacted demand.
Yara’s Global
Plants & Operational Excellence (GPOE) business posted a second-quarter
EBITDA excluding special items $72 million higher than a year earlier. The
result was mainly driven by increased nitrogen and phosphate prices, which more
than offset increased energy costs and raw material price increases.
The Clean Ammonia
business posted EBITDA excluding special items in the second quarter $9 million
higher than the previous year, as increased margins linked to higher ammonia
prices more than offset lower volumes. The lower volumes mainly reflect a stop
in sourcing from Russia and reduced ammonia production at Yara’s plants in the
quarter.
The company
highlighted the margin improvement for the Clean Ammonia segment, reporting a
net $900 million improvement despite gas cost increases amounting to more than
$1 billion.
For Industrial
Solutions, second-quarter EBITDA excluding special items was $57 million higher
than a year ago, mainly due to strong margins in Brazil and higher market
prices in Europe reflecting increased production costs and supply shortages due
to sanctions on Russia and Belarus. Second-quarter deliveries were flat on a
year earlier, at 1.86 million mt.
Yara on July 19
published its first Green Financing Framework, rated medium green by CICERO, a
green bond rating service.
Potential
financing proceeds will be used for eligible green projects such as green
ammonia, premium fertilizer production assets, and carbon capture and storage
projects, the company said.
It sees these
green projects creating substantial environmental benefits by decarbonizing the
food chain, including fertilizer production and application, and by limiting
the need to expand farmland.
For the first half
of 2020, the company posted a 192% increase in net income attributable to
shareholders of the parent company of $1.61 billion ($6.31 per share) on
revenue of $12.37 billion, up from the year-ago $551 million ($2.30 per share)
and $7.09 billion, respectively.
Six-month EBITDA
excluding special items increased 107%, to $2.82 billion versus the prior year
$1.36 billion, while revenue was up 74%. First-half operating income was $2.26
billion, compared with the year-ago $799 million.
Yara said its
resilient business model continues to generate robust returns, leading to
strong dividend capacity going forward, in line with the company’s capital
allocation policy. The company paid dividends of $796 million in the second
quarter, and the Board will consider further cash returns in connection with
third quarter results.
Yara
Production and Deliveries
‘000 mt
2Q-2022
2Q-2021
1H2022
1H2021
Production1
Ammonia
1,688
1,891
3,411
3,684
Finished
fertilizer and industrial products (excluding bulk blends)1
4,466
4,983
9,328
10,040
Yara Deliveries
Ammonia
trade
404
589
847
1,047
Fertilizer
5,793
7,347
11,916
14,198
Industrial
product
1,862
1,846
3,663
3,615
Total deliveries
8,060
9,782
16,426
18,860
1
Including Yara share of production in equity-accounted investees, excluding
Yara-produced blends
Yara
Deliveries
‘000 mt
2Q-2022
1Q-2021
1H2022
1H2021
Crop Nutrition Deliveries
Urea
1,317
1,802
2,695
3,170
Nitrate
817
1,173
2,232
2,764
NPK
2,043
2,281
4,124
4,729
CN
427
470
849
946
UAN
314
378
616
761
DAP/MAP/SSP
191
335
292
482
MOP/SOP
300
516
512
665
Other
products
332
392
595
680
Total Crop Nutrition Deliveries
5,793
7,347
11,916
14,198
Europe Deliveries
Urea
162
264
346
557
Nitrate
606
765
1,600
1,921
NPK
364
470
954
1,394
CN
98
126
191
261
Other
products
346
407
734
819
Total Deliveries Europe
1,576
2,032
3,825
4951
Americas Deliveries
Urea
499
787
1,118
1,418
Nitrate
197
304
509
670
NPK
1,292
1,306
2,450
2,421
CN
281
299
553
594
DAP/MAP/SSP
179
321
262
429
MOP/SOP
281
487
462
606
Other
products
279
336
451
583
Total Deliveries Americas
3,009
3,841
5,804
6,721
North
America
833
1,064
1,738
2,022
Brazil
1,755
2,213
3,243
3,678
Latin
America excluding Brazil
421
564
824
1,021
Africa & Asia Deliveries1
Urea
655
750
1,231
1,196
Nitrate
68
103
123
173
NPK
387
504
720
914
CN
48
46
105
91
Other
products
51
70
108
151
Total Deliveries Africa & Asia
1,209
1,474
2,287
2,525
Asia
966
1,151
1,835
1,962
Africa
243
323
451
563
Industrial Solutions Deliveries
Ammonia2
125
132
258
283
Urea2
366
410
746
807
Nitrate3
313
298
633
578
CN
49
48
101
97
Other
products5
439
420
809
826
Water
content in industrial ammonia and urea
570
537
1,116
1,024
Total Industrial Solutions Deliveries
1,862
1,846
3,663
3,615
1 The
Africa and Asia business also includes Oceania
2 Pure
product equivalents
3
Including AN Solution
4
Including sulfuric acid, ammonia, and other minor products
The European
Commission (E.C.) on July 20 announced that it is planning to temporarily suspend
import duties of 5.5% and 6.5% on nitrogen-based inputs such as ammonia and
urea for the production of nitrogen fertilizers until the end of 2024, as a
means to support food production and keep prices in check in response to the
fallout of the war in Ukraine.
The Commission’s
measures are aimed at “lowering costs for E.U. producers and farmers” and
helping “increase the stability and diversification of supply by fostering
imports from a wider range of third countries, while excluding Russia and
Belarus from the suspension of tariffs.”
However, the Bloc’s farmers do not believe the measures are sufficient.
Brussels-based
Copa-Cogeca, which represents E.U. farmers and agri-cooperatives, in a July 20
statement welcomed the E.C’s move to suspend conventional tariffs for urea and
anhydrous ammonia, describing it as “a step in the right direction.” But
the organization noted the move did not include suspending conventional duties
on key fertilizers used directly by farmers i.e., UAN, DAP, MAP, and NPK, or
antidumping duties on UAN imports from Trinidad and Tobago and the U.S.
“This
approach still protects European fertilizer producers to their advantage and
will not provide an easy fix for farmers,” Copa-Cogeca said.
Copa-Cogeca called on the Commission to suspend antidumping duties on UAN imports from Trinidad and Tobago and the U.S., and conventional tariffs on fertilizing products used by European farmers.
The organization
said only such an ambitious measure could make those markets more dynamic and
bring down the prices paid by farmers in the long term.
“European farmers
are now facing the dual risk of skyrocket high mineral fertilizer prices and
shortages, severely affecting not only their incomes but also the E.U.s food
production and global food security,” Copa-Cogeca said, noting that its members
already are worried about the delay experienced in the new fertilizer
purchasing campaign.
BHP Group Ltd.,
Melbourne, said it is working to bring first production at its Jansen potash
project in Saskatchewan forward to calendar 2026, according to an Operational
Review statement for the year to June 30, 2022, published on July 19.
The mining group
previously was targeting first production for calendar 2027, but in May
revealed that it was looking at options to bring forward first production into
2026 (GM May 20, p. 1; May 6, p. 36).
The mining group
reported that the Jansen shaft project was completed in the June 2022 quarter
and the US$5.7 billion Jansen Stage 1 is tracking to plan, with activities
progressing at the port and at the Jansen site.
The US$5.7 billion
Jansen Stage 1 is currently 8% complete. On completion, it will have capacity
to produce 4.35 million mt/y of potassium chloride.
BHP, as previously
reported, is continuing to assess options to accelerate Jansen Stage 2, which
would add another 4 million mt/y of capacity.
OCP
Africa SA’s fertilizer
blending plant currently under construction in Rwanda is expected to begin
operations in May next year, according to a report this week by Rwanda’s New Times.
The plant, located
in Bugesera Industrial Park in the country’s Eastern Province, will have capacity
to produce 100,000 mt/y of blended fertilizers. It will operate as the Rwanda Fertiliser
Co. (RFC), which is a joint venture between OCP Africa, a fully-owned
subsidiary of Morocco’s OCP Group SA, and the Rwandan government. The jv was
established in August 2018 (GM Aug.
17, 2018).
Completion of the
project originally was targeted for the end of 2019 (GM May 24, 2019), and according to the report, has been delayed by
the need to switch construction contractors due to alleged problems with the
original contractor.
The cost of the
plant has been put at an estimated $38 million. It will produce, market, and
distribute tailor-made fertilizers best suited for Rwandan soils.
Meanwhile, the OCP
Group has donated 15,000 mt of DAP to Rwanda, and has committed to supply the
country with an additional 17,000 mt of DAP at a discounted price, according to
a report this week by All Africa Global
Media. The report cited Rwanda’s Minister of Agriculture and Animal
Resources, Gerardine Mukeshimana, in an interview with the New Times.
The minister said
the contribution was important “especially in this period when fertilizer
costs are high, mainly as a result of the Russia-Ukraine conflict and rising
transport costs associated with the COVID-19 pandemic.”
According to the
report, 5,000 mt of the donated DAP will be free starting stock for the new
fertilizer blending plant, while 10,000 mt will be used as a strategic
fertilizer reserve.
Mukeshimana was
visiting the construction site of the new fertilizer blending plant to assess
its progress.
Disclaimer of Warranty
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.
