Duties to Remain on US Imports of Chinese AS

The US International Trade Commission (USITC) on Jan. 20 determined under a five-year sunset review that revoking the existing antidumping and countervailing duty orders on ammonium sulfate from China (GM Feb. 10, 2017) would be likely to lead to continuation or recurrence of material injury within a reasonably foreseeable time.

As a result of the Commission’s affirmative determinations, the existing orders on imports of this product from China will remain in place for the next five years.

In the 5-0 decision, Chairman David S. Johanson and Commissioners Rhonda K. Schmidtlein, Jason E. Kearns, Randolph J. Stayin, and Amy A. Karpel voted in the affirmative.

The Commission also voted 5-0 on Feb. 8, 2017, that domestic producers of ammonium sulfate were materially injured or threatened with material injury by reason of imports from China (GM Feb. 10, 2017). This affirmative determination paved the way for the US Department of Commerce (DOC) to issue antidumping and countervailing duty orders on ammonium sulfate imports from China at rates previously set by the DOC (GM Jan. 13, 2017).

Those rates included a dumping margin of 493.46% and a countervailable subsidy rate of 206.72% for all Chinese producers. The orders went into effect March 13, 2017.

PCI Nitrogen LLC, an ammonium sulfate manufacturer in Pasadena, Texas, filed the initial antidumping and countervailing duty petitions against the Chinese imports in May 2016 (GM May 27, 2016). In those petitions, PCI said Chinese imports had increased by 682% from 2013 to 2015, and Chinese producers’ share of the US market had increased significantly at the expense of US producers.

The petitions also said that Chinese imports were underselling US producer prices by significant margins, and that this underselling resulted in lower revenues and in material injury to the domestic industry. It also alleged that significant new capacity additions in China and other factors also indicated a threat of future injury to the domestic industry.

US ammonium sulfate imports from China grew from 35,888 st, or 11.2% of total imports in fertilizer year 2012-13, to 341,455 st, or 57.6% of total imports in fertilizer year 2015-16. Chinese imports rose during that time due in part to China’s rising caprolactam capacity, according to sources.

US Ammonium Sulfate Imports

  Y15-16 Y14-15 Y13-14 Y12-13
China   341,455 273,839 147,398 35,888
All   593,249 505,583 428,935 319,102

Source: US DOC in short tons

More recently, while China in 2022 cut back DAP and urea exports, it did not do so for ammonium sulfate, and actually increased exports of the product. Chinese ammonium sulfate exports went up 24%, to 8.8 million mt in 2022 from 2021’s 7.1 million mt, according to Trade Data Monitor. Major buyers in 2022 included Brazil at 2.6 million mt, Vietnam at 730,000 mt, and Turkey at 703,000 mt.

The Commission’s public report Ammonium Sulfate from China (Inv. Nos. 701-TA-562 and 731-TA-1329 (Review), USITC Publication 5402, February 2023) will be available Feb. 22, 2023, and contain the views of the Commission and information developed during the review. It may be accessed on the USITC website at: https://www.usitc.gov/commission_publications_library.

Arianne Phosphate – Management Brief

Arianne Phosphate, a development-stage phosphate mining company advancing its Lac a Paul project in Quebec, on Jan. 24 said its Board of Directors has named Marco Gagnon as Chairman, replacing Dominique Bouchard. The company said Bouchard will remain on the Board, but has stepped away as Chairman for personal reasons.

Arianne said Gagnon is a professional geologist with 30 years of management experience within the Canadian mining industry. Since 2004, he has held senior management positions including President and CEO of Adventure Gold, a company acquired by Probe Gold, where he currently serves as Executive Vice President and a member of their Board. Gagnon has served on the Board of Arianne since 2011.

The company also said that Raef Sully, who was appointed as an advisor to Arianne last year, will join its Board. Sully most recently served as Executive Vice President of Nutrien Ltd. and was CEO of their phosphate and nitrogen divisions.

Kropz Plc – Management Brief

London-based junior phosphate producer South Africa’s Kropz Plc on Jan. 16 announced the appointment of Louis Loubser, 43,to the Board of the company as CEO and Executive Director with immediate effect.

As previously announced by the company, former CEO Mark Summers last July decided to step down from the position, but remained with Kropz under a short-term consulting agreement in order to assist with a handover to the new CEO and ensure continuity of operations across the company.

Spain’s Técnicas Reunidas Secures FEED/OBE and EPC Contracts for KazAzot’s New N Complex

Técnicas Reunidas SA, a Madrid, Spain-based general contractor, reported it has been selected by KazAzot JSC through a front-end engineering design/open book estimation (FFED/OBE) contract for the Kazak company’s ammonia and ammonium nitrate (AN) new nitrogen fertilizer complex at the Caspian Sea port of Aktau.

The initial FEED/OBE contract will be followed by an agreement for the construction of the plant by Técnicas Reunidas through an engineering, procurement, and construction (EPC) contract once the FEED is finalized and financing closed, the Spanish firm said in a Jan. 23 media statement.

KazAzot in December signed a Memorandum of Cooperation (MOC) with the Freeport Economic Zone Seaport of Aktau to build a new ammonia, urea, and AN production complex (GM Dec. 16, 2022).

The proposed new complex is planned to have production capacities of 660,000 mt/y of ammonia, 577,500 mt/y of urea, 395,000 mt/y of nitric acid, and 500,000 mt/y of AN, according to Técnicas Reunidas.

With a total of investment of $1 billion, the new production plant will be built adjacent to KazAzot’s existing production facilities. The producer has existing capacity at Aktau for 0.2 million mt/y of ammonia and 0.4 million mt/y of AN, as well as nitric acid capacity, according to Green Markets’ database.

Técnicas Reunidas said the engineering design under the FEED OBE contract will require about 200,000 engineering hours and is expected to be completed in 2023.

K+S to Acquire 75% Stake in Distribution Partner in South Africa

K+S Group has agreed to acquire a 75% stake in the fertilizer business of Commodities Holdings (Pty) Ltd. (ICH), a South African trading company, the Kassel-based company announced on Jan. 26.

The new business will operate under the name Fertiva (Pty) Ltd. The balance 25% of the shares in Fertiva will be held by two former ICH shareholders who previously managed the fertilizer business at ICH, and who now will also form part of the Fertiva management team, K+S said in a Jan. 26 media statement.

K+S did not comment on the transaction price.

ICH already has been distributing K+S fertilizers in the southern part of Africa for more than 40 years, as well as products from other manufacturers. Sales volumes of ICH’s fertilizer business in the last financial year (as of June 30, 2022) totaled approximately 543,000 mt of fertilizer, according to K+S.

“With this acquisition, we are further promoting the expansion of our core business and at the same time strengthening our activities in South and East Africa,” said the head of K+S’ Agriculture customer segment, Josef Wiebel.

K+S said in the future, Fertiva will constitute a distribution network with the already existing K+S Group companies in Kenya and Uganda, strengthening the German group’s market presence in Africa’s Sub-Saharan region.

The two parties signed the agreement on Jan. 25. The closing of the transaction remains subject to the fulfilment of a number of conditions, including obtaining regulatory approvals. The closing is targeted during the second quarter of this year.

Trade Groups Sue Over New WOTUS Definition

A coalition of 17 trade groups filed a lawsuit against the US Environmental Protection Agency (EPA) and the US Army Corps of Engineers on Jan. 18 challenging the agencies’ new Waters of the United States (WOTUS) definition.

Officially announced on Dec. 30 (GM Jan. 6, p. 1), the new rule claims to restore protections that were in place prior to 2015 under the Clean Water Act (CWA) but with “updates to reflect existing Supreme Court decisions, the latest science, and the agencies’ technical expertise.” The rule was published in the Federal Register on Jan. 18.

According to the lawsuit, however, the rule “adopts an unworkable definition of WOTUS that conflicts with the CWA, the Constitution, and Supreme Court precedent.” Chief among a long list of criticisms is the allegation that the rule relies on a vague “significant nexus” standard that potentially brings a wide range of waters and land under CWA jurisdiction.

“Instead of providing much-needed clarity to the regulated community…all the Rule makes clear is that the agencies are determined to exert CWA jurisdiction over a staggering range of dry land and water features – whether large or small; permanent, intermittent, or ephemeral; flowing or stagnant; natural or manmade; interstate or intrastate; and no matter how remote from or lacking in a physical connection to actual navigable waters,” the lawsuit claims.

EPA tried to clarify “significant nexus” in the new rule by adding more criteria to the test, Bloomberg Law reported, including a water body’s distance to a navigable water, the frequency and duration of water flow, and a smaller body’s contribution of flow and sediment to a navigable water body. These factors determine whether a smaller water body has a “material influence” on a larger one, and therefore falls under CWA protection, the new rule states.

EPA also included a new framework for evaluating waterway and wetlands protections, including whether the wetlands are “relatively permanent” and if the waters are “similarly situated” with other jurisdictional waters in a region or in their “catchment area.”

The lawsuit, however, claims the new rule is a “sweeping and unwieldy regulation” that “imposed impossible and unpredictable burdens” on landowners by requiring them to “assess not only their own land, but also vast expanses of land beyond their own holdings, using multiple vaguely defined connections to potentially remote features, in an effort to determine if their land is regulated under the CWA.”

“The rule purports to establish the agencies’ jurisdiction over a wide range of features that are not properly WOTUS under the CWA or under the Supreme Court’s interpretations of the Agencies’ jurisdiction,” the lawsuit states. “That includes many drainage ditches, dry desert washes, intermittent or ephemeral channels, non-navigable interstate ponds, or any feature with any of a myriad of physical or non-physical connections to navigable or interstate waters on which they are deemed by the agencies to have a ‘material influence’ using vague and undefined factors.”

The lawsuit further argues that the new WOTUS definition “strips the states of their primary authority and traditional powers over land and waters that Congress intended them to retain.” In addition, the lawsuit claims that EPA and the Corp conducted a flawed cost-benefit analysis that “dramatically” underestimates the costs imposed by the rule on landowners and small businesses.

The Supreme Court is expected to rule this year on Michael Sackett v. EPA, a pivotal WOTUS test case involving a couple that for 15 years has been prevented from building a home on their 0.63-acre property in Priest Lake, Idaho, because EPA claims part of the property contains wetlands and is therefore subject to regulation under the CWA. Oral arguments were presented in October, and the Supreme Court is expected to issue a ruling early this year.

According to a federal regulatory agenda posted on Jan. 4, EPA plans to refine the new WOTUS definition after the Supreme Court’s ruling in the case, with the final rule expected to be published in the fall.

The plaintiffs listed in the lawsuit include the American Farm Bureau Federation (AFBF); American Petroleum Institute; American Road and Transportation Builders Association; Associated General Contractors of America; Leading Builders of America; Matagorda County Farm Bureau; National Association of Home Builders; National Association of Realtors®; National Cattlemen’s Beef Association; National Corn Growers Association; National Mining Association; National Multifamily Housing Council; National Pork Producer Council; National Stone, Sand and Gravel Association; Public Lands Council; Texas Farm Bureau’ and US Poultry and Egg Association.

“Farmers and ranchers share the goal of protecting the resources we’re entrusted with. Clean water is important to all of us. Unfortunately, the new WOTUS rule once again gives the federal government sweeping authority over private lands,” said AFBF President Zippy Duvall in a Jan. 19 statement. “This isn’t what clean water regulations were intended to do. Farmers and ranchers should not have to hire a team of lawyers and consultants to determine how we can farm our land.”

Grupa Azoty Commissions Second Concentrated Nitric Acid Unit at Tarnów

Polish fertilizer and chemicals producer Grupa Azoty SA has launched a new unit for the production of concentrated nitric acid with a design output of 40,000 mt/y, doubling its existing capacity.

This is a second production line for above 98% concentrated nitric acid now operating at the company’s Tarnów production site, and has brought the Tarnów site’s total annual capacity for concentrated nitric acid to 80,000 mt, Azoty said in a Jan. 24 media statement.

As Poland’s only producer of concentrated nitric acid, the project is key to ensuring supplies of input materials for the manufacture of fine chemicals, the company said.

Bolivia Plans Tender for Studies on Second Urea Plant

Bolivian state-owned YPFB plans a tender this year for engineering and design studies for a second urea plant that could double current production, YPFB President Armin Dorgathen said in a statement. The company expects the cost of the pre-investment stage to be US$1.29 million, with $1.11 million to be spent in 2023.

Last year, plans were also announced that the country would build a 60,000 mt/y NPK plant in central Cochabamba province (GM July 15, 2022).

The urea plant operating in Bulo Bulo in Cochabamba province currently produces 365,000 mt/y, according to Dorgathen, though earlier production targets have been higher – 590,000 mt/y and 2,100 mt/d (GM Sept. 10, 2021). He said Bolivia replaced 99% of fertilizer imports due to domestic urea production, without specifying a timeframe.

Dorgathen said the company will seek to boost exports with the second plant. The Bulo Bulo plant, Bolivia’s only nitrogen plant, has previously exported to five countries – Brazil, Argentina, Paraguay, Peru, and Uruguay.

The plant began operations in September 2017, but has suffered a series of operational problems since start-up.

This latest production stoppage – arguably the most serious and far-reaching – began in November 2019 (GM Jan. 31, 2020) and lasted until September 2021. According to comments in March 2021 by YPFB Executive President Wilson Zelaya, the shutdown of operations at the plant was not done according to proper procedures, and resulted in some damage to equipment. He said an adequate hibernation of the plant was not undertaken, nor was proper maintenance performed (GM March 26, 2021).

Many blamed the alleged use of unqualified personnel for the damage at the plant amid the country’s political crisis in November 2019, which saw the resignation of controversial President Evo Morales and the assumption to the presidential role of Jeanine Áñequalz Chávez, which also was not without controversy.

After a landslide win for the Movement for Socialism the following year and the installment of new President Luis Alberto Arce Catacora on Nov. 8, 2020, work began on rehabilitating and reactivating the Bulo Bulo plant.

Saudi Arabia’s Investment Ministry, India’s UPL Ink Deal for Production Unit

Saudi Arabia’s Ministry of Investment has signed an investment agreement with India’s UPL Ltd. to manufacture specialized and agricultural chemicals in Saudi Arabia, with a value estimated at $1 billion, according to a Saudi Gazette report on Jan. 21.

Mumbai-based UPL is a global provider of crop protection and other specialty agricultural chemicals and biosolutions.

The agreement was signed on the sidelines of the participation of Saudi Arabia’s delegation in the World Economic Forum 2023, held in Davos, Switzerland, and is part of Saudi Arabia’s efforts to support investment in economic diversification.

Kropz Makes First Bulk Sale from Elandsfontein Phosphate Project

South Africa’s Kropz Plc reported that it has made its first sale and bulk shipment of phosphate concentrate from the Elandsfontein Phosphate project. The sale and shipment comprised 33,000 mt of product, the London-based firm said in a Jan. 23 statement.

Kropz said the tons were being sold “at a discount to current market prices,” but has not disclosed where the shipment is heading, or the buyer.

The company first announced the sale in December, and at the time said it was building up stock for the shipment (GM Dec. 9, 2022).

The tons have been generated throughout the commissioning and ramp-up period at its Elandsfontein plant, where the first concentrate samples were produced in the fourth quarter of 2021 (GM March 25, 2022). Sales to smaller local customers in South Africa began last year.

The plant has a targeted design processing capacity of some 1 million mt/y, according to Kropz’s website. Product for export is transported by road and rail the 43 km to the West Coast port of Saldanha, one of Africa’s biggest ports.

Earlier this month, the company reported an update to the mineral resource estimate for the Elandsfontein Phosphate project, now providing for a proven reserve of 7.31 million mt at 10.71% P2O5.The update follows additional infill drilling, relogging of historical cores and mapping of ore exposures as intersected within the current mining horizon.

Kropz owns a majority 74% stake in the project.

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