AMMONIA
AMMONIA
U.S. Gulf/Tampa: The import and NOLA markets were quiet last week. Most of the attention in the ammonia market was overseas or inland U.S. In the Black Sea, buyers were anxiously awaiting news of a drop. And in the inland U.S., sellers appeared determined to keep prices up as the prices of urea and UAN soared.
Natural Gas: The final May closing price, which was recorded April 28, was $11.280/mmBtu. It was reported as the highest contract expiration price since the January 2006 contract.
Correction: The closing NYMEX natural gas price for April should have read in Green Markets as $9.578/mmBtu, not $9.572/mmBtu. This was the April close on March 27, and it first appeared in the issue dated March 31. The May price posted on March 27 was $9.687/mmBtu, not $9.680/mmBtu.
Eastern Cornbelt: The region continued to experience fieldwork delays related to wet conditions, but some planting progress was reported last week. Lots of preplant ammonia reportedly still needs to be applied in Illinois and Indiana.
The spot market for ammonia continued to be quoted at $715-$730/st FOB regional terminals, although postings were higher. One supplier moved its reference levels last week to $755-$760/st FOB terminals in Illinois and Indiana for prompt tons, and there were reports of another offering fall prepay for as high as $815/st FOB. Still another was offering forward contract ammonia for June at $760-$770/st FOB in the region.
Western Cornbelt: The anhydrous ammonia market was tagged at $700-$730/st FOB regional terminals for spot market tons last week, with one supplier referenced at $740/st FOB in Nebraska, $745/st FOB in Iowa, and $750/st FOB in Missouri. Agrium’s April 28 ammonia postings included $700/st FOB Hoag, Neb., and $705/st FOB Early, Garner, and Whiting, Iowa; Mankato, Minn.; and Greenwood, Neb. Agrium’s ammonia postings in the Leal, Beulah, Velva, and Grand Forks sales area in North Dakota firmed on May 1 to $860/st FOB and $880/st DEL.
Southern Plains: The ammonia market was up from last report as well. Sources quoted ammonia pricing in a broad range at $600-$675/st FOB, with the low out of Oklahoma production points and the upper end to dealers FOB Kansas pipeline terminals. One Kansas source said the next big fertilizer push in his territory would be ammonia on the grain sorghum crop.
Agrium’s anhydrous ammonia postings firmed on April 28 to $675/st FOB Clay Center, Kan.; $670/st FOB Conway, Kan.; $665/st FOB Mocane, Okla.; and $645/st FOB Borger, Texas. The company’s delivered postings from the Borger location moved on that date to $670/st in Texas north of Interstate 40, and $675/st in Texas and Oklahoma south of Interstate 40.
South Central: The anhydrous ammonia market was pegged at $610-$660/st FOB regional terminals, with the low for spot tons FOB Memphis and the upper end for fall prepay.
Western U.S.: Agrium’s anhydrous ammonia postings firmed on May 1 to $925/st rail-DEL in Oregon, Washington, and northern Idaho; $945/st truck-DEL in Oregon and Washington east of the Cascades, and in northern Idaho; and $950/st truck-DEL in Montana and northern Wyoming. Agrium’s aqua ammonia postings firmed on May 1 to $236/st FOB Central Ferry and Finley, Wash.
Black Sea: Asian sources report prices quoted by traders as low as $430/mt FOB, but no one could confirm any business done at that level. The problem with nailing down the new lower price levels, said one trader, is that the Ukrainian government has not yet lowered the KIP. The current official lowest price was still at $480/mt FOB, as most of the world got ready to take a long international Labor Day holiday break.
Bruce Waterman, Agrium Inc. senior vice president, finance, and chief financial officer (CFO) has been chosen as Canada’s CFO of the Year?äó for 2008. Waterman joined Agrium in 2000, and has more than 25 years of experience as a financial executive. He will be honored at a gala dinner in Toronto May 29. The award is presented annually by Financial Executives International Canada (FEI Canada), PricewaterhouseCoopers LLP, and The Caldwell Partners International. The award, which recognizes the quality, insight, direction, and leadership of Canada’s senior financial executives, was begun in 2003. Waterman is the first fertilizer company CFO to win the award.
Lateegra Gold Corp. has engaged Stephen Butrenchuk, P.Geol., to review and author a mineral project resource disclosure and provide consulting services involving the recently acquired Fernie Formation phosphate claims (GM April 28, p. 12). Lateegra describes Butrenchuk as one of the leading authorities on phosphate deposits in British Columbia. He began his career with Cominco Ltd., where he spent 16 years as an exploration geologist. He has been contracted to complete a detailed NI 43-101 technical report on the company’s current claim holdings, which will include re-evaluation of historical drilling completed in the area by Cominco, Imperial Oil, Formosa Resources, and First Nuclear Energy.
Viterra Inc. has announced that its board of directors has elected Thomas Birks as chairman. He has been a Viterra director for three years. Birks is president of Birinco Inc., a small merchant bank, and previously served as president of Henry Birks and Sons Ltd. in Montreal. He graduated from McGill University with a Bachelor of Arts and holds an MBA from the Harvard Business School.
Birks replaces Terry Baker as Viterra’s chair. Baker will remain on the board as a director.
Toronto-Marsulex Inc. said April 22 that its Marsulex Environmental Technologies (MET) has been awarded a contract by Sunbury Generation LP to design, supply, and install a wet flue gas desulfurization system at its 400 megawatt Sunbury Power Plant complex in Shamokin Dam, Penn. The contract value is over $60 million. Start-up of the new system is slated for January 2010.
Oslo-Yara International ASA has reached agreement with the Brenntag Group to sell certain chemical supply activities at its Köping and Tertre sites as part of the commitments agreed to with the European Union for approval of its acquisition of Kemira GrowHow Oyj. One of the commitments concerned the divestment by Yara of its AN solution, aqueous ammonia, and weak nitric acid supply activities conducted from the Köping production site in Sweden, and the AN solution, aqueous ammonia, weak nitric acid, and concentrated nitric acid supply activities conducted from the Kemira GrowHow production site at Tertre, Belgium. In each case, related production and distribution assets form part of the sales package. Yara has reached agreement with the Brenntag Group to sell the Köping supply activities to Brenntag Nordic AB and the Tertre supply activities to Brenntag NV. The European Commission has approved Brenntag as a purchaser and the form of the agreements. As a result, a major step has been taken towards the fulfillment of the commitments to the European Union related to the approval of Yara’s acquisition of Kemira GrowHow Oyj. Closing is conditional on regulatory approvals and is expected to occur during the second quarter of 2008. The sale will result in a gain of EUR 11 million, which will be booked in Yara’s second quarter results.
St. Helens, Ore.-A tiny leak in a safety relief valve atop a 500-ton tank at the Dyno Nobel nitrogen fertilizer plant here released between 300 and 700 pounds of anhydrous ammonia over nearly five days without causing any serious problems, according to Plant Manager Greg Godfrey. There were no injuries, no plant or community evacuations, and no interruptions in the operation because of the leak, which took place between April 23 and April 28. A truck driver noticed the odor and alerted emergency responders. “We’re still calculating the amount,” Godfrey told Green Markets. “But data from our instrumentation indicate that the leak began on that Wednesday at 11 a.m. and wasn’t detected until 2 a.m. Monday.” Godfrey said it was in one of two safety valves that are part of the overpressure system, which was reconditioned by a certified service shop just two weeks prior to the leak. He described the leak as so small that it didn’t trigger the alarm system and was not obvious to plant service personnel, who are on duty around the clock. Godfrey figures the fumes dispersed on their own until a change occurred in the weather, when a truck driver passing by smelled ammonia reported it to the Columbia River Fire and Rescue. The plant night supervisor shut off the leak before the emergency crews arrived. Godfrey said that once a week an operator goes several stories up to the top of the tank to perform a routine inspection, but wasn’t scheduled to make the climb until after the leak was found. Several employees who live less than a half mile away detected nothing, and the same was true for those at a utility office and quarry just across the street. Godfrey said the ammonia is used primarily to produce UAN, but some is sold directly to farmers from the plant, which employs seven. The leak also was reported to the Oregon Dept. of Environmental Quality, where a spokeswoman said that because the incident was accidental the department will not take action against the company.
Pecatonica, Ill.-About 2,000 pounds of anhydrous ammonia were released from a nurse tank when a trailer hitch broke off from its tow vehicle and the applicator hose snapped April 30 about 2 p.m. in a farm field near U.S. Route 20, according to the Winnebago County sheriff’s office. There were no injuries, no road closures, and no evacuations, reported Sheriff’s Sgt. Brian Harrison. Harrison told Green Markets that farmers down wind were notified and the fumes were kept away from the highway by favorable winds. “We issued an advisory for about three hours, but that’s all,” Harrison said. “It was not on a highway and not in a populated area and if it had to happen this was a good place for it.” Pecatonica firefighters closed the valves on the ammonia trailer and declared the area to be safe, and Winnebago County emergency services disaster agency remained on alert for the short time. The incident did recall last April, when more than 38,000 pounds of anhydrous ammonia leaked from a semi trailer truck in Seward, forcing the evacuation of the small town of less than 300 people.
Bargersville, Ind.-Local farm supplier Roy Umbarger & Sons Inc. is beefing up its security following an incident late on April 21. Two anhydrous ammonia nurse tanks located separately on company property were tampered with, and the contents of one of the tanks was nearly fully released on this small rural community. Authorities report that there were no serious injuries, and only a few residents voluntarily left their homes. Assistant Police Chief Todd Bertram said a paramedic on the scene and a motorist driving by were treated at nearby hospitals. He said a lot of others were unharmed when they drove through the vapor cloud, which was controlled by a Franklin hazmat crew called in to spray down the area. “This was no theft (by meth-makers) because they wouldn’t be opening the tank valve three turns as was the case here,” Bertram suggested. “It almost emptied a whole tank.” He said a couple of days earlier a liquid clay tank was hit in the same manner, indicating both were targets of vandalism. Rowana Umbarger, wife of one of the owners, said from now on Umbargers will be keeping the tanks outside of town at the filling location and brought into town only for weighing. Surveillance cameras also will be installed. She said the fact that her husband, R. Martin Umbarger, is a National Guard major general and state adjutant general is a coincidence and had nothing to do with the incident. The possibility was suggested by a local newspaper columnist who wrote that “for the conspiracy theorists in the audience, (Umbarger’s military position) means that there could easily be a political connection to this vandalism.”
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