Dry Fertilizer Barge Rates
| 7/9/2021 | Last Week | |
| Memphis | 11.00 | 11.00 |
| St. Louis | 11.00 | 11.00 |
| Peoria | 15.00 | 15.00 |
| Cincinnati | 16.50 | 16.50 |
| St. Paul | 19.50 | 19.50 |
| Catoosa/Inola | 20.50 | 20.50 |
All Posts from July 9, 2021
CHS 3Q Income Up 180.2 Percent
CHS Inc. on July 8 reported net income attributable to CHS of $273.6 million for the third-quarter ending May 31, 2021, compared to the year-ago $97.6 million, an increase of 180.2 percent. Significant year-over-year earnings growth was reported for all business segments, including Energy, Ag, and Nitrogen Production. Total revenues were $10.9 billion, up 50.9 percent from the year-ago $7.2 billion.
“Robust performance across CHS resulted in a very strong third quarter,” said Jay Debertin, CHS President and CEO. “Strong global demand in agricultural markets and the hard work we have been doing to gain efficiencies across our supply chain led to higher volumes in nearly every business area, significantly improving our Ag segment earnings compared to the prior year’s third quarter. We also are seeing increasing momentum in pandemic recovery as restrictions ease and vaccination efforts progress, which has had a favorable impact on our Energy segment results and overall performance.”
Third-quarter Ag income was up 47 percent, to $140.1 million from the year-ago $95.4 million. Ag revenue moved up to $9.2 billion from $6.3 billion. CHS said strong global demand drove commodity prices higher and improved trade relations between the U.S. and foreign trade partners, leading to continued higher volumes for grain and oilseed, which significantly improved Ag segment earnings compared to the prior year’s third quarter. Lower volumes of feed and farm supplies were partially offset by increased volumes for agronomy products, stemming from stronger demand due to favorable weather conditions, compared with the previous year’s third quarter. Higher overall margins were partially offset by mark-to-market losses for certain processing and food ingredients products, which the company expects to reverse over time.
Nitrogen Production income was $46.6 million, up from the year-ago $23.5 million, with the company citing increased sale prices of urea and UAN.
Energy income was $4.9 million on revenue of $1.81 billion, up from the year-ago loss of $54.8 million and revenue of $960.4 million.
For the nine months ended May 31, 2021, CHS reported net income of $304.7 million on revenue of $28 billion, versus $401.9 million and $21.5 billion, respectively.
Nine-month Ag income was $237.2 million on revenue of $23.6 billion, up from the year-ago $60.6 million and $17.2 billion, respectively, while Nitrogen Production income was $62.3 million versus $45.7 million. Energy saw a nine-month loss of $116.9 million on revenue of $4.6 billion, compared to the year-ago positive $246.3 million and $4.6 billion, respectively.
Reflecting on the strong performance, the CHS Board of Directors approved $50 million in additional equity redemptions to member cooperatives and individual owners since the December 2020 CHS Annual Meeting. The increase is incremental to $33 million in approved equity redemptions announced at the 2020 annual meeting, for a total of $83 million in planned owner equity redemptions in fiscal 2021. A distribution of $30 million in cash patronage was also made to owners in early calendar 2021, based on business transacted with CHS in fiscal 2020.
Belaruskali Workers Call for Tougher E.U. Sanctions, Report Says
Belaruskali’s workers have called for tougher European Union (E.U.) sanctions against the company, claiming the current sanctions hardly harm the ability of the potash producer to work in the European bloc.
According to a statement cited by the Brussels-based EUobserver on July 5, Belaruskali’s Strike Committee said for sufficient pressure to be applied on the Belarusian regime, it is necessary to include all types of potash in the E.U. ban and all stakeholders both in Belarus and abroad. The Strike Committee also named Austrian firm SolTrade as a key partner of Belaruskali in Europe.
The E.U. on June 24 agreed to a sweeping set of sanctions against the Belarusian regime, targeting key economic sectors, and included restrictions on Belarus’ potash trade (GM June 25, p. 1).
Belaruskali workers argue that sanctions only harm the people in power in Belarus, and said President Alexander Lukashenko was already finding ways to evade even the limited sanctions, according to the EUobserver report. According to the report, these ways allegedly include changing product codes in customs papers.
The E.U. this week pledged to help Member State Lithuania handle an influx of migrants from the Middle East and Africa, which the Baltic country said is being encouraged by authorities in neighboring Belarus as part of that nation’s retaliation to the European bloc’s sanctions, according to an AP report.
Belarus’ Foreign Ministry said on June 28 Belarus would move to suspend a readmission agreement with the E.U. that is aimed to stem illegal migration, (GM July 2, p. 1). On July 2, Lithuania declared a state of emergency due to the influx of migrants across its border with Belarus.
Meanwhile, Switzerland this week widened its sanctions against Belarus, adding 78 individuals and seven organizations to its sanctions list, according to a National Post report, citing the website of Switzerland’s State Secretariat for Economic Affairs.
Switzerland first imposed sanctions against Belarus in 2006 to protest against what it called violations of the rule of law and human rights.
Ukraine’s Cabinet of Ministers on July 7 approved proposals for the application of personal economic sanctions and other sanctions against unnamed Belarusian officials, and the government subsequently agreed to the sanctions, according to a report by Ukraine news portal Bukvy.The Cabinet of Ministers will submit proposals to the National Security and Defense Council within a month,
Ukraine last year froze contact with Belarus, with which it shares a border, and joined the E.U. in condemning the elections as neither free nor fair. According to the report, the sanctions against the Minsk officials will be imposed for a three-year period.
Planned High-Speed Railway Will Not Affect K+S’s Werra Potash Mining
K+S Group, Kassel, said the planned Fulda-Gerstungen high-speed rail project will not lead to any restrictions for potash mining in the Werra region. The planned rail route will not affect future mining areas in the region, according to the conclusion of the ninth DB Netz AG participation forum in Bad Hersfeld in eastern Hesse on July 2, K+S reported in a July 5 statement.
“According to the current plans of DB Netz, there will be no branch line near Hünfeld-Michelsrombach. Consequently, the new railroad route will not affect the planned Marbach mining field, which is of great importance for the future mining of potash mining in the Werra mining district,” said K+S Werra Plant Manager Martin Ebeling.
The Marbach mining field extends from the southwestern edge of the current mining operations in the Eitratal Valley in eastern Hesse in the direction of Fulda.
Ebeling said the Marbach field opens up prospects for the company’s Werra plant until 2060.
The Werra site, with its plants in Hattorf and Wintershall in Hesse, and Unterbreizbach and Merkers in Thuringia, is K+S Minerals and Agriculture’s largest site.
Acron Announces More Upgrades at Veliky Novgorod
Acron Group, Moscow, reported that it has launched preparations for the overhaul of its Ammonia-2 unit at Veliky Novgorod in northwest Russia.
Completion is scheduled for 2023. The project will increase the unit’s operating capacity by more than 25 percent to 2,300 mt/d from 1,800 mt/d, ramping up the facility’s ammonia annual output capability by 175,000 mt.
Acron has also started a similar expansion of production capacity at its Ammonia-3 unit at Veliky Novgorod. The group awarded the revamp contracts for both units to KBR, Houston, in March (GM March 26, p. 34).
Once both projects are complete, ammonia output will increase by 375,000 mt/y, Acron said.
The group puts it current ammonia overall production capacity at Veliky Novgorod at 2.19 million mt/y (GM April 30, p. 32).
Acron said on July 5 it has also launched a large-scale overhaul of four urea units – units 1-4 – at the site. Completion of the project is scheduled for 2024 and will increase total capacity of the four units to 3,100 mt/d from the current 2,000 mt/d, boosting annual output capability by 390,000 mt.
Netherlands-based Stamicarbon, part of the Italian Maire Tecnimont Group, is the basic design and technology licensor for the projects, which will include installing a new urea synthesis facility, Acron said. The project will also reduce direct CO2 emissions by 270,000 mt/y, according to the group.
It put the total investment for the upgrades of the four urea units at $92 million.
Acron currently is completing its Urea-6+ project at the site, which will increase the unit’s capacity to 730,000 mt/y (April 23, p. 30).
Once all these upgrades are complete, the group’s Veliky Novgorod site will be able to produce over 2.3 million mt/y of urea, making Acron the largest urea producer in Europe, the group said.
Acron in May last year added urea granular capability to its production portfolio, commissioning a new 700,000 mt/y urea granulation unit at the Veliky Novgorod site (GM May 22, 2020). Hitherto, Acron had only produced urea that was prilled or rotoform.
Acron Group Urea Production Capacity
at Veliky Novgorod
| Original design capacity (mt/y) | Current design capacity (mt/y) | Future design capacity under current projects | Scheduled completion | |
| Urea units 1-4 | 360,000 (1969-1972) | 730,000 | 1,120,000 | 2024 |
| Urea-5 | 350,000 (2012) | 515,000 | 515,000 | |
| Urea-6 | 210,000 (end-2018) | 210,000 | 730,000 | 3Q 2021 |
| All six units | 1,455,000 | 2,365,000 |
The group produces ammonia at its Dorogubuzh subsidiary in Russia’s Smolensk region, but the Veliky Novgorod site is its only urea producing site.
Explosion and Fire at Romania’s Azomures’ Ammonia 3 Unit, One Worker Injured
Azomures, Romania’s largest fertilizer producer, suffered a fire following an explosion early on July 7 at its ammonia 3 unit in Tîrgu Mureş. The unit was in the last phase of the restart process following a technical overhaul, the company said in statement on July 7.
One person was injured in the incident, a 50-year old Azomures employee who sustained an upper limb fracture.
Azomures said the fire was soon extinguished and no ammonia emissions were recorded at the unit, which is now shut down. The producer said the operation of its other facilities have not been affected. It has begun an internal investigation into the incident.
The producer last week reported that a partial technical overhaul of a number of its production units, which had begun on June 1, was nearing completion (GM July 2, p. 32; June 4, p. 32). It had not indicated which of its facilities were involved in the overhaul.
Azomures since 2012 has been owned by Swiss Group Ameropa via a subsidiary. According to Azomures’ website, the Romanian company produces some 1.6 million mt/y of fertilizers, with 70 percent of annual output going to local farms. Its main products include ammonium nitrate, CAN, granular urea, and UAN, as well as NPK and NP fertilizers. Azomures also has melamine production capability.
Russia’s UMMC, Ultramar to Build AS Plant at Sredneuralsk
Russian metals and coal major Ural Mining Metallurgical Co. (UMMC) and Russian logistics company and container operator Ultra Group LLC (an Utramar Group company) have agreed to establish a plant for the production of ammonium sulfate (AS) at UMMC’s Sredneuralsk Copper Smelting Plant (SUMZ),Russia’s Itar Tass reported, citing a statement by the two companies on July 5.
The proposed plant will produce half a million mt of AS and will take three years for a full launch, according to the report, citing Ultramar CEO Andrei Bonch-Bruevich. Construction of the plant will be completed in two years, according to UMMC General Director Andrey Kozitsyn.
The total joint investment is put at about RUB6 billion (approximately $80.5 million at current exchange rates).
SUMZ is the largest copper smelter in the UMMC Group, with annual capacity of around 150,000 mt of blister copper, according to the company’s website.
Ag Growth International Inc. – Management Brief
Ag Growth International Inc., Winnipeg, announced on July 5 that Jason Tatge is the new Senior Vice President of AGI SureTrack. He will be accountable for integrating the Farmobile and SureTrack organizations, driving sales growth, and developing applications relevant to sustainability and carbon-related markets.
AGI said Tatge has led several firms within the AgTech sector over the last twenty years. He is also the co-founder and CEO of Farmobile, which AGI recently acquired in full after having been a minority shareholder since 2019 (GM July 19, 2019). Prior to Farmobile, he founded Farms Technology, an electronic marketplace designed to automate grain transaction and risk management processes by offering automated hedging algorithms accessible via smartphones and tablets.
Tatge earned a degree in Financial Economics from Gustavus Adolphus College in Minnesota and an MBA from the University of Memphis.
NeuAG, Corteva Products Mix
NeuAG LLC, Freeport, Texas, reported that its NeuAG Spray Grade Ammonium Sulfate has been approved as a tank mix partner with Corteva’s Enlist One and Enlist Duo herbicides. The NeuAG product, along with other ammonium sulfate products, will be available beginning Nov. 1, 2021, and will be produced at the BASF caprolactam facility in Freeport, Texas.
India – Management Brief
Indian Prime Minister Narendra Modi executed a major shake-up in his cabinet this week. The move brought in 15 new cabinet members and 28 ministers of state (sub-cabinet) officials.
D. V. Sadanand Gowda stepped down as Minister of Chemicals and Fertilizer just before the Prime Minister’s office announced the changes. He was replaced by Shri Mansukh Mandaviya, who will also be the Minister of Health and Family Welfare.
International traders said they were not familiar with Mandaviya. Local media described him, and many of the new cabinet members, as younger and more willing to make changes within their assigned ministries.
Modi came under harsh criticism for his handling of COVID-19 related issues, such as availability of oxygen tanks and bed space in hospitals. He also faced a large series of demonstrations in the major cities against plans to reorganize the agricultural markets. Mandaviya will be in charge of both these sensitive areas.
One international trader suggested that the changes in the cabinet might also lead to changes in leadership in the state-owned industries, such as MMTC and IFFCO. Another area that might be addressed, said a source, is adjusting responsibility for importing urea.
Currently, only MMTC and RCF are allowed to import urea for agricultural purposes. This urea qualifies for the large subsidies that have kept the price to farmers at around $72/mt. Urea for industrial use is not subject to the subsidy and can be imported by any company.
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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.
For additional details visit our Terms of Use.