Yara International ASA, Oslo, announced on Feb. 13 that it and Arab Potash Co. (APC), Amman, Jordan, have signed a memorandum of understanding (MOU) for mutual cooperation in the field of potassium nitrate production and sales. The parties will explore and evaluate the possibility of doubling the production capacity of Arab Fertilizers and Chemicals Industries (Kemapco), APC’s potassium nitrate-producing subsidiary.
Yara is targeting a minority position (30 percent) in Kemapco with a 100 percent distribution and marketing agreement. Yara notes that potassium nitrate is a key product in solutions for fertigation, a fast growing segment that Yara and Kemapco aim to develop further through this collaboration.
“With this MOU we are pleased to establish a collaboration of strategic value,” said Terje Knutsen, Yara executive vice president, Crop Nutrition. “Our farmer-centric approach means that we offer a full range of nutrients and solutions to meet farmers’ needs in all climates and for all soils. Fertigation is the combined application of water and nutrients to a crop, a mix of fertilizer and irrigation in the same application. The collaboration with Kemapco will facilitate exchange of technology and know-how, and secure access to potassium nitrate that will strengthen our fertigation offering.”
Kemapco operates a single potassium nitrate plant in Aqaba, Jordan. Production in 2017 amounted to 130,000 mt, with sales amounting to about US$105 million.
“The signing represents an important step in the plan to grow our business; we believe that our high-quality product will be a great fit for the growing potassium nitrate demand,” said Jamal Al-Sarayrah, APC board chairman. “We are pleased to have the opportunity to grow our business with Yara’s extensive sales network.”
The $200 million factory would reportedly boost Kemapco’s potassium nitrate output to 350,000 mt/y from 135,000 mt/y, according to a Bloomberg report citing the state-run Petra news agency. The new factory would be built near the current plant in Aqaba. The Petra report cited Al-Sarayrah.
Nutrien Ltd., Saskatoon, which owns 28 percent of APC via its legacy Potash Corp. of Saskatchewan Inc., is currently looking to sell its interest as part of the condition for Indian and Chinese approval of the Agrium Inc. and PotashCorp merger.