Phosphates

HOUSTON (ICIS)–The US fertilizer industry along with their agricultural counterparts were trying to assess damages and determine how long activities might be limited or even remain halted as Hurricane Helene delivered a mighty strike with intense winds and tremendous rainfall leading to historic flooding. Across several southeastern states the severity of the impacts affected plant operations and loadings with confirmed issues in Florida, Georgia and North Carolina with some damage reported at the port in Tampa, Florida, which did reopen on 29 September. There was also localized flooding within the city and surrounding communities but the fertilizer hub with its vital production, storage and logistical assets missed the full wrath of the hurricane, which had rapidly intensified before making landfall. Producer Mosaic had earlier informed that it did experience some issues with its operations in Florida as there was water intrusion at its Riverview site, which was caused by storm surge that has left the facility offline. A site cleanup must be undertaken so the operations are not anticipated to see a return to full capacity for about 10 days, but Mosaic did not respond for further comment on whether it had experienced any other impacts to its business activities. Canadian fertilizer major Nutrien said it is still evaluating the total impacts of the hurricane landfall but while its Aurora facility in North Carolina experienced heavy rainfall, the facility did not close during the event and is fully operational. The producer said it did undertake precautionary measures at other sites. “Following Hurricane Helene’s landfall last Friday, Nutrien’s Augusta, Georgia, and White Springs, Florida, facilities were shut down under safety protocols during storm-induced power failures,” said a Nutrien spokesperson. “All our colleagues are safe at these locations, but many area roads remain closed due to downed power lines and flooding. It could be several more days before a post-storm assessment is complete.” For fertilizer interests overall there was optimism that while the storm potentially wiped out what crops had not been finished in some locations, it should not have a lingering sway on upcoming demand or supply availability once flooding recedes and acreage dries as there is still plenty of acreage left to complete. As an industry source said, “I don't think it matters at all. We just need some more harvesting so farmers can think about application.” Corn harvest is now 21% complete, while soybeans have reached 26%. While September has been treading a tad slower than normal, with repeated tropical weather threats a key factor, there was sentiment that when looking ahead at October there will be more traction forward for some products. As a trader said, “I think prices will move up on UAN [urea ammonium nitrate] because of the supply disruptions but hard to say how much. Phosphate is probably the most bullish out of everything, urea doesn't really have an impact." The extent of crop damage will not be clear for at least several days, maybe longer. The concern is still that a reduction in yield means a drop in income back to the grower who then will have more pressure on how to manage upcoming input expense.

30-Sep-2024

HOUSTON (ICIS)–Canadian fertilizer developer Lara Exploration announced it has completed the expenditures required to increase its ownership interest in the Mantaro Phosphate project in Peru from 33% to 70%. As previously announced, the company had committed to investing $500,000 by the end of 2025 to gain the additional project stake. Toronto-based Lara Exploration said as part of its operational strategy it has established a new subsidiary, Fosfatos Alli Allpa, who has an objective of advancing further exploration, technical studies and eventual development. Named for its significance in the local Quechua language as "good soil” phosphates, Fosfatos Alli Allpa aims to produce and concentrate phosphate rock to meet the growing demand for natural fertilizers. The concentration of its market will initially be within the Junin region of central Peru, where the project is located, as well as across the rest of Peru, but the company does envision eventually undertaking exports. Lara is working under a Research Collaboration Agreement with the Peruvian National Institute of Agrarian Innovation (INIA) with ongoing studies with there being selected test plots fertilized with crushed phosphate rock. The goal is to demonstrate potential improvements in crop yields through the application of locally sourced phosphates. Lara Exploration said the Mantaro project hosts thick and extensive layers of sedimentary phosphate with previous exploration having identified phosphate mineralization that is suitable for surface extraction, beneficiation and production of phosphate rock concentrates. The company has noted that the project also benefits from its strategic location near the national highway and the major rail line connecting Huancayo with Lima and the port of Callao, as well as the newly completed port of Chancay.

23-Sep-2024

HOUSTON (ICIS)–US subsea mineral exploration company Odyssey Marine Exploration announced it has been awarded $37.1 million in its arbitration with Mexico under Chapter Eleven of the North American Free Trade Agreement (NAFTA). Odyssey said it has received notification from the International Centre for Settlement of Investment Disputes (ICSID) of the arbitral award on the claims involving Odyssey and its subsidiary, Exploraciones Oceanicas (ExO) related to a planned offshore phosphate project. The company took legal action in 2018 over the rejection of an environmental permit in 2016. Finding it difficult to resolve, Odyssey said it took the NAFTA action after it determined it needed to commence the arbitration to protect its shareholders’ investment. The award orders Mexico to pay the fine for breaching its obligations under NAFTA, plus interest at the one-year Mexico Treasury bond rate, compounded annually, from 12 October 2018, until paid in full as well as the arbitrators’ fees and ICSID administrative costs. The company said the amounts awarded are net of Mexican taxes and Mexico may not tax the award and that it expects most, or all will be used to satisfy its litigation financing obligations. Odyssey said ExO is also once again challenging the decision of the environmental agency before Mexico's highest federal administrative court, the Tribunal Federal de Justicia Administrativa. It did not reveal when it expects a decision. Company officials said the ruling validates their position that the environmental agency wrongfully denied the permit despite it having received extensive input to determine not only an economically feasible development plan but one which is environmentally responsible. “The project remains strategically significant and commercially viable,” said Mark Gordon, Odyssey Marine Exploration CEO. “We are poised to continue advancing our projects globally, while also collaborating with nations interested in exploring their underwater mineral resources to meet the escalating demand for critical minerals. “ “Our focus remains on minerals that offer solutions to pressing global challenges, such as mitigating carbon emissions through renewable energy adoption and enhancing fertilizer accessibility to support an ever-growing global population.”

19-Sep-2024

HOUSTON (ICIS)–Mineral development company First Phosphate announced it has the results of its initial mineral resource estimate for its Begin-Lamarche project, located in the Saguenay-Lac-St-Jean Region, Quebec. The MRE was undertaken by P&E Mining Consultants and it showed favorable results with there being an inferred pit-constrained mineral resource of 214 million tonnes at a phosphate grade of 6.01%, with an indicated pit-constrained mineral resource of 41.5 million tonnes with a grade of 6.49%. First Phosphate said the Begin-Lamarche deposit also presents the potential for recovering two additional primary mineral products which are a magnetite concentrate, iron and an ilmenite concentrate, titanium. It added that it contains very low levels of potentially deleterious elements. “We have demonstrated that the company benefits from a substantial strategic phosphate deposit located at only 70 km from the deep-sea port of Saguenay and Canadian Air Forces NATO Base Bagotville,” said John Passalacqua, First Phosphate CEO. “Our goal will be to bring this mineral resource into preliminary economic assessment later this year to then be able to evaluate the commencement of a feasibility study.”

18-Sep-2024

HOUSTON (ICIS)–US conservation groups have announced the reaching of an agreement with phosphate mining company P4 Productions which will result in millions in payments and other measures to benefit the conservation of sage grouse and other wildlife. Under the agreement, P4, which is a subsidiary of Bayer AG, has agreed to pay $5.1 million to a trust fund for sage grouse habitat restoration and conservation and $2.43 million to acquire land to protect wildlife habitat connectivity. There will be an additional $300,000 provided for sage grouse population surveys. The company also agrees to operational restrictions of its Caldwell Canyon phosphate mine in southeast Idaho to minimize the mine’s impact on sage grouse. Some of those measures includes refraining from rail traffic to or from the mine prior to 27 April each year and evaluating then implementing selenium dust mitigation measures at the ore handling and storage area. This agreement resolves a 2021 lawsuit filed by the Center for Biological Diversity, Western Watersheds Project and WildEarth Guardians. In that action, the parties were challenging a decision by the Bureau of Land Management (BLM) to approve approximately 1,559 acres to be strip-mined for phosphate of what it deemed as ecologically important land which is essential to the sage grouse and other species. Once numbering in the millions the sage grouse populations is estimated to have declined by as much as 93% and the conservation groups say that phosphate mining has had a serious negative impact, especially on the birds in this portion of Idaho. “Phosphate mines have greatly reduced the ability of many species, including grouse, to move within and through southeast Idaho to connect with other populations,” said Chris Krupp, WildEarth Guardians a public lands attorney. “This agreement can be a first step in a much-needed larger effort to reconnect wildlife and their habitat in the region.” The groups said the BLM is now reviewing a newly proposed mine and reclamation plan and will be issuing a new decision. “I’m glad this agreement will help conserve greater sage grouse and curb the harms of this mining project,” said Lori Ann Burd, Center for Biological Diversity’s Environmental Health Program director. “This case helped make clear that the federal government can’t simply ignore the environmental harms of phosphate mining. This is a great start, but we’ve got to do much more to confront the mining industry’s threats to sage grouse and other imperiled animals and plants.”

17-Sep-2024

HOUSTON (ICIS)–Fertilizer producer Harvest Minerals announced it has signed a technical cooperation agreement with PVW Resources Limited, an Australian company specializing in the advancement of rare earth element projects. The company said this collaboration aims to unlock the rare earth element potential at the Arapua project in Brazil, with the intention of progressing on the asset if results of the fully funded work programs continue to be favorable. Under the terms, PVW will provide technical expertise for the evaluation of the rare earth element potential of Arapua including reviewing historical data and identifying new targets for resource potential. Results to date have been positive for Harvest Minerals with the next batch due in October with the data from these results the basis for the next stages. The ongoing rare earth element work program at Arapua includes re-assaying a large set of rock samples and drilling data to further detail the mineralization. Upcoming there will be planning for additional drilling for resource expansion and the evaluating of processing methods and beneficiation processes to substantiate the preliminary findings. The company did say if their fertilizer interests are not impacted by this agreement. At Arapua it has been primarily focused on producing their organic, multi-nutrient fertilizer branded as KP Fertil, which is typically applied in Brazil in lieu of more traditional phosphate fertilizer inputs. “This partnership opens the door to realizing the rare earth element potential of Arapua, adding further value beyond our established low-cost, high-margin fertilizer business,” said Brian McMaster, Harvest Minerals chairman. “Brazil has emerged as a major player in the international rare earth element space and PVW is already making inroads into that space. We are extremely fortunate that they have seen the potential at Arapua and agreed to team with us.”

17-Sep-2024

HOUSTON (ICIS)–Canadian junior explorer Nevada Organic Phosphate (NOP) announced that their subsidiary Nevagro, has been informed by the Bureau of Land Management (BLM) that the agency is authorizing the Murdock Mountain Phosphate Exploration project. British Columbia based NOP said the BLM found no significant impacts and so the preparation of an Environmental Impact Statement (EIS) is not required. This decision approves the exploration plan portion of the prospecting permit application submitted to the BLM with prospecting permit to be issued separately. “The next step in the process will be a request from the BLM to submit a reclamation bond. In accordance with US Federal Regulation 43 CFR § 3504.50, a reclamation bond will be required once the official decision is made to approve the Prospecting Permit Application,” said Robin Dow, Nevada Organic Phosphate CEO. NOP aims to be one of the only certified organic rock phosphate producers with large-scale potential in North America and is currently advancing on the Murdock project, which contains a nearly flat lying sedimentary bed of known phosphate mineralization in northeast Nevada. The company said the increasing interest in organic and sustainable agriculture practices has contributed to the demand for organic fertilizers, including those derived from rock phosphate. Organic rock phosphate is often marketed as a fertilizer that not only provides phosphorus but also contributes to overall soil health.

17-Sep-2024

HOUSTON (ICIS)–Expected to make landfall late Monday in South Carolina but not develop further, the next round of tropical weather is already delivering wind and rains to the region but for the fertilizer industry, it was not seen as being the type of threat that Hurricane Francine was last week. While South Carolina and North Carolina have significant agriculture activities and infrastructure along with crop nutrient operations and distribution, fertilizer manufacturing is less prevalent than in other parts of the US. The storm was being classified as a tropical rainstorm with potential to produce several inches of rain per hour with it expected to trek northward once it makes landfall. There have been tropical storm-force winds seen from this event but there has not been a defined center of circulation. In terms of major fertilizer activity, Canadian producer Nutrien has the Aurora Phosphate plant in Aurora, North Carolina, with the city located near the coast. The company said it is keeping aware and taking necessary steps. “We are actively monitoring the tropical storm system and have comprehensive emergency response plans in place to ensure the safety of our people and operational integrity of our facilities,” said a Nutrien spokesperson. Like the previous tropical weather that has struck the US, this storm’s wrath will bring the most damage to crops. Harvesting of corn and soybeans are underway, with cotton and other crops now maturing also in jeopardy, with the heavy rainfall likely causing some localized flooding. Harvesting campaigns in both South Carolina and North Carolina have been halted, with this trend possibly carrying into the surrounding states. If the rain is extensive the delay could be several days, if not longer depending on rainfall amounts. The concern is with a delay in these activities it creates an additional lag for starting post-harvest field activities like end-of-the-year fertilizing. The US Department of Agriculture (USDA) reported that 47% of the corn crop had been completed with only 1% of soybeans having been harvested in North Carolina. There were no results provided for South Carolina. As with Hurricane Francine which hit both Louisiana and Mississippi much more severely, the true impact of this latest tropical system will be felt in crop damage rather than damaged fertilizer plants or retail operations. There is concern that any loss of yields will mean less income for farmers which then could cause a sizeable decrease in buying for further volumes.

16-Sep-2024

HOUSTON (ICIS)–Having lashed out across northern Mexico and south Texas with rain and winds over the past 24 hours, Tropical Storm Francine has started to track further with an expected landfall in Louisianna as a moderate hurricane on 11 September. With numerous manufacturer plants, storage and shipping operations, especially within New Orleans, the state of Louisianna is an important segment for the US fertilizer industry, which has quickly turned more concerned over the possible hurricane. Especially as the tropical threat has increased in the last 36 hours and possibly bringing even more destructive impacts than initial thought over the coming days. High winds, heavy rainfall and subsequent flooding is a part of the immediate forecast with the acreage in the path of Francine maybe being subject to crop damage and significant inundation. This could decrease yields, halt harvesting and will hold back any additional field work for several weeks, including any fall fertilizing. For now, the focus is on preparing as much as possible for what might develop within the next 24 hours with producer Nutrien said it was keeping watch and was getting ready. “We are actively monitoring the situation surrounding Tropical Storm Francine and have comprehensive emergency response plans in place to ensure the safety of our people and operational integrity of our facilities,” said Nutrien spokesperson. CF Industries, with considerable operations in the storm’s project path, has not responded to inquiries over plans for storm preparation or maintaining operations. Also, without comment has been producer Mosaic, but ammonia sources said it was expecting the storm would have little bearing on current activity as it is still a quiet period for the nutrient. A phosphate source said some imports volumes which were scheduled to arrive soon have been delayed a bit because of these renewed weather concerns. Overall the cautious but not overly concerned sentiment is prevalent with it likely due to the less severity of this potential hurricane, but also because the fertilizer industry has weathered some challenges in recent years like the pandemic and international conflict. Given the past events experienced, an industry source said “I think the market has shrugged it off so far because that's how we're doing most shocks so far this year and it's worked”. Late on Tuesday afternoon Tropical Francine was at a wind speed 65mph and moving northeast at 10mph with their predictions that it will strengthen further as it moves closer to landfall estimated now to be sometime during Wednesday.

10-Sep-2024

HOUSTON (ICIS)–Fertilizer producer OCI Global announced it has successfully completed the sale of its equity interests in Iowa Fertilizer Company (IFCO) for $3.6 billion to Koch Ag & Energy Solutions. The producer said the closing of the deal involving the large-scale US greenfield nitrogen fertilizer facility marks a significant milestone in OCI’s strategy to unlock value for shareholders Located in Wever, Iowa the plant was the first greenfield nitrogen fertilizer plant built in the US in over 25 years, and the largest private construction project in Iowa’s history, adding more than 3,500 jobs during the construction period. The facility opened in 2017 and has the capacity to produce 3.5 million tonnes of nitrogen fertilizers and diesel exhaust fluid annually. “This acquisition marks another significant investment in the growth of our fertilizer business,” said Mark Luetters, Koch Ag & Energy Solutions president. “In the past 15 years, we have invested $2 billion in our North American production facilities to enhance reliability, expand production and improve logistics for our customers. This investment enhances our ability to serve customers long-term by providing additional flexibility to adapt to their nitrogen preferences.” The Wever facility adds to the Koch Fertilizer holdings, which includes four nitrogen production facilities in the US and one in Canada plus an extensive terminal network. The company and its affiliates also have partial ownership of three nitrogen facilities in Trinidad and Tobago, as well as a phosphate production facility in Morocco. The sale was first announced last December and OCI said it is confident that under Koch’s stewardship, IFCO will be well positioned for its next phase of growth. “This milestone further reinforces OCI’s standing and record as a successful developer, operator and investor. Looking ahead, we will continue to deploy our distinctive knowledge, management expertise and entrepreneurial spirt into further value accretive ventures,” said Nassef Sawiris, OCI executive chairman.

29-Aug-2024