GRAND FORKS – North Dakota corn growers are planning a $1 billion nitrogen fertilizer manufacturing plant to be built near here in rural Grand Forks County.

Gov. Jack Dalrymple and Grand Forks Mayor Mike Brown will make a formal announcement today.

The plant will produce nitrogen fertilizer by converting gas currently being flared from oil wells in western North Dakota, according to Tom Lilja, president of the North Dakota Corn Growers Association. Other details will be released during today’s news conference.

The facility, which has been estimated to cost between $1 billion and

$1.5 billion, could supply fertilizer for up to 12 percent of corn and wheat acreage in North Dakota, South Dakota and Minnesota, Lilja said last summer, when the group initially announced plans to build a plant somewhere in North Dakota.

Read more at Inforum

Britain will be forced to become a net importer of wheat for the first time in a decade this year, after the recent bitter weather devastated crops.

Fertilizer worthy more than Sh2 billion will arrive in the country this month for use by farmers during the planting season.The National Cereals and Produce Board says the consignment of one million bags will be available to farmers for use as they start planting next month.

“It will be arriving shortly and farmers should be assured that they will have adequate fertilizer this year,” said NCPB spokesman Evans Wasike.

However, the board already has more than 800,000 bags of fertilizer at its depots in parts of the country and farmers are purchasing the commodity ahead of the planting season. The consignment being imported include both DAP for planting and CAN for top dressing.

Read more at The Star

In a virtual clampdown on imports, the Government has stopped issuing fertiliser movement control orders on all imported di-ammonium phosphate (DAP) and NPK complex nutrients from this month.

The move has been triggered by the huge unsold stocks of fertilisers lying both with companies and the distribution chain, following the recourse to large-scale imports undertaken this fiscal and poor offtake from farmers.

QUANTITATIVE CURBS

While the Government has freed the maximum retail prices chargeable by companies for all non-urea fertilisers, it, however, still regulates how much material is to be sold in different States. Accordingly, it also decides which company would sell how much quantity. These, in turn, are regulated under the Fertiliser (Movement Control) Order issued every month.

Without obtaining an order, a company cannot avail of the Government’s subsidy concession on the material that has been despatched by it. The order, moreover, is applicable on both fertilisers manufactured by the company and imported by it.

“For this month, orders have been issued only for the DAP and complexes being manufactured by the companies. No order is being issued for any new material that is being imported. The imported material can only be kept in the ports and since no subsidy will be paid without a movement control order, nobody will import,” an industry source told Business Line.

According to him, the Department of Fertiliser has told all companies verbally that it will not issue any movement control orders, without giving in writing though.

IMPORTS

During April 2012 to January 2013, fertiliser makers have imported about 58 lakh tonnes (lt) of DAP and another 4 lt of complexes containing nitrogen, phosphorous, potash and sulphur in various proportions.

Indian Potash Ltd has been the single largest importer at 14.44 lt (all DAP), while the erstwhile KK Birla Group companies – Chambal Fertilisers, Zuari Industries and Paradeep Phosphates – together have brought in 15.5 lt of DAP and 1.04 lt of complexes.

Read more at The Hindu Business Line

Bert Frost, senior vice president, sales and market development for CF Industries, offers his insight on the state of the nitrogen fertilizer marketplace.

In January, CropLife conducted a short Q&A with Bert Frost, senior vice president, sales and market development for CF Industries on the state of the nitrogen (N) fertilizer marketplace. Here is what he had to say:

What were the key market dynamics for N fertilizers in 2012?

Strong global demand made 2012 an excellent year for the N fertilizer market. Acres planted were high around the world and prices for many crops reached record highs, even before the impact of droughts in areas such as the U.S. and former Soviet Union countries became clear. On the supply side, the political disruption, construction project delays and natural gas availability resulted in production issues primarily in North Africa. Natural gas supplies were tight in Trinidad, limiting production from a key North American supply region. In addition, a high volume of Chinese exports was offset by high demand into India. These resulted in a relatively tight market which supported N fertilizer prices throughout the year.

What notable trends did you see in the N market during the fall 2012 application season?

In North America, the corn and soybean harvest occurred one to three weeks early and weather was conducive to fall fertilizer application. The result was an early fertilizer season and strong fall N demand. In the U.S. N market, we saw high imports, especially for urea, in order to meet the strong demand. Chinese exports during the fall were above expectations. However, this mostly offset production issues in other places around the world such as Algeria, Egypt, Trinidad, Pakistan and Bangladesh.

What is your outlook for the North American crop nutrient supplier industry — particularly for N fertilizers — in spring 2013?

We expect strong nitrogen fertilizer demand to continue due to high corn plantings, which could exceed last year’s high level of close to 97 million acres. However, we see two significant challenges for the spring. The first issue is logistics, as record low water levels on the Mississippi River will challenge product shipments in particular for imports coming from the Gulf. The second issue is low inventories for many products — most especially ammonia. Tight supplies could limit ammonia sales in the spring and result in some demand shift towards UAN and urea.

Burma’s Ministry of Energy (MOE) has announced that it will distribute low-cost urea fertilizer produced by state-owned factories to farmers across Burma.

“In coming fiscal year, 258,802.50 tons of fertilizer will be produced,” said a spokesperson from the Myanmar Petrochemical Enterprise (MPE). “We will distribute it for a reasonable price by using less agents.”

The product will be sold through a six-month credit system. 

Urea fertilizer is produced depending on the amount of onshore gas extraction under the supervision of the MOE—it cannot be produced to market demand and is cheaper than imported fertilizer.

Something about the price of fertilizer doesn’t smell quite right to farmers. Growers in the Rocky Mountain region have asked the U.S. Department of Agriculture to investigate possible price fixing in the chemical-fertilizer industry.

It’s not just that fertilizer prices are near record highs, farmers say. The bigger concern is that natural gas, a main feedstock for nitrogen fertilizers, is priced near a 10-year low.

Farmers believe that low prices of natural gas should be reflected in their cost of fertilizer.

The price of anhydrous ammonia, a common nitrogen-based agricultural fertilizer, hasjumped 50 percent since 2006. But during the same period, natural gas prices have fallen by 60 percent.

“Historically, cheap natural gas equals cheap anhydrous ammonia,” said Yuma County corn farmer Mike Bowman. “But we have seen that correlation disappear.”

The Rocky Mountain Farmers Union, representing growers in Colorado, New Mexico and Wyoming, announced at a recent convention that it is asking for a price-fixing investigation.

The disconnect between natural gas and fertilizer prices “is siphoning millions of dollars from the U.S. agriculture economy,” the farmers organization said in a statement.

The USDA did not respond to questions Wednesday on the farmers’ concerns of price fixing. A representative of the Fertilizer Institute, a Washington, D.C., association representing the industry, did not return calls.

Read more at denverpost.com

Manure is spread on a cornfield at Eckhardt Farms in Weld County. Owner Dave Eckhardt uses manure and nitrogen fertilizer, the cost for which is near a record high. (Helen H. Richardson, The Denver Post)