Fertilizer International 516 Sept-Oct 2023
30 September 2023
Fertilizer Industry News
Fertilizer Industry News
UK
Billingham ammonia plant to close
Ammonia production at Billingham in Teesside looks set to end, bringing to a close a history of production that dates back almost a century.
The proposal to permanently close Billingham’s ammonia plant was announced by owners CF Fertilisers UK on 25th July. In a statement, the company said this was necessary “to secure the long-term sustainability of its business in the United Kingdom and more efficiently serve its customers in the country”.
The move follows CF’s closure of its large-scale fertilizer production complex at Ince in north west England in 2022 (Fertilizer International 509, p8). The Ince site was the UK’s largest producer of compound fertilizers and also manufactured large volumes of ammonium nitrate for agriculture.
Billingham is the UK’s largest ammonia, ammonium nitrate (AN) and carbon dioxide producer. The Teesside complex in north east England combines a 595,000 t/a capacity ammonia plant with 625,000 t/a of ammonium nitrate and 410,000 t/a of nitric acid capacity.
CF Fertilisers UK, a wholly-owned subsidiary of US-headquartered CF Industries, says it will continue producing AN fertilizer and nitric acid at the Billingham site using imported ammonia – as it has done since idling the site’s ammonia plant in August 2022.
“[Ammonia production at] Billingham will not be cost-competitive for the long-term compared to importing ammonia due primarily to projected high natural gas prices in the United Kingdom relative to other regions and the impact of carbon costs,” CF said in a statement.
In future, the company believes that imported ammonia, including imports from its North American operations, will enable more cost-competitive and efficient production of nitric acid and AN fertilizer in the UK for its agricultural and chemical customers.
CF’s planned closure of Billingham’s ammonia plant, which follows its closure of the Ince fertilizer production complex last year, is the latest in a series of shutdowns and consolidations that have marked the long decline of the once mighty UK ammonia industry (Fertilizer International 509, p4). British production of this basic chemical has a proud history and – under former corporate giant Imperial Chemical Industries (ICI) – the UK also became a leading global centre for innovation in ammonia technology and catalysis.
Commercial ammonia production began at Billingham in 1924 under Brunner, Mond & Co, the predecessor to ICI. By the 1960s, when ICI was the world’s largest producer, ammonia was being produced at Billingham, Heysham, Wilton, Severnside and Immingham in the UK.
UK ammonia production reached its zenith under ICI in the 1980s. However, with profits from basic chemicals dwindling, the company subsequently sold off its ammonia and nitrogen fertilizer production assets in the 1990s as part of a divestment programme.
The long-term decline in North Sea gas output has been a factor in the contraction of the UK ammonia industry. Although British industry and power generators once benefitted from a glut of cheap North Sea natural gas during the 1980s and 1990s, this is no longer the case. UK natural gas production peaked at 115 bcm in 2000 but has declined to below 40 bcm in the two decades since.
The announcement from CF now looks set to end large-scale ammonia production in the UK for good. However, the industry’s lack of competitiveness is a regional issue and not unique to UK.
Europe’s ammonia producers in general are struggling to compete on price with ammonia imports (Fertilizer International 515, p7). The elevated price of natural gas, a key feedstock, has badly affected regional production costs during the last two years. The Dutch TTF price, Europe’s main gas price benchmark, having fallen back from an all-time high of e319/ MWh in August last year, remains historically high compared to pre-pandemic price levels.
UK
Fertiberia supplies M&S dairy farms with green fertilizer
Spain’s Fertiberia is to supply Marks & Spencer (M&S) with green fertilizers to help the British supermarket reduce the carbon footprint of its 27 dairy farms.
The company will supply M&S farms with Impact Zero fertilizers, a new emissions-free product range manufactured in Spain. The supermarket’s UK distributor, Bartholomews Agri Food, signed an exclusive supply agreement with Fertiberia for these innovative fertilizers on 12th July.
Fertiberia, by substituting green hydrogen for natural gas, has managed to drastically reduce the production emissions of its Impact Zero product range. The emissions associated with these have been cut by as much as three tonnes of CO 2 for every tonne of ammonia generated, according to the company.
M&S dairy farmers will use an Impact Zero fertilizer called Tech Nergetic. This product should improve nitrogen use efficiency by 22 percent, compared to a standard fertilizer, helping to reduce the amount of nitrogen applied to the land. Its properties will also cut the amount of nitrogen lost to leaching.
“Decarbonisation of the food chain requires cooperation between all links in the chain, and this alliance shows the way forward. Fertiberia brings its Impact Zero crop nutrition solutions and R&D&I know-how, Bartholomews guarantees the best application of these solutions thanks to its extensive knowledge of UK growers and livestock farmers, and M&S is leading the initiative to bring food that drastically reduces its emissions to the end consumer,” said Javier Goñi, Fertiberia’s CEO:
M&S farms will be the first to adopt Impact Zero products from spring 2024 onwards.
“M&S has set important targets to reduce our carbon footprint and become net zero emissions across our value chain by 2040. 72 percent of M&S Food’s emissions come from agriculture and around half of these come from livestock, mainly ruminants. It is therefore essential that we work with our farmers to make a significant change. We believe the use of these fertilisers will enable our farmers to maintain productivity while playing a vital role in helping to decarbonise milk production,” said Steve McLean, head of agriculture and fisheries at M&S.
The first Impact Zero green fertilizer shipment, imported from Spain by Bartholomews Agri Food, arrived in the country via Southampton in the last week of July. The amount imported has not been disclosed.
SPAIN
Fertiberia and PepsiCo to jointly cut agricultural emissions
PepsiCo and Fertiberia are collaborating on new ways to reduce the carbon emissions of potato growing.
The two companies are trialling a new approach to cutting agricultural emissions as part of a joint pilot programme launched at the end of June. This will combine the use of low-carbon fertilizers with precision agriculture.
The pilot programme is being carried out by the Garlan cooperative, PepsiCo’s potato supplier for the last 30 years, in Spain’s Álava, La Rioja and Burgos provinces. Growers in these regions will trial Fertiberia’s new Impact Zero fertilizers. Their use is expected to reduce the emissions from potato cultivation by about 15 percent, according to Fertiberia.
Potatoes will be sown on 400 hectares of land initially. The trial will then be scaled-up over the next two years and is expected to reach 1,500 hectares by 2025. The potatoes will be grown using efficient precision farming methods. These tightly control fertilizer applications and prevent overuse by monitoring the nutrient status of crops and soils.
The Impact Zero fertilizers used in the potato growing pilot will be made from green ammonia at Fertiberia’s Puertollano production site. Green ammonia is manufactured at Puertollano using green hydrogen generated on-site by a solar-powered plant, the largest of its type in Europe.
“Fertiberia is changing the paradigm in the agri-food sector with the development of Impact Zero,” said Alfredo Segura, Fertiberia’s commercial director. “The agreement with PepsiCo confirms the potential of green hydrogen to achieve a fully sustainable agriculture.”
PepsiCo plans to increase its use of regenerative agriculture in Spain to 77,000 hectares by 2030.
“We are very proud to announce this green fertiliser pilot programme together with Fertiberia to reduce the emissions associated with fertilisers and, consequently, emissions from agriculture which account for a high percentage of our total emissions,” said Ángel Alonso, PepsiCo’s agricultural director for Southwest Europe. “This initiative complements others that we are already carrying out to regenerate the land and make it more fertile through regenerative agriculture practices.”
Fertiberia has pledged to reduce its emissions to net zero by 2035. The switch to fertilizer production using renewable energy will be the key to achieving this ambitious goal. Fertiberia has already decarbonised its Puertollano production centre (see box) and plans to follow this up by decarbonising its other Spanish production plants (Palos de la Frontera, Avilés and Sagunto) in future.
GERMANY
Yara supplies green fertilizers to cereal growers
Yara Germany has launched a joint pilot project to reduce the carbon footprint of cereal production.
In August, the company signed an agreement with two of Germany’s leading food industry players, the flour milling company Bindewald & Gutting Milling Group and bakers Harry-Brot, to supply their cereal growers with green fertilizers.
The nitrate-based fertilizers, produced at Yara’s Rostock site in Germany, will have an 80-90 percent lower carbon footprint than normal. They will be supplied to Bindewald & Gutting’s contract farmers and used to grow around 1,600 hectares of cereals in Germany from the 2023/24 growing season.
Yara Germany says the fertilizers will be made using Norwegian green ammonia. Yara manufactures this from green hydrogen generated via water electrolysis using renewable electricity.
Yara’s Rostock production complex in Germany features two nitric acid plants, two nitrate fertiliser plants, one urea ammonium nitrate (UAN) plant and two plants making technical ammonium nitrate.
“Yara Germany, all nine locations of the Bindewald & Gutting Milling Group, and Harry-Brot signed a cooperation agreement with the shared goal of reducing CO2 emissions in cereal production. The partnership will help in reducing carbon footprint along the entire food value chain, starting from fertilizers to sales and ultimately reaching end consumers,” Yara said in a statement.
The use of green fertilizers can reduce the CO2 footprint of cereals by up to 30 percent, according to Yara. The project partners plan to drive down cereal emissions even further by combining green fertilizers with precision farming and site-specific fertilization.
“Our partnership with the Bindewald & Gutting Milling Group and Harry-Brot is a crucial first step to decarbonize German agriculture. It is a concrete example of how food production can be transformed in a sustainable way,” said Marco Fleischmann, Yara Germany’s managing director.
“The avoidance and reduction of greenhouse gas emissions in all scopes is at the core of our sustainability strategy. While we are continuously working on reducing Scopes 1 and 2 CO2 emissions, with short delivery and transport routes and efficient production, we are still dependent on agriculture and our suppliers when it comes to Scope 3 emissions. If we succeed, starting with fertilization, we can reduce emissions precisely where a large proportion of our supply chain emissions has always occurred. This is why we are proud to be part of this innovative project,” said Norbert Lötz, Harry-Brot’s managing director for production and technology.
Yara says the new project will offer consumers “a sustainable food choice” and support “climate-friendly [fertilizer] production”.
Nearly three-quarters of German consumers would like to see the CO2 footprint of products displayed on packaging, according to an IPSOS study commissioned by Yara. More than half of German consumers are also willing to pay extra for food with a smaller carbon footprint, the study suggested.
SAUDI ARABIA
FLSmidth wins major Ma’aden beneficiation order
FLSmidth has secured a DKK 530 million contract for Ma’aden’s ‘Phosphate 3’ project.
The Danish mining equipment company will provide major items and critical services for the construction of a large-scale phosphate beneficiation plant at the project’s mine site in the Northern Province of Saudi Arabia.
FLSmidth has agreed to supply Ma’aden with key equipment for the beneficiation plant, as well as support services covering its design, construction, commissioning and ramp-up. The order includes: primary and secondary sizers, apron and HAB feeders, cone crushers, screens, cyclone clusters, ball mills, paste and high-rate thickeners, horizontal belt filter, slurry pumps, knife-gate valves and flotation columns.
FLSmidth has booked the order for the third-quarter of this year. It expects all the beneficiation equipment to be fully integrated on-site in Saudi Arabia during 2025.
“We are pleased to collaborate with Ma’aden on this expansion, as this order sets another strong standard for our MissionZero agenda,” said Mikko Keto, FLSmidth’s CEO. “In particular the incorporation of our paste thickening and dewatering technology at this important mine site plays a key role in reducing emissions and water spend from the beneficiation process.”
FLSmidth’s partnership with Ma’aden on its latest phosphate mine project began in 2019 with the laboratory testing of samples collected from the ore body. The company subsequently carried out pilot-scale tests and developed the beneficiation flowsheet.
Ma’aden renews fertilizer supply deal with Bangladesh
Ma’aden has renewed its agreement to supply the Bangladesh Agricultural Development Corporation (BADC) with 600,000 tonnes of fertilizers. The agreement was signed during a visit to Ma’aden’s headquarters by a BADC delegation in mid-August.
The agreement means Ma’aden will continue to supply approximately 42 percent of Bangladesh’s diammonium phosphate (DAP) requirements.
“We are pleased that we are able to continue working with BADC to ensure a reliable supply of high-quality fertilizer products to the Bangladesh market. We are excited to extend our near-decade-long relationship with BADC and playing a role in helping support food security efforts in the region,” said Hassan Al Ali, Ma’aden’s EVP for its phosphate business unit.
Ma’aden is planning to increase its phosphate fertilizer production by 50 percent to nine million tonnes p.a. by implementing its ‘Phosphates 3’ mega project. The company is the world’s second-largest exporter of phosphate fertilizers currently.
SABIC Agri-Nutrients ships low-carbon urea to New Zealand
SABIC Agri-Nutrients Company’s (SABIC AN) has made its first ever global shipment of low-carbon urea.
The 2,700-tonne urea consignment was successfully delivered to Ravensdown, the farmer-owned agricultural co-operative, at Timaru, New Zealand on 21st July
“Our collaboration with Ravensdown is a major step in this direction and a strong indicator of SABIC’s overall commitment to delivering low-carbon solutions to customers and helping them achieve their net-zero targets,” said Abdulrahman Shamsaddin, SABIC AN’s CEO.
“This collaboration with SABIC AN is key to ensuring we meet our commitment to reduce carbon emissions by 50 percent by 2030. As pressure mounts for New Zealand farmers to lower greenhouse gas emissions from behind the farm gate, it is important we pull our weight across all facets of our supply chain too,” said Garry Diack, Ravensdown’s CEO.
SPAIN
Briefing: Fertiberia pioneers Europe’s green ammonia market
Fertiberia’s Puertollano green hydrogen plant was officially inaugurated by His Majesty Felipe VI, the King of Spain, in mid-May.
The large-scale plant will produce up to 3,000 tonnes of renewable hydrogen annually. It incorporates one of the world’s largest water electrolysis systems and is powered using renewable electricity from an integrated 100 MW photovoltaic solar array. The plant, the largest of its type in Europe, will supply the company’s nearby fertilizer complex, enabling Fertiberia to produce green ammonia at Puertollano, using green hydrogen instead of natural gas.
This major project was successfully developed in partnership with the Spanish electrical utility Iberdrola. It forms the centrepiece of Fertiberia’s net zero strategy and the company’s ambitions to become carbon-neutral by 2035.
With Puertollano’s inauguration, Fertiberia says it has become the world’s first major crop nutrient company to begin carbon-free ammonia and fertilizer production on an industrial scale.
The inauguration was attended by the Javier Goñi, Fertiberia’s CEO, and Ignacio Sánchez Galán, president of Iberdrola. Major Spanish civic and government leaders, both regional and national, were also in attendance.
Javier Goñi said Fertiberia’s investment in Puertollano marked the first step towards pioneering the green ammonia market in Europe.
“The milestone … makes us the first company in the world to manufacture green ammonia and CO2 -free crop nutrition solutions on an industrial scale. The project is unique in the sector due to its sheer size. This initiative is part of our Net Zero strategy which, thanks to the support of our owner Triton, will make us the first major European company in our sector to reduce emissions to zero by 2035,” Goñi said.
Fertiberia “is moving forward in the decarbonisation of the essential agriculture sector”, added David Herrero, the company’s industrial director. “By replacing natural gas with indigenous resources … we are helping to move towards food and energy independence in the EU,” he said. n
SABIC AN produced the urea using blue ammonia. The company’s low-carbon ammonia production has been independently certified by TÜV Rheinland, a leading independent testing, inspection, and certification agency. This guarantees that a significant part of the CO2 associated with the manufacturing process has been captured and used downstream.
UNITED STATES
Nutrien shelves Geismar project
Nutrien has decided not to proceed with a large-scale blue ammonia project in Geismar, Louisiana.
The Canadian fertilizer giant halted the project on 3rd August, Argus reported, because of rising capital costs and “continued uncertainty on the timing of emerging uses for clean ammonia”.
The company said it will now prioritise other capital allocations instead.
Nutrien first announced plans to construct what had been called the world’s largest blue ammonia plant at Geismar in May 2022 at an estimated cost of around $2 billion. However, the project’s projected costs have since increased by around 15-20 percent, according to Ken Seitz, the company’s president and CEO.
A final investment decision (FID) for Geismar had been expected this year with the project moving to construction in 2024 and potentially becoming fully operational in 2027. The decision to shelve the project for now will mean a delay of “at least 24 months”, said Trevor Williams, Nutrien’s president for nitrogen and phosphate.
The tax credits offered for sequestering carbon dioxide by the US Inflation Reduction Act provided “a big improvement in terms of being able to try and justify” projects like Geismar, Williams said. But these incentives still “didn’t get [Nutrien] over the hurdle in terms of the economics of the project at this point”, he said.
“[While] there will be an opportunity in the clean ammonia business in the future, the timing of the evolution of that demand is unknown,” said Seitz.
“Today, the evidence wouldn’t be sufficient to justify the assumption of a premium – at least not in the near term – emerging for clean ammonia,” added Mark Thompson, Nutrien’s chief commercial officer.
BRAZIL
Unigel indefinitely halts Laranjeiras plant
Unigel indefinitely suspended operations at its Laranjeiras nitrogen fertilizer plant in the state of Sergipe on 11th August, ICIS has reported.
The shutdown is due to high natural gas costs and follows Unigel’s announcement to temporarily idle the plant for 90 days from 1st June.
“The company continues to make every effort to make the production of nitrogen fertilizers feasible,” Unigel said.“ [It] continues to establish dialogues with public agents and authorities and negotiate conditions with the main gas suppliers, in favour of solutions for the challenging situation that surrounds the chemical industry and the production of national fertilizers [in Brazil].”
The Laranjeiras plant is Brazil’s largest nitrogen fertilizer manufacturing site with a production capacity of 650,000 t/a for urea, 450,000 t/a for ammonia and 320,000 t/a for ammonium sulphate. Urea production at Unigel’s other fertilizer plant at Camacari in the state of Bahia also remains offline currently.
AFRICA
Stamicarbon to build two sub-Saharan African urea plants
Stamicarbon has secured a second contract for a 4,000 t/d urea melt and granulation plant in sub-Saharan Africa.
It follows the award of a license and process design package for an identical plant at the same location by the same customer last year. Neither the customer or the location have been disclosed.
Combined, the two contracts cover the delivery of high-pressure equipment and fluid bed granulation units for two urea production trains at a world-scale integrated ammonia and urea complex. This will have a total capacity of 4,600 t/d for ammonia and 8,000 t/d for urea.
Stamicarbon’s pool condenser with MP Flash design offers significant reductions in energy consumption, while the granulation plant will use Stamicarbon’s fluid bed granulation technology. An integrated off-gas acidic scrubbing system, meanwhile, will cut ammonia emissions to a minimum. The system also eliminates waste water by incorporating innovative salts reworking technology. The high-pressure equipment for the synthesis sections will be in durable Safurex® duplex stainless steel.
The ammonia-urea production complex is expected to become operational in 2026. The complex has a strategic location and is well placed to meet growing regional and global demand for high-quality fertilizers, according to Stamicarbon.
“We are glad to have secured this licensing and proprietary equipment contracts for this grassroots complex that will support agriculture, create local jobs and address the growing demand for high-quality fertilizers across the Sub-Saharan region and other parts of the world,” said Pejman Djavdan, Stamicarbon’s CEO. “We look forward to building a long-term relationship with our new customer over the coming years and watching this exciting project grow.”
CAMEROON
Yara Cameroon acquired by NJS Group
Yara has agreed to sell its 65 percent stake in Yara Cameroon to NJS Group, its local partner in the country.
NJS Group, founded by the late Jean Samuel Noutchogouin, will become Yara Cameroon’s sole shareholder, once the transaction is completed, having held a minority stake in the business since its inception in 1995. Yara said the sale of its majority stake, owned by Yara International France, was a natural and strategic development.
“Yara International ASA and the Noutchogouin family have been partners for over 25 years,” Yara said in a statement. “This complete takeover of the company by its local historical minority shareholder paves the way for ambitious expansion projects.”
Yara and NJS Group will strengthen their collaboration, despite the divestment, having concluded an exclusive distribution agreement for the premium NPK fertilizers, YaraMila, and YaraLiva Nitrabor Calcium Nitrate. This will ensure Cameroon’s farmers and agricultural retailers continue to receive a supply of these products in future. Yara has also agreed to provide NJS Group with technical and operational support.
AUSTRALIA
Pupuk Kaltim in talks to buy Incitec Pivot Fertilizers
Indonesia’s Pupuk Kaltim has emerged as the frontrunner to buy Incitec Pivot Fertilisers, according to the Australian Financial Review (AFR).
Incitec Pivot Limited (IPL) have turned away other suitors, AFR reported in early August, in favour of negotiating a bilateral deal for its fertilizer business unit with state-owned Pupuk Kaltim.
Incitec Pivot Fertilisers is Australia’s biggest fertilizer manufacturer and distributor, with a market share of about 50 per cent in eastern Australia. The business unit is valued at around AUD 1.5 billion ($989 million). It typically generates annual revenues in the region of AUD two billion and earnings of around AUD 200 million.
IPL’s Gibson Island plant near Brisbane ceased production in January, having failed to secure a new gas supply contract (Fertilizer International 506, p10). IPL and its partner Fortescue Future Industries are, however, looking at the feasibility of converting Gibson Island to green ammonia production (Fertilizer International 511, p8).
IPL also owns a major phosphate production complex at Phosphate Hill, Queensland, and a superphosphate plant at Geelong, Victoria. The company recently sold its 880,000 t/a capacity Waggaman ammonia plant in Louisiana in the United States to CF Industries for $1.7 billion (Fertilizer International 514, p10).
In Indonesia, Pupuk Kaltim operates five ammonia plants with a combined capacity of 2.7 million t/a and five urea plants with a combined capacity of 3.4 million t/a. Any sell-off to an overseas company would require the approval of Australia’s Foreign Investment Review Board.
IPL’s former CEO Jeanne Johns and Christine Corbett, the head of its fertilizer business unit, have left the company in recent months. Both were associated with plans to demerge IPL into separate fertilizer and explosives companies.
UZBEKISTAN
$100 million investment in phosphate rock mining
The ramp up of the new NEOFOS mine in Uzbekistan’s Navoi region looks set to increase the country’s phosphate rock production to 2-2.5 million tonnes annually.
The $100 million mine is owned by investment company Ferkensco Management Limited. More than 30 large-scale excavators (including diesel-hydraulic excavators, a milling combine, dump trucks, bulldozers and graders) are being used to extract phosphate rock from a 50-metre-deep opencast mine over a large area (45.7 km2 ).
NEOFOS will also produce phosphate rock concentrate as part of the project’s second phase. A dedicated processing plant, scheduled to open by the end of 2023, will supply concentrate to the under-construction Samarqandkimyo fertilizer plant, another Ferkensco investment project.
“Samarqandkimyo chemical complex will become the largest producer of phosphorus-containing fertilizers in Uzbekistan. The enterprise will annually produce up to 910,000 tonnes of high-quality products, which will not only cover the needs of local farmers, but will also enter the export market, competing with foreign manufacturers. Own raw materials produced in NEOFOS will reduce dependence on third-party suppliers and make the operation of the complex uninterrupted,” said Timur Zhuraev, the head of Ferkensco Management Limited in Uzbekistan.
