19 September 2005 00:01 [Source: ICB Americas]
|Agrium US, Borger, Tex.; Kenai, Alaska||1,305|
|CF Industries, Donaldsonville, La. (4 units)||2,670|
|Dyno Nobel, Cheyenne, Wyo; St. Helens, Ore.||230|
|El Dorado Chemical, Cherokee, Ala.||95|
|Farmland Industries, Coffeyville, Kan.; ?Lawrence, Kan.||470|
|J.??R. Simplot, Pocatello, Idaho||20|
|Koch Nitrogen, Beatrice, Neb.; Dodge ?City, Kan.; Enid, Okla.; Ft. Dodge, Iowa; ?Yazoo City, Miss.||955|
|PCS Nitrogen, Augusta, Ga.; Lima, Ohio||955|
|Royster-Clark, East Dubuque, Ill.||140|
|Terra Industries, Port Neal, Iowa; Woodward, Okla.; Verdigris, Okla.||900|
*Thousands of tons per year, both solid urea and urea solutions (100 percent basis). Industrial processes are based on reacting ammonia and carbon dioxide to form ammonium carbamate, which is then dehydrated to urea.
In May 2004, Mississippi Chemical permanently closed its 575,000 ton urea plant at Donaldsonville, La., and an associate plant producing melamine. In December the same year, Terra Industries acquired Mississippi Chemical’s nitrogen business, which among other assets included a 50 percent interest in an ammonia joint venture with Koch Nitrogen at Point Lisas, Trinidad, plus the 200,000 ton urea plant at Yazoo City, Miss.
Three other urea plants were closed in 2004. Terra Industries permanently closed its 540,000 ton plant in Blytheville, Ark. and PCS closed a 440,000 ton plant in Memphis, Tenn., and idled another in Geismar, La. with 395,000 tons of capacity.
Dyno Nobel (Oslo, Norway) acquired the nitrogen assets of El Paso Corp. in November, 2003, including urea synthesis plants at Cheyenne, Wyo. and St. Helens, Ore.
In 2003, Koch Industries purchased certain nitrogen assets of Farmland Industries. The deal included urea facilities at Beatrice, Neb.; Dodge City, Kan.; Enid, Okla.; and Fort Dodge, Iowa. Farmland’s nitrogen facilities at Coffeyville and Lawrence, Kan., and Pollock, La., were not included in the purchase.
In 2002, Farmland Industries idled its urea plant at Lawrence, Kan. with a capacity of 300,000 tons. The plant is still down.??In October 2000, LSB Industries acquired the Cherokee, Ala., site from LaRoche Industries, which included a 95,000 ton urea unit. The site is operated by El Dorado Chemical, a subsidiary of LSB Industries.
Profile last published 12/2/02; this revision 9/19/05.
2003: 11,390,000 tons; 2004: 11,360,000 tons; 2005: 11,590,000 tons, projected. Demand equals production plus imports (2003: 5,470,000 tons; 2004: 5,428,000 tons). Exports are small and in recent years, have amounted to about 400,000 tons annually.
Historical (1999–2004): -0.3 (negative) percent per year; future: 0.5 percent per year through 2005
Historical (1999–2004): High, $267 per ton, spot price, prill, bulk, f.o.b. Gulf Coast; low, $75 per ton, same basis. Current: $260 per ton, same basis. Source: ICIS-LOR
Fertilizers, 85 percent (solid fertilizer, 52 percent; nitrogen solutions, 33 percent); urea-formaldehyde resins, 7 percent; livestock feed, 6 percent; melamine, 1 percent; miscellaneous, including cyanuric acid for chlorinated isocyanurates; crystalline adducts; de-icing agents, pharmaceutical intermediates, and sulfamic acid and its ammonium salt, 1 percent.
Strong nitrogen demand and high prices of natural gas feedstock drove up average urea prices by 25 percent in the past year to $260 per ton, f.o.b. In the US, the combination of below-average nitrogen producer inventories and reduced offshore urea imports resulted in a tight supply situation during the spring application season.
For nitrogen fertilizers, producers expect firm pricing and tight supplies for the rest of the year due to strong global demand and limited supplies from several export regions. A reduction in Chinese urea exports in 2005 should provide additional support to international urea markets.
Several US producers have idled or closed capacity, and there is speculation that they may keep idled plants down longer than normal because of high costs.
Corn accounts for 41 percent of fertilizer use by crops, so corn plantings are a key driver for US fertilizer demand. The USDA’s March 2005 Plantings Report showed corn plantings increased 1 percent from 2004, to 81.4 million acres in 2005. This is 4 percent above 2003 and the largest since 1985.
US urea producers’ margins have been squeezed since 2000–2001 owing to the rise in natural gas prices. With the international export market tighter this year, domestic price increases have been successful and the profit margin situation somewhat ameliorated. Prices will probably remain in the $230 to $260 per ton range for at least the next year and a half. This is a mature market and annual growth for the forecast period is estimated at 0.5 percent per year.
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