13 January 2012 14:59 [Source: ICIS news]
LONDON (ICIS)--Phosphates production at state-owned Group Chimique Tunisien’s (GCT) fertilizer plants has cautiously re-started, a company official said on Friday.
Union protests and civil unrest broke out in November 2011 and shut down the diammonium phosphate (DAP) and triple super phosphate (TSP) productio facilities at Gabes, M’Dhilla and Skhira.
The phosphate rock mines and Gabes port were blockaded, as demonstrators called on the newly-elected government to provide more jobs to ease high rates of unemployment.
Earlier this week the supply of phosphate rock to the GCT plants was eased, as blockades were removed from the rail link. Gabes port has also reopened.
“The situation has improved and we are starting to progress fulfilling previous cargo commitments to our customers,” said the official.
“The plants have resumed production at different rates but we are still cautious over whether this situation will last.”
Market sources confirm that Italian buyers looking to purchase around 10,000 tonnes of DAP are unlikely to risk booking
GCT product and will source alternative supplies.
Russian fertilizer producer EuroChem sold cargoes of DAP to several European destinations this week in the $585–600/tonne (€456–468/tonne) FOB (free-on-board) range.
In Morocco, Office Cherifien des Phosphates – which has cut output by 30% for the first quarter in an effort to support declining prices – is offering DAP into Europe at $580/tonne FOB.
GCT had expected to resume phosphates production on 1 January but output has been erratic due to ongoing sporadic eruptions of unrest stemming from the January 2011 revolution.
Annual production capacity at the main facility at Gabes is 1.3m tonnes of DAP and 405,000 tonnes of 54% merchant grade phosphoric acid when operating at full rates.
Interruptions to the supply of phosphate rock throughout last year forced GCT to shut down one of its two DAP lines, dropping output by 50%.
Production had been ramped up during the fourth quarter to around 70% before the latest round of protests broke out after the country’s general elections in November.
Given the violence surrounding Tunisia’s recent history, the new government had been reluctant to use force against the demonstrators and negotiations have taken two to three weeks to conclude.
($1 = €0.78)
For more on phosphates visit ICIS pricing fertilizers
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