Phosphate Rock Snapshot

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Ammonia Snapshot

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DAP Update

DAP, diammonium phosphate, is the main solid phosphate fertilizer. Its excellent handling properties and N-P-K composition 18-46-0 make it well suited to both large- and small-scale agriculture. The production of one tonne of DAP requires 0.23 tonnes of ammonia and 1,175 tonnes of phosphoric acid 40% P2O5 (0.470 tonnes P2O5). Actually this means that the production of one tonne of DAP requires almost one tonne of the fourth element, sulphur.

 

The DAP trade is the dominant element in the phosphate scene, heavily influencing production and prices, some 35-40% of the global output of phosacid is used in DAP manufacture. Nearly half of the global production of DAP is traded across borders, much more than urea, but significantly less than potash.

 

DAP Essentials

 

DAP Cons

 

DAP Cons Table

 

DAP Prd

 

DAP Prd Table

 

DAP Exp

 

DAP Exp Table

 

DAP Imp

 

DAP Imp Table

 

DAP Prc

 

DAP Prices

 

 

Brief Urea Update

Urea Production and Exports

 

Urea Consumption 2015

Urea Production 2015

Urea Exports 2015

Urea Imports 2015

Urea Prices

Fertilizer Prices

F Prices

Natural Gas Snapshot

Natural gas is a fossil fuel used as a source of energy for electricity generation, heating, cooking, fuel for vehicles, and as a chemical feedstock in the manufacture of plastics and other commercially important organic chemicals. Due to environmental reasons, natural gas is considered as the stepping stone between fossil fuels such as coal and oil, and renewable energy such as water, wind, and solar power. Natural gas reserves are estimated at 187 trillion cubic meters in 2015.

Gas Prod Graph

 

Gas Top Ten

 

Gas Prices

Mineral Production Used by the Fertilizer Industry

 

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Fertilizer Capacities

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North America Giant Fertilizer Merger

Fertilizer prices have been falling in the recent years causing an erosion in the fundamentals of the industry, to which is has responded consolidating.

PotashCorp (POT) and Agrium (AGU) announced a merger of equals expected to be completed by the middle of 2017 that would create the world’s largest crop-nutrient supplier with a market value of about $26 billion. For an understanding of the significance of this new enterprise compare with the market capitalization of Mosaic (MOS) of $8.9 billion or CF Industries (CF) of $5.6 billion.

 

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PotashCorp Allan Potash Operations

 

This is a deal of giants. PotashCorp is the largest world fertilizer company by nutrient capacity (14.2 million tonnes p.a.) and they are a low-cost potash producer (in the recent quarter they outflanked competition with the lowest cost per ton at $127 of potash produced). Agrium is a leading global producer and marketer of agricultural nutrients with a 4% of the global production capacity of potash, a 2% of ammonia, a 1% of urea, and 1% of phosphate. Agrium’s retail unit buys 10 million tons of fertilizer annually. The combined company would control the majority of North America’s potash production and more than 30 percent of North American nitrogen and phosphate production.

 

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Agrium Vanscoy Potash Operations

 

The new company will be a leader in the fertilizer industry with close to 20,000 employees and operations and investments in 18 countries. PotashCorp shareholders will own 52% of new company.

The merger will result in low regional market overlap as the majority of PotashCorp fertilizer assets are in the eastern half of the U.S., Agrium’s nitrogen and phosphate assets are concentrated in western North America.  It is expected to generate up to US$500 million of annual operating synergies mainly from distribution and retail integration, production and SG&A optimization, and procurement.

The merger of the world’s largest fertilizer producer with the world’s largest ag-retailer is drawing the attention of the regulators and farmer groups.

Fertilizer Consumption Snapshot

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