India: Oman was the biggest supplier of urea in 2011-12

Whilst in 2010-11, China was India’s biggest urea supplier, accounting for nearly 38 per cent of its total imports, in the 2011-2012, the main supplier was Oman which provided about one-third the imports. The weighted average cost of India’s urea imports in 2011-12 was US$ 481.74 per tonne, which was up about 47 per cent over the previous year. This translates into total urea imports of US$ 3.77 billion.

India’s urea imports increased 18.5 per cent during the fiscal year 2012 vis-à-vis the previous fiscal. Most of the imports from Oman were through India’s long-term off-take agreement with Oman India Fertiliser Company, a joint venture between Oman Oil Company SAOC, IFFCO and Kribhco. Iran was India second-biggest supplier, followed by China. Iran accounted for 25.5 per cent of the urea imports, while China provided another 16.3 per cent.

India: NFCL New Urea Project

Hyderabad-based Nagarjuna group fertilizer company Nagarjuna Fertilizers and Chemicals Ltd (NFCL) is planning to expand its fertilizer facility in Kakinada, Andhra Pradesh, by setting up a 1.3 million tonne per annum brownfield urea project. This will take up the total capacity of the Kakinada plant to around 3 million tonnes per annum. The Kakinada facility currently has two plants making urea and ammonia with. The new expansion facility is slated to come up within the existing complex and NFCL is planning to invest over US$ 0.91 billion in the setting up of the new urea plant.

The company is already understood to have sought a 2.4 mmscmd (million metric standard cubic meters per day) gas allocation for the expansion project by 2014-15 and has applied for the necessary approvals for the same. NFCL, the flagship of Nagarjuna group that was set up in 1986-87, manufactures and markets plant nutrients under the Nagarjuna brand, and they are the single largest private sector investment in southern India. NFCL has also signed a MOU (memorandum of understanding) with Nigeria, which is Africa’s biggest oil producer and has the continent’s largest gas reserves, to build petrochemical and fertilizer plants in the southern Delta state and in Lagos, the commercial capital.

Turkey: Tarim’s Partnership With Giant Moroccan OCP

Morocco’s largest industrial company Office Chérifien des Phosphates (OCP) have gone into a fertilizer partnership with Toros Tarim, one of the biggest agricultural companies in Turkey. The companies have together founded Black Sea Gübre Ticaret, and they plan to produce phosphatic fertilizer in facilities located in the northern province of Samsun, and export them to Eastern European, Balkan and Central Asian countries. The joint-venture social capital belongs 70% to the OCP group and 30% to Toros.

Toros will invest US$ 232 million and its new sulphuric acid capacity will reach 726,000 tpa and the revamping of the phosacid plant will increase nameplate capacity to 200,000 tpa. With this Toros will be able to be self-sufficient in their phosacid needs. The upgrading of the NPK plant will result in the new sulphuric acid plant direct feeding to it.

Toros Tarım constitutes one of the four major businesses of Tekfen Holding, which is also active in contracting, real estate development, manufacturing and trade. OCP is the world’s largest exporter of phosphate and derivatives; it has some 20,000 employees and reported 4.5 billion dollars in sales in 2010, i.e. 3.5% of Morocco’s GDP and just over 25% of its total exports. OCP produces four types of fertilizers from phosphoric acid: DAP, TSP, MAP and NPK.

India: Coromandel Plans a New SSP Plant

Fertilizer maker Coromandel International is setting up a green-field SSP in Punjab at a cost of over 21 million US dollars. The 800 tonne per day unit, including a 400 tonne per day granulator plant, is expected to be ready within two years. The company’s move to sharpen focus on the SSP segment comes on the back of spiralling phosphate fertilizer prices. World phosphate demand is forecasted to grow at an annual rate of 2.3 percent in the next five years period.

China: Hubei Xingfa Acquires Phosphate Ore Assets

Hubei Xingfa Chemicals Group, which produces phosphate and other chemicals intended for agricultural use, has fully acquired Hubei Yichang Phosphide Group from controlling shareholder Yichang Xingfa Group for 331.98 million yuan (about US$ 52.5 million).

Phosphide Group’s subsidiary has mining rights to two phosphate ores mines with total available reserves of over 60 million tonnes and a total production capacity of over 2 million tonnes per year.

Xingfa Chemicals Group has about 160 million tonnes of phosphate reserves, with an annual production capacity of nearly 3 million tonnes at present.

The development of a phosphate ore mine reportedly requires an investment of some US$ 45-50 million, with an infrastructure development period of 2-3 years.

Currently, the Phosphide Group’s two mines are still being prepared for infrastructure development and are unlikely to make a significant contribution to the actual output before 2014. Significant funds need to be invested in construction over the next two years.

Founded in 1994, Hubei Xingfa Chemicals Group Co., Ltd (Hubei Xingfa) is located in Xingshan County, Yichang City, Hubei Province. Hubei Xingfa as the largest phosphates production base in central China, has technical grade, food grade, toothpaste grade, and feed grade products: sodium tripolyphosphate 280,000 tpa STPP, yellow phosphorus 75,000 tpa, sodium hexametaphosphate 66,000 tpa, dimethyl sulfoxide 20,000 tpa, sodium hypophosphite 11,000 tpa, phosphorus pentasulphide 6,000 tpa , sodium acid pyrophosphate 10,000 tpa. Their strategy for the next years is to achieve the upgrading from technical grade products to food grade and electronic grade products, from inorganic phosphates to organic phosphates, and develop non-phosphate fine chemical products.

India: FACT Fertilizer Expansion Projects

The public sector undertaking Fertilizer and Chemicals Travancore Ltd. (FACT) has expansion plants that include a new sulphuric acid plant, a urea plant, Nitrogen-Phosphate (NP) complex fertilizer plant, a SSP plant and an ammonia-urea complex. Almost all the projects will be set up at the FACT Cochin and Udyogamandal divisions. FACT is also considering the possibility of combining the 2,000 tonnes per day sulphuric acid plant and the 1,000 tpd NP plant as a single block and the urea plants as a separate block. Further, the company is looking to set up an integrated ammonia-urea complex which will have a production capacity of 2,800 tpd of ammonia and 3,500 tpd of urea. FACT will set up an integrated complex fertilizer production facility at the company’s Kochi division capable of manufacturing multiple NP grades. This will help FACT increase its complex fertilizer production to 1 million tonnes annually. The company will also set up a urea plant with production capacity of 1,500 tpd at its Udyogamandal division. The sulphuric acid plant will have a nameplate production capacity of 2000 tpd and the SSP plant 500 tpd.

Located in India’s west coast, FACT is also examining the possibility of setting up a gypsum park and it is looking at a proposed LNG terminal in Kochi to serve as a gas link for both feedstock and fuel instead of naphtha and furnace oil.

FACT is a state-run company which besides fertilizers, has also interests in caprolactam (an intermediate used in nylon production), petrochemicals, hydrometallurgy, pharmaceuticals, engineering services, and others. During the fiscal year 2011, the company produced 245,380 metric tonnes of sulphuric acid and 36,050 metric tonnes of phosphoric acid. They have over 3,000 employees.

Ethiopia: Potash and the Country Infrastructure Building

Ethiopia, sub-Saharan Africa’s second-most populous nation, is in the middle of a five-year plan to modernize and upgrade its infrastructure and industries. The government last year signed two agreements with Chinese companies to build a 4,744 kilometer rail network to Djibouti.

Landlocked Ethiopia lost its access to the sea after Eritrea voted for independence in 1993. The new rail line will run between the cities of Mekele and Hara Gebaya.

Toronto-headquartered Allana Potash Corp., Sainik Potash Plc of India, Ethiopian Potash Corp. and Melbourne-based BHP Billiton Ltd. are all developing projects to extract potash in the Afar region. Allana Potash Corp. is a junior mining company with a focus on the acquisition and development of potash assets internationally with its flagship in the Danakhil Potash property (also referred to as the Dallol Potash Project), which is a previously explored potash property in northeastern Ethiopia. The Ethiopian Potash Corp. is a mineral resources company engaged in the acquisition, exploration and development of mineral properties in Eastern Africa and in 2011 they acquired an interest in the Danakil Potash Permits. The estimated capacity for the Dallol project is 1-1.5 million tons potash per year, with resources of more than 30 years mining. A feasibility study work on the project is in progress and scheduled for completion in the third quarter of 2012. The study includes hydrogeological studies to identify large water sources, dissolution testwork, rock mechanical testwork, a pilot solution mining operation, and solar evaporation pond tests.

Ethiopia signed a US$ 1.5 billion agreement with state-run China Communications Construction Co. to build a railway to carry potash from mines being developed in the nation’s northeast. The 360-kilometer line will transport passengers and freight along a route to neighboring Djibouti’s Tadjourah port, which is being built. It should be completed by July 2015. The Chinese government-owned transportation infrastructure company CCCC will be mobilizing substantial resources to guarantee completion of the project. They have a market capitalization of about 12.8 billion dollar, and over 90,000 employees.

Global demand for fertilizer is rising steadily as tight market conditions for oilseeds and corn are giving farmers an incentive to boost production. But the nutrients increase will be higher for potash. According to Paris-based IFA, in the next years average annual growth in potash demand is seen at 3.7 percent, compared with 2.3 percent for phosphates and 1.5 percent for nitrogen fertilizer.

Vietnam: More Regulation on the Fertilizer Market

Fertilizer production and trade in Vietnam will now be overseen more tightly under a new decree by which there will be a more orderly classified. The decree’s strict regulations are necessary as a great number of fake and low-quality fertilizers are on the market, causing losses for farmers. Inspections of the authorities showed last year that over half of the fertilizers on the market were substandard or fake. Most recently, inspectors discovered the Viet Phap Science, Technology and Investment Corporation in Ha Noi’s Thanh Tri District producing over 60 tonnes of NPK fertilizer fraudulently under the trademark of the Lam Thao Fertilisers and Chemicals Joint Stock Co.

Vietnam national demand for NPK fertilizer is 3.5 million tonnes, but the existing plants can only supply a combined 3.42 million tonnes. According to the figures of the General Department of Customs, as of June 15, 2012, the country had imported 104,000 tonnes of NPK fertilizer worth nearly US$ 51.2 million, up 2% year-on-year.

New NPK fertilizer plants to start operation in the next 1-2 years. Binh Dien Fertilizer Co. plans to develop two NPK fertilizer plants in Ninh Binh and Dong Nai provinces with respective output capacity of 150,000 and 200,000 tonnes per year. The PetroVietnam Fertilizer and Chemicals Corporation (PVFCCo) is currently implementing a NPK project in Nam Dinh, with an annual capacity of 100,000 tonnes.

Last June, the Ministry of Agriculture and Rural Development (MARD) of Vietnam reported that the export value of Vietnam’s agricultural, forestry and seafood sector is forecast to reach US$13.67 billion in the first half of 2012, a year-on-year increase of 14.5%.

Morocco: OCP plans to increase phosacid capacity

Morocco’s giant phosphate maker OCP plans to increase phosphoric acid capacity in 2013 to utilize its excess granulation capability. The African Development Bank has loaned US$ 250 million (193 million euros) to help development in Morocco’s phosphate industry, which accounts for nearly a third of exports. The funds will pay for the construction of an industrial platform at Jorf Lasfar (south of Rabat), which will eventually accommodate several chemical complexes in order to increase capacity for the local transformation of phosphate into phosphoric acid and fertilizer. Exports of phosphates and derived products account for almost a third of Morocco’s international sales. These exports in 2011 increased by 31.8 percent, for a total turnover of about five billion euros. The OCP employs more than 20,000 people.