BultiesBrothers schreef op 20 december 2021 17:59:
December 15, 2021
11:51 AM CET
Last Updated 6 days ago
Commodities
Yara brings most European ammonia production back on stream
By Victoria Klesty and Nora Buli
2 minute read
A general view of the Yara ammonia plant in Porsgrunn, Norway August 9, 2017. REUTERS/Lefteris Karagiannopoulos/File Photo
A general view of the Yara ammonia plant in Porsgrunn, Norway August 9, 2017. REUTERS/Lefteris Karagiannopoulos/File Photo
Register now for FREE unlimited access to Reuters.com
Summary
High gas costs had prompted Yara to slash output
Rising fertiliser prices makes resumption profitable
Costly fertilisers are putting crops at risk
OSLO, Dec 15 (Reuters) - Yara (YAR.OL) has brought most of its European ammonia production back on line after prices of finished fertilisers rose to make up for a surge in the cost of gas, the Norwegian fertiliser manufacturer said on Wednesday.
The company cut back ammonia production at a number of sites in Europe from September through November following a jump in the price of the natural gas used in the manufacturing process, hitting its overall output in the region by 30%.
Fertiliser prices have risen sharply this year tracking higher energy costs, putting key crops at risk and adding to global food security and inflation fears, analysts say.
"The price of finished nitrogen fertiliser has risen in the quarter to a level where it has been profitable for us to start up production and, in addition, the global ammonia price has also risen," a Yara spokesperson said.The company said in a statement that while it aimed to keep supplying customers, it couldn't rule out cutting back ammonia production again if necessary.
Rivals including CF Industries Holdings (CF.N) have also cut production.
Including maintenance and unscheduled outages, Yara's European ammonia production was approximately 370,000 tonnes below capacity during the curtailments.
"The impact on finished fertiliser production has been limited, as unprofitable ammonia production has been replaced with sourcing from Yara plants outside Europe, and from Yara's global ammonia trade and shipping network," the company said.
Chief Executive Svein Tore Holsether told Reuters last month that some capacity at Yara's Dutch plants had already been brought back on stream.
European wholesale gas prices have surged as much as 700% this year as demand recovered rapidly from a pandemic slump at a time of low storage levels and supply constraints.
As of Tuesday, the European benchmark was 570% higher than at the start of 2021.
As a result of supply constraints, farmers in Europe have scrambled to buy urea and liquid nitrogen at elevated prices for fear of running short in the planting season.
Yara has the capacity to produce 8.5 million tonnes of ammonia per year worldwide, with 4.9 million tonnes of that coming from Europe.
Ammonia is an ingredient in finished products used to fertilise crops but also goes into explosives and for cleaning exhaust from diesel engines, among other applications.
Ook dit, als Yara ondanks de hoge gasprijzen het alsnog lukt om de productie op te starten, dan moeten ze wel verwachtingen hebben dat of de gasprijs snel gaat zakken, of de kunstmestprijzen nog enige tijd lang hoog blijven. Dus deze opstart van Yara zie ik als een positief signaal. Want als Yara weer veel op de markt gaat brengen, dalen de prijzen, dus dan zou je denken dat het niet profitable is om weer te gaan produceren,. maar blijkbaar staan ze niet zo in the game.