Intrepid to up 2024 potash output 10-15pc

Market: Fertilizers
08/03/24

US fertilizer producer Intrepid Potash plans to increase its output this year by 10-15pc after seeing a large decline in 2023.

Intrepid last year produced 224,000 short tons (st) of potash, down by 17pc from 2022, and during the fourth quarter of 2023 produced 79,000st, down from 25pc in the fourth quarter of 2022. The declining trend was the result of higher producing costs and lower potash prices, but the company expects the spring application season to increase demand. The failure of an extraction well in New Mexico was also attributed to the output decline and is currently being replaced.

After this year's planned 10-15pc increase, the company plans an additional 10-15pc increase in 2025.

"Market potash pricing has also recently stabilized at levels that are 35pc higher than the previous cycle, and we expect our sales to remain steady ahead of spring applications," said to Intrepid chief executive Robert Jornayvaz.

Intrepid expects to sell 65,000-70,000st of potash in the first quarter of 2024. The producer sold 45,000st during the fourth quarter, down by 10pc from the fourth quarter in 2022, and sold 258,000st in 2023, up by 16pc from 2022.

Total sales for the fourth quarter were $56.7mn, down from $66.7mn a year earlier. Full year 2023 sales were $279.1mn, down from $337.6mn a year earlier. Intrepid posted a net loss of $37.3mn for the fourth quarter, compared with a net profit of $4mn a year earlier.

Capital expenditures for 2023 were on the lower end of Intrepid's guidance at $65.1mn while 2024 spending guidance will range from $40mn-50mn. The slowdown in spending will be a result of the company focusing to complete projects such as the HB Solution Mine and the Intrepid South sand project in New Mexico and the Brine Recovery Mine in Utah.

"Our growth capital is focused on improving the production rates at our solar solution potash assets, which on a combined basis, have had a declining production profile since 2017," the company said.

By Taylor Zavala

Related news posts

Argus illuminates the markets by putting a lens on the areas that matter most to you. The market news and commentary we publish reveals vital insights that enable you to make stronger, well-informed decisions. Explore a selection of news stories related to this one.

News

30/12/24

Viewpoint: US acid market in west to east split in 2025

Houston, 30 December (Argus) — Vastly different dynamics are expected for the western and eastern US sulphuric acid markets in 2025. Lower output from producers in the western US and Canada will keep supply constrained for much of 2025, likely driving west coast US sulphuric acid imports higher during the year. But balanced dynamics will keep the southeastern US and Gulf coast markets competitive, shielding both regions from the global market dynamics. Deliveries of sulphuric acid to the US west coast from January-October of 2024 climbed by 35pc on the year to 188,700t, according to US Census data, making up for lower-than-expected output from producers, which squeezed availability throughout the region. The closure of Simplot's Lathrop, California, sulphur burner at the beginning of 2024 had already reduced baseline supply on the US west coast. Market sources expect output at Teck's Trail Operations in British Columbia, Canada, to be reduced through at least the first half of 2025 because of technical issues with the facility's electrolytic zinc plant following a fire in late September. Sources said that less volumes were available from the company's western Canadian facility during annual contract negotiations this year as a result. In its third quarter earnings release Teck reduced outlook for 2024 zinc production from its Trail Operations facility by 13.3pc as a result of the fire at the plant, but has not provided guidance for byproduct acid production or zinc production in 2025. In Utah, lower output from Rio Tinto's 1mn t/yr Kennecott smelter is expected to continue into 2025. Reduced copper ore quality has contributed to lower copper concentrate production from the facility. The company is expected to continue to purchase copper concentrate from a third-party supplier to support smelter utilization. Balance rules in the east But in the eastern US, steady output from domestic producers has matched, and sometimes outpaced, demand in the region. This trend has kept prices relatively steady and spot import demand reduced from previous levels. Despite a 6.3pc year to year increase to total US sulphuric acid imports during January-October to 2.9mn t, the bulk of the increase came from higher volumes of spot imports into Houston, Texas, according to US Census data. Deliveries to other major ports in the US Gulf and east coast sank by 28pc. Deliveries of sulphuric acid into the port of Houston from January-October jumped to 264,200t, more than doubling the 115,100t arriving during the same period in 2023. Sulphuric acid imports to other ports in the Gulf coast and east coast fell significantly from January-October, dropping by 28pc to 359,800t compared with 497,900t during the same time in 2023. Spot trade into the US Gulf coast and southeast has been quiet for much of the year, aside from consistent spot shipments into Houston. Market participants expect the balanced nature of the market to continue through much of 2025, reducing the need for imports on contract and spot basis. Prices in a tightly-supplied global merchant market remain largely uneconomic for US-based distributors. The imbalanced relationship of prices in the US and the merchant market has kept bids far from offers, slowing spot trade into the Gulf coast and southeast. By Chris Mullins Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Find out more

News

QatarEnergy Marketing raises Jan sulphur price by $3/t

30/12/24

News

30/12/24

QatarEnergy Marketing raises Jan sulphur price by $3/t

London, 30 December (Argus) — State-owned QatarEnergy Marketing raised its January Qatar Sulphur Price (QSP) to $166/t fob, up by $3/t from December's $163/t fob Ras Laffan/Mesaieed. The January QSP implies a delivered price to China of $185-191/t at current freight rates, which were last assessed on 19 December at $19-21/t to south China and $23-25/t to Chinese river ports for a 30,000-35,000t shipment. The announced montly QSP fob price has risen by $92/t over a year, from $74/t fob Qatar in January 2024. By Maria Mosquera Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

News

Viewpoint: Brazil urea deals for corn delayed to 2025

27/12/24

News

27/12/24

Viewpoint: Brazil urea deals for corn delayed to 2025

Sao Paulo, 27 December (Argus) — Brazil is set to enter 2025 with a last-minute surge in demand for nitrogen-based fertilizers, as farmers continue to postpone purchases for the 2024-25 second corn crop. Around 10-15pc of all fertilizer needs have yet to be purchased for the corn crop, whose planting is expected to start by February in central-western Mato Grosso state. Brazilian farmers have been delaying agreements for inputs as they wait for lower fertilizer prices and higher grain prices. The most delayed fertilizer acquisition is urea, with buyers expecting further price drops before committing to volumes. Granular urea prices were at $359/metric tonnes (t) cfr Brazil by 19 December, $39/t above the same period in 2023. The overall pace of input purchases is in line with farmers' buying patterns for the 2023-24 corn crop and 2024-25 soybean crop, when growers also waited until the last minute to secure final volumes. Traditional 4Q buying surged delayed Brazilian buyers used to speed up the pace of fertilizer purchases in the fourth quarter to supply the second corn crop. This would give them time to receive the inputs in time for application, without last-minute logistic concerns. But unexpected changes in fertilizer price trends, combined with changes in the timing of the soybean crop, led farmers to change this buying pattern and wait as long as possible before concluding deals. Farmers' saw this last-minute buying strategy rewarded in early 2024 when urea prices were about $393/t cfr Brazil, below levels seen earlier in October 2023. And a delay in the 2024-25 soybean planting because of unfavorable weather conditions also contributed to postponed fertilizer acquisitions for corn, since the soybean harvest would likely be delayed and force farmers to plant corn outside the ideal period. Those factors are set to again push final urea purchases to January. Some volumes traded in November-December may discharge in ports in January, intensifying deliveries in the first months of the year. Brazil imported 7.6mn t of urea in January-November, 19pc above the same period in 2023. The latest lineup data from 26 December points to around 400,000t to be delivered at ports in December and 422,000t in January, according to maritime agency Unimar. Farmers focused on acquiring ammonium sulphate (amsul) volumes in the past three months, as prices carried a discount considering the nitrogen content compared with urea while also adding sulphur. There is plenty of available compacted/granular amsul, with Chinese producers eyeing Brazil as an outlet for the product. Imports of amsul totaled 5.1mn t in the first 11 months of the year, 18pc above the same period last year. A total of 596,000t and 1.2mn t were set to discharge in ports in December and January, respectively, according to Unimar's lineup data from 26 December. The trend is the same in the domestic market, with purchases advancing slowly. Some cooperatives and retailers bought volumes to guarantee availability when farmers decide to buy. Farmers are most advanced in theirs potash (MOP) acquisitions, as its lower-than-usual price has motivated farmers to buy the fertilizer for 2025-26 corn and soybeans. Market participants estimate that around 50pc of MOP needs in Mato Grosso for the 2025-26 soybean crop were purchased by early December. Demand has been high for the first quarter of 2025, leading to expectations of intense MOP deliveries at ports. This would mean a high flow in the inland market, competing with urea volumes handling in January-February. By Gisele Augusto Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

News

Viewpoint: US amsul demand to stretch supply in 1Q

26/12/24

News

26/12/24

Viewpoint: US amsul demand to stretch supply in 1Q

Houston, 26 December (Argus) — US ammonium sulfate (amsul) prices are likely to remain elevated through the first quarter of 2025 because of increased demand, high feedstock costs and more forward purchases as buyers look to avoid the high prices seen last spring. Scarcity seen in the 2023-2024 fertilizer year in the US amsul market has continued into 2024-2025. Strong demand has drained US inventories, despite rising domestic production in the third quarter, which increased by 11pc to 4.8mn short tons (st) compared to the five-year average of 4.25mn st, according to data from The Fertilizer Institute (TFI). But production in the fourth quarter has fallen because of extended plant downtime. Major production facilities such as AdvanSix's 1.75mn st Hopewell, Virginia, plant and Nutrien's 700,000 metric tonne (t) Redwater, Alberta, plant underwent prolonged turnarounds in the fourth quarter, according to sources. The unplanned downtime reduced the availability of pre-pay volumes in the market and caused at least one producer to partly cover their reduced output by purchasing imports. But imports have only provided the US market with limited supply relief. Year-over-year, US imports are lagging by 17pc from July through October. Around 282,700t of amsul entered the US during the period, compared to the 338,600t that arrived in the same period last year. This year's imports are still 11pc greater than the five-year average, illustrating the trend of demand growth in the US. Increasing feedstock costs have also supported amsul prices through the back-half of 2024. Fertilizer producer IOC said higher feedstock costs were the primary driver of its fourth quarter price hike at the start of October. Feedstock ammonia prices are expected to slip or remain stable for January because of seasonal weakness and lower global prices, said sources. Feedstock sulfur market prices on the other hand have risen over the period and may incur a $20-30/st increase because of rising global demand, according to market participants. Amsul's relationship status update Amsul values slipped in December and early January of last year, allowing the market to buy at lower values before the spring season. The opposite is anticipated to occur this year after major producers AdvanSix and IOC increased their offers for first quarter pre-pay delivery in December. Despite the rising price of amsul, buyers have been lining up more forward deliveries this fall than other years, according to sources. In lieu of hand-to-mouth buying and rising prices last spring, buyers are looking to hedge against potential volatility in the back half of the fertilizer year. Bolstered demand has led to additional price strength which is expected to persist through the winter season. Demand for ammonium sulfate arrived earlier than usual but it is unclear whether it will resurface as strong in the spring. Amsul price in the US Corn Belt recently rose to an average of $380/st, 20pc above the average price in December of last year. Amsul prices typically rise in the spring season when applications begin, so amsul values would appreciate even further if that trend occurs this year. By Meghan Yoyotte Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

News

Viewpoint: Tight US phosphate supply may ease

23/12/24

News

23/12/24

Viewpoint: Tight US phosphate supply may ease

Houston, 23 December (Argus) — US phosphate buyers expect tight supply to ease next year after a lackluster fall application season left bins fuller, while unfavorable affordability will likely curtail spring demand. Tight P2O5 supply concerns driven by supply disruptions were of frequent concern among market participants earlier this year when DAP prices were roughly $80-100/st higher than price levels at the start of this December and MAP prices were at least $20/st higher. In May, a brush fire at major US phosphate producer Mosaic's Riverview facility in Florida caused a decrease in output. Market fundamentals tightened further throughout the summer and into early fall because of several hurricanes that made landfall in Louisiana and Florida, which reduced production from Mosaic and producer Nutrien's facilities. Higher phosphate values, lower crop prices and the resulting deterioration in affordability in the last six months of 2024 compared to 2023 deterred farmer buying interest. Some US buyers bought more triple superphosphate (TSP) throughout the summer as it became more economically appealing for the fall despite its lower nutrient content relative to MAP or DAP. The overall disinterest from farmers to use phosphate products this fall left higher-than-expected inventories across the Corn Belt that will carry over into next year and likely alleviate supply concerns along the Mississippi River for this spring. The US for the 2024/25 fertilizer year so far has imported less DAP and MAP compared with previous years, likely a result of poor affordability and farmer disinterest. Roughly 762,000 metric tonnes (t) of combined DAP and MAP were imported into the US from July through October, down from 34pc for the same period during the 2023/24 fertilizer year and 3pc lower than the five-year-average, according to US Census Bureau data. The absence of Moroccan producer OCP's phosphate products will continue to tighten US market fundamentals for the 2024/25 fertilizer year. The US Department of Commerce recently raised the phosphate import duty for OCP to 16.8pc from a preliminary rate of 14.2pc for calendar year 2022 and forward if it goes unchallenged. But most domestic buyers have been able to source product from elsewhere, like Jordan, Australia and Saudi Arabia. The US market also imported nearly 290,000t of TSP from July through October. That was 30pc higher than a year earlier and 70pc higher than the five-year-average, reflecting its recent appeal as a more affordable product. Affordability remains a headwind for demand in the spring as well. Based on the ratio between select phosphate barge prices and corn futures, farmer purchasing power for DAP and MAP has weakened throughout 2024 compared with 2023. This forces farmers to sell more of their crops to afford a ton of phosphate fertilizer. Market participants expect spring demand in 2025 to be lower than the robust demand seen last spring and for the market to be well supplied as a result. "Unless a big run on phosphate happens [this spring], we are looking at more supply than people know what to do with," one seller relayed. By Taylor Zavala Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Business intelligence reports

Get concise, trustworthy and unbiased analysis of the latest trends and developments in oil and energy markets. These reports are specially created for decision makers who don’t have time to track markets day-by-day, minute-by-minute.

Learn more