IPL expects US ammonia plant shutdown to last a month

Market: Fertilizers
13/09/21

Australian fertilizer firm Incitec Pivot (IPL) expects a hurricane-driven shutdown at its 800,000 t/yr Waggaman ammonia plant in the US state of Louisiana to last until the end of September.

The plant was taken off line on 28 August in anticipation of Hurricane Ida. IPL has also declared force majeure on customer contracts for ammonia supplies from the plant, estimating a loss of earnings before interest and tax of around $28mn based on current market prices for ammonia and the planned plant restart schedule.

Hurricane Ida made landfall in Louisiana nearly two weeks ago, forcing other ammonia plants to also go off line.

Inspections at the plant since the hurricane have not identified any material damage, IPL said. "The plant's restart has been awaiting restoration of high-voltage industrial power and utilities from third-party providers," it added.

Argus assessed US Gulf coast ammonia prices at $620/t cfr on 9 September, unchanged from the previous week.

By Aabha Gandhi 

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

03/04/25

Trump to 'stand firm' on tariffs as markets crash

Washington, 3 April (Argus) — President Donald Trump does not intend to back down from his plan for sweeping import tariffs that have already caused a sell-off in global equity markets and some commodities, administration officials say. The tariffs — which will start at 10pc for most imports on 5 April before steeper country-specific tariffs take effect on 9 April, with exceptions for some energy and mineral imports — have caused key stock indexes to drop by as much as 5pc, with even larger declines in crude futures, as investors brace for lower growth and a higher chance of a recession. Trump earlier today defended the tariffs, as he prepared to leave the White House for a dinner tonight at a golf tournament at one of his resorts in Florida. "THE OPERATION IS OVER! THE PATIENT LIVED, AND IS HEALING," Trump wrote in a social media post before major stock markets opened. Trump's cabinet has downplayed the short-term price effect of the tariffs, which they say will boost economic growth in the US and cause a resurgence in domestic manufacturing. US commerce secretary Howard Lutnick said he does not think there is "any chance" that Trump will rescind the tariffs, and said Trump will only begin to work on new trade deals once a country has "really, really changed their ways" on trade practices. "Trump is going to stand firm because he is reordering global trade," Lutnick said today in an interview with CNN. "Make no mistake about it, America has been exploited, and he is done allowing America to be exploited." Other administration officials have suggested a greater potential for lower tariffs in the near-term. US treasury secretary Scott Bessent has encouraged world leaders to "take a deep breath" and not to "panic" because the tariff rates that Trump announced were a "ceiling" that might come down, so long as there was no retaliation. "Don't immediately retaliate, let's see where this goes, because if you retaliate, that's how we get escalation," Bessent said on 2 April during interview on Fox News. The tariffs have caused bipartisan backlash on Capitol Hill, but so far legislative action has been symbolic and unlikely to become law. The US Senate, in a bipartisan vote on 2 April, approved a joint resolution that would end the justification Trump has used to put tariffs on Canada. US senators Chuck Grassley (R-Iowa) and Maria Cantwell (D-Washington) introduced a bill today to eliminate most new presidential tariffs after 60 days without approval by the US Congress. Democrats say the tariffs will force consumers to pay far more on everyday goods, with revenue offsetting Republican plans to provide more than $5 trillion in tax cuts. "Donald Trump is using tariffs in the dumbest way imaginable. In fact, Donald Trump slapped tariffs on penguins and not on Putin," US Senate minority leader Chuck Schumer (D-New York) said today, in reference to Trump's decision to put a 10pc tariff on an island populated only with penguins. Trump has claimed his country-specific tariffs are "reciprocal" even though they have no relation to the tariffs each country charges on US imports. Instead, Trump's tariffs were calculated based on a universal equation that is set at half of the country's trade deficit with the US, divided by the country's imports from the US, with a minimum tariff rate of 10pc. US major trading partners are preparing for retaliatory tariffs. Canada's prime minister Mark Carney said he would respond to Trump's tariffs on automobiles, which took effect today, by "matching the US approach" and imposing a 25pc tariff on auto imports that do not comply with the US-Mexico-Canada free trade agreement. China said it was preparing unspecified countermeasures to US tariffs that would be set at 54pc. Trump's cabinet today dismissed the market reaction to the tariffs. Stock markets are going through a "short-term adjustment" but the tariffs will ultimately result in more growth and additional investments, US Small Business Administration administrator Kelly Loeffler said today in an interview on Fox News "The gravy train is over for the globalist elites," said Loeffler, who previously was a top executive at US exchange operator ICE. By Chris Knight Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Find out more

News

Indian DAP subsidy increase falls short

03/04/25

News

03/04/25

Indian DAP subsidy increase falls short

London, 3 April (Argus) — Rebuilding India's DAP inventories remains an uphill struggle as the latest subsidies and current market prices keep importers' and many producers' margins in the red, despite a rise in the subsidy. India will have to keep relying on NPKs/NPs to cover much of its phosphate needs. The Indian government has set the nutrient-based subsidy (NBS) for DAP for the April-September kharif season at 27,799 rupees/t. This is an increase of Rs5,888/t from the base subsidy for the October-March rabi season. The government will probably extend the Rs3,500/t special additional subsidy for DAP into kharif, bringing the total subsidy for DAP up to Rs31,299/t. The maximum retail price (MRP) for DAP will remain at Rs27,000/t. DAP importers face losses The new subsidy rate, including the special additional subsidy, brings the breakeven import price for DAP to the low $600s/t cfr at the current exchange rate and MRP. This is well below the latest concluded level in the high $640s/t cfr, and almost $60/t below latest offers. Without the Rs3,500/t special additional subsidy, the breakeven import price would be around $563/t cfr. The government will probably commit to compensating importers for losses on DAP over kharif, but there has not yet been official confirmation. The department of fertilizers said in September last year that it would compensate importers for losses on DAP over rabi. But some importers said that they have not yet received this compensation. NPKs more attractive for many producers Indian DAP producers using phosphoric acid and ammonia imported at $1,153/t P2O5 cfr and $350/t cfr, respectively, now face losses of $25/t, given the current NBS, MRP and exchange rate. The second-quarter contract price for merchant-grade phosphoric acid to India is up by $98/t P2O5 from the first-quarter price of $1,055/t P2O5 cfr. The rise in the acid price was driven by soaring sulphur costs, firmer sentiment for DAP and falling ammonia prices — which are down from a midpoint of $440/t cfr at the start of the calendar year. Those producers using phosphoric acid will be drawn to the profits to be gained from making NPKs. The new subsidies for 10-26-26 and 12-32-16 are Rs16,257/t and Rs19,495/t, respectively. Both grades have an MRP of Rs35,000/t. At current phosphoric acid, ammonia and potash — with MOP at $283/t cfr with 180 days credit — import costs and exchange rates, Indian producers would see profits of around $48/t for 10-26-26 and $54/t for 12-32-16. DAP producers using imported phosphate rock, sulphur and ammonia will make a profit. Producers importing 30-31pc P2O5 phosphate rock at $153/t cfr, dry bulk sulphur at $280/t and ammonia at $350/t cfr now see margins of around $66/t. Phosphate rock prices have held broadly steady over recent quarters. The fall in ammonia costs has helped to counter the bull run in the global sulphur market, which has pushed up dry bulk sulphur cfr prices in India by $91/t at the midpoint since the beginning of 2025. Without the Rs3,500/t special additional subsidy on DAP, the loss for producers using imported phosphoric acid and ammonia would rise to around $66/t. And the margin for producers using imported phosphate rock, sulphur and ammonia would fall to around $25/t. Producers generally cannot switch between using phosphoric acid and using phosphate rock and sulphur. The Indian government did not cover the losses incurred by DAP producers over rabi — forcing many producers to turn to making NPKs/NPs instead. Although speculation has emerged that the government will compensate producers over kharif, there has been no official indication either way. DAP stocks to remain low Provisional data indicate that India ended March with around 1.3mn t of DAP in stock, still well below the perceived comfortable minimum of 2mn t. Indian distributors will want to build DAP stocks ahead of the peak offtake season — beginning around June. But while importers and producers continue to face losses, stocks will remain low and many farmers will again have to settle for NPKs/NPs as an alternative source of phosphate. By Tom Hampson Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

News

Aglobis, ECM sign sulphur remelter engineering deal

03/04/25

News

03/04/25

Aglobis, ECM sign sulphur remelter engineering deal

London, 3 April (Argus) — European sulphur and sulphuric acid marketer and distributor Aglobis announced today the signing of an extended basic agreement with engineering service provider ECM to develop its 400,000 t/yr sulphur remelter plant in Duisburg, Germany. Under this agreement, Sulphurnet will act as a sub-contractor to ECM, for sulphur processing technology. Construction is expected to start in 7–8 months following planning and technical design. Engineering activities have already started. This follows the announcement in early January of an agreement with Engie Deutschland for energy provision in the form of steam and utilities for its planned Duisburg sulphur remelter. By Maria Mosquera Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

News

India ends fertilizer year with 1.3mn t in DAP stocks

03/04/25

News

03/04/25

India ends fertilizer year with 1.3mn t in DAP stocks

London, 3 April (Argus) — Low offtake in the first quarter of 2025 allowed Indian DAP stocks to build to about 1.3mn t by the end of the fertilizer year in March, but lower production and imports have put a ceiling to stock building, according to provisional data. DAP reserves began this month at 1.29mn t, with provisional offtake, production and import data suggesting a stock drawdown — production plus imports minus sales — of 12,000t on the month. Provisional March DAP offtake totalled 280,000t, bringing offtake this quarter to 978,000t, well below the 1.4mn t/yr average in 2021-24. In the fertilizer year spanning April 2024-March 2025, national offtake totalled 9.3mn t, compared with 10.8mn t in the previous year. A lack of DAP availability across parts of India, spurred by low imports and domestic production, has supported interest in NPKs. Domestic DAP output in March totalled 118,000t, reaching 3.76mn t in April 2024-March 2025. This is below the 4.2mn t/yr average in April 2020-March 2024. And March DAP imports totalled 150,000t, with 4.7mn t imported over April 2024-March 2025, line-up data show. This is well below the 5.6mn t/yr average in April 2020-March 2024. DAP importers and producers using phosphoric acid faced negative margins in most of the fertilizer year, given the maximum retail price, nutrient-based subsidy, exchange rates and market cfr prices for DAP and raw materials. This drove private-sector importers out of the market and encouraged producers using imported phosphoric acid to focus their output on NPKs, which gave better margins. Importers appear to have been dissuaded by high international DAP cfr prices in particular. The Indian DAP assessment peaked in October — during the high buying season — at $643/t cfr on a midpoint basis, remaining below $600/t cfr a year before. And prices were prevented from slipping in the off-season, supported by the absence of Chinese DAP exports and Ethiopia's switch to DAP imports from NPS. The assessed range has firmed in recent weeks, with Saudi Arabian producer Ma'aden selling 50,000t of DAP to an Indian importer in the high $640s/t cfr for loading in early April . DAP offers are now as high as $660/t cfr. DAP stocks are now well below a comfortable 2mn t, and India will have to keep building reserves in its off-season before farmers' demand picks up around the middle of the year. The Indian government at the end of March raised the nutrient-based subsidy for phosphates for the kharif season by 42pc. At current market prices, DAP importers' margins will remain negative. The government will probably continue to compensate importers for losses on DAP, but there is no indication that Indian DAP producers will receive compensation for losses. By Adrien Seewald Indian DAP stocks and sales '000t Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

News

No US tariffs on sulphur imports from Canada

03/04/25

News

03/04/25

No US tariffs on sulphur imports from Canada

London, 3 April (Argus) — Sulphur from Canada, which is by far the US' largest supplier, is not expected to be covered by the sweeping tariffs announced by President Donald Trump on 2 April. US sulphur imports from Canada totalled 830,000t in 2024 according to the US Geological Survey, with the rest of the world supplying just 60,000t. Trump exempted many energy and mineral products from tariffs unveiled on 2 April. Sulphur was not on the list of exemptions, but is understood to be covered by the US-Mexico-Canada free trade agreement, so should continue to be imported without tariffs. Sulphur imports from countries other than Canada and Mexico are believed to be subject to a 25pc tariff. US sulphur consumers would face higher prices if Canadian flows are subject to tariffs at a later date. Trump has threatened Canada and Mexico with further tariffs. He briefly imposed a 25pc levy on sulphur from Canada in February, only to suspend this days later. By Maria Mosquera Send comments and request more information at feedback@argusmedia.com Copyright © 2025. 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