USDA awards more funding to increase fertilizer output

Spanish Market: Agriculture, Fertilizers
19/12/24

The US Department of Agriculture (USDA) awarded over $100mn this week across nine states to increase domestic fertilizer production as the effort to make farmer affordability more favorable continues.

About $116mn will be invested through the USDA's Fertilizer Production Expansion Program (FPEP) to help eight facilities expand output in California, Colorado, Georgia, Indiana, Iowa, Kansas, Michigan, Oklahoma and Wisconsin.

Recipients include the Michigan Potash Company, where the construction of a new facility should yield 400,000 metric tonnes (t) annually of high-grade potash, and Farmers Cooperative Association, where funding will expand its existing dry fertilizer facility with additional storage and processing capacity.

"When we invest in domestic supply chains, we drive down input costs and increase options for farmers," USDA secretary Tom Vilsack said.

Through the FPEP, the USDA has invested $517mn in 76 fertilizer production facilities across 34 states and Puerto Rico. President Joe Biden's administration committed up to $900mn in the program through the Commodity Credit Corporation, which is expected to support long-term investments by strengthening supply chains.

Higher US fertilizer prices throughout this year deterred fall demand as lower crop prices forced farmers to sell more of a crop to afford nutrients.

The last USDA FPEP funding announcement was in August, when $35mn was granted to boost seven domestic production projects.

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.

07/05/25

High sulphur prices pressure Indonesian buyers

Singapore, 7 May (Argus) — Steep increases in sulphur prices, against expectations of lower future nickel demand, and falling nickel prices since last year are pressuring metals producers in Indonesia, and some are considering postponing new projects. Sulphur is used as a raw material in the production of nickel intermediates such as nickel matte and mixed hydroxide precipitate (MHP), through the rotary kiln-electric furnace (RKEF) and high-pressure acid leaching (HPAL) processes, respectively. Producing 1t of MHP or nickel matte requires an estimated 10t and 15t of sulphur, respectively. Global sulphur prices began to rise in mid-2024 on firmer demand from Morocco and Indonesia. Morocco's OCP started up two sulphur burners last year that will consume 967,000 t/yr of sulphur at capacity. In Indonesia, newly commissioned HPAL production lines at QMB New Energy Materials and Halmahera Persada Lygend also added an estimated 830,000 t/yr of sulphur demand. Uncertainty over Kazakh and Russian sulphur export availability because of EU sanctions also created uncertainty over available supply in the region. Tighter supply, compounded by competing Chinese and Indonesian demand after the Lunar New Year holidays, spurred a rally in sulphur prices in the first quarter of the year. Fob Middle East sulphur prices more than tripled to $285.5/t fob as of 1 May from $86/t a year earlier, Argus assessments show. Cfr Indonesia granular sulphur prices rose by $185/t to $297/t cfr over the same period. While sulphur prices have risen significantly over the past year, prices for Indonesian-origin nickel intermediates have been largely rangebound at $12,000-14,000/t of nickel contained since January 2024. The comparatively flat nickel prices and the rising raw material prices mean that producers' margins are narrowing further. Gross profit margins for MHP products were close to $10,000/t in 2023 before falling to around $7,000/t in 2024, according to Argus estimates. Current sulphur prices take up around 40pc of the total production cost of nickel matte, the largest portion out of other raw materials such as caustic soda, according to one metals producer. And the increased adoption of non-nickel containing battery chemistries such as lithium-iron-phosphate and higher demand for plug-in hybrid electric vehicles have led the industry to revise its expectation of future nickel demand from the battery section. The International Nickel Study Group has forecast a nickel market surplus of 198,000t for 2025 , rising from 179,000t in 2024. But new ternary precursor cathode active materials projects will support a rise in nickel usage in the medium term, the group said. As higher raw material prices continue to chip away at producer margins, upcoming projects including QMB New Energy Materials' phase 3 in Morowali, and developments by Guangqing and Blue Sparkling Energy in Weda Bay may have to be postponed, market participants said. The three projects are expected on line this year, adding 844,000 t/yr of sulphur demand at capacity. By Chi Hin Ling, Deon Ngee Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

India's Hindalco buys Jordanian DAP at $719.50/t cfr

07/05/25

India's Hindalco buys Jordanian DAP at $719.50/t cfr

London, 7 May (Argus) — Indian fertilizer importer Hindalco has bought 45,000t of Jordanian DAP at $719.50/t cfr from a trading firm. The cargo will ship from Aqaba in early June, destined for India's west coast. The price is almost $20/t higher than Saudi Arabian producer Ma'aden's sale of 50,000t of DAP each to Indian importers Indian Potash (IPL) and Coromandel (CIL), reported earlier this week . There are no days of credit included in the concluded price. The trading firm probably bought the cargo at around $696/t fob for loading at the end of this month. By Tom Hampson Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

India launches attacks on Pakistan

06/05/25

India launches attacks on Pakistan

Houston, 6 May (Argus) — India's military said it launched attacks today against nine targets in Pakistan and Pakistan-occupied Jammu and Kashmir in retaliation for an April terrorist attack that killed dozens. India's ministry of defense said its strikes were a "precise and restrained response" to a 22 April incident near Pahalgam in Kashmir where 26 tourists were killed. They were focused on "terrorist infrastructure sites", the ministry said on the social media site X in a post Tuesday at 4:49pm ET. "Importantly, no Pakistani military facilities were hit, reflecting India's calibrated and non-escalatory approach," the ministry said. The government of Pakistan said on its own X account that five sites had been hit in the attacks. "Pakistan has every right to respond forcefully to this act of war imposed by India, and a forceful response is being given," the Pakistan government wrote. Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Low-carbon H2 hits the skids with offtake lagging

05/05/25

Low-carbon H2 hits the skids with offtake lagging

Houston, 5 May (Argus) — Multiple North American proposals to make hydrogen from natural gas with carbon capture have taken a pause as tariffs add to cost uncertainties and potential buyers balk at making long-term commitments at current prices. Dow has iced its Path2Zero ethylene plant in Alberta that is to use low-carbon hydrogen supplied by Linde. Air Products has delayed the start-up of a hydrogen and ammonia plant in Louisiana. And US nitrogen fertilizer producer LSB Industries said it is [pausing development] of an ammonia project on the Houston Ship Channel in Texas. Lower-carbon hydrogen produced from autothermal reforming with carbon capture and sequestration (CCS) is still expected to lead the nascent sector's development, with renewable-powered production seen as too costly for general takeoff. Most large-scale low-carbon hydrogen projects in the US have focused on exports in the form of ammonia or methanol to Asia and Europe, where governments have promised more support to implement decarbonization mandates. Long-term offtake agreements have so far lagged as regulatory uncertainty, cost concerns and now the added threat of US import tariffs muddle demand perspectives. "Demand has certainly ramped up slower than expected," said LSB chief executive Mark Behrman in an interview with Argus . "In the conversations that we've had with many offtakers in Asia and Europe, and even here domestically, there's been a lack of willingness to commit at the prices that we were able to talk about based on our capital costs," said Behrman, who also cited uncertainty around tariffs as a complicating factor. For long-term supply contracts, buyers were seeking prices below $600/metric tonne fob, said Behrman. LSB partnered with industrial gas firm Air Liquide, Japanese oil company Inpex and Vopak to build the 1.1mn t/yr ammonia facility in Texas. Air Liquide would supply the project with low-carbon hydrogen. The project's costs were largely calculated using 45Q tax credits that are awarded to companies using CCS to reduce emissions. But the release of 45V guidelines in January seemed to offer the possibility of accessing the more lucrative hydrogen production incentive because of a new section pertaining to cryogenic separation, a process that captures carbon dioxide from industrial gas streams, said LSB vice-president of clean energy, Jakob Krummenacher, while speaking at Argus' recent Green Ammonia North America conference in Houston. Cryogenic separation generates more steam than conventional solvent absorption and, if that steam is exported to another process, it may lower the carbon intensity of the resulting hydrogen to such an extent that the project could potentially qualify for 45V, Krummenacher said. As a result, many of the assumptions baked into the engineering studies related to the Houston ammonia venture have to go back to the drawing board. Air Liquide did not respond to requests for comment. If Air Liquide can avail itself of 45V, capital costs may decline and result in more competitive offers to the market. But Berhman cautioned against concluding the project will resume if it is found to qualify for 45V. "We still need a customer to move forward," Behrman said. Dow, which planned to build a hydrogen-fueled ethylene cracker at a petrochemical complex northeast of Edmonton, Alberta, paused its multibillion-dollar project citing uncertainty around US tariffs and the potential for retaliatory tariffs by US trading partners. Linde, which announced last year it would invest $2bn to build a low-carbon hydrogen facility to supply Dow's Path2Zero project, has not responded to questions about what Dow's pause means for its plans in Alberta. Linde has said it was working with Dow to them meet their goals while maintaining Linde's interest in the project. Air Products, meanwhile, further pushed back its $7bn Louisiana low-carbon hydrogen plant to late 2028 or early 2029 as it seeks to control costs by delegating CCS operations and ammonia production to partners. There have been some exceptions to the delays. Early last month, fertilizer producer CF Industries said it was moving ahead on a $4bn ammonia venture with Japan's Jera and investment firm Mitsui at its Blue Point complex in Louisiana. LSB similarly said it is forging ahead with plans to produce low-carbon ammonia at its existing plant in El Dorado, Arkansas, where it will decarbonize production by adding a CCS facility that will be operated by Lapis Carbon Solutions. "We're still big believers in global decarbonization," Behrman said. "I believe that new demand for power generation, power supply, and of course, the marine industry will evolve. I just think it's going to take longer than what everyone initially thought." By Jasmina Kelemen Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Mexico's manufacturing contraction deepens in April

05/05/25

Mexico's manufacturing contraction deepens in April

Mexico City, 5 May (Argus) — Activity in Mexico's manufacturing sector shrank for a 13th straight month in April, with declines accelerating in production and new orders, according to a survey of purchasing managers. The manufacturing purchasing managers' index (PMI) fell to 45.5 in April from 46.9 in March, finance executives' association IMEF said, moving further below the 50-point threshold that separates growth from contraction. US tariffs imposed since March are adding pressure to Mexico's manufacturing sector, which makes up about a fifth of the national economy. The auto industry, responsible for roughly 18pc of manufacturing GDP, may be the hardest hit by the new measures, including a 25pc tariff on auto parts that took effect 3 May. Mexico remains the top exporter of vehicles to the US, supplying 23pc of all US auto imports in 2024. But IMEF said tariffs compound broader, mostly domestic headwinds, including reduced public spending and investor uncertainty stemming from sweeping legal and regulatory reforms. New investment has stalled since late 2024. The PMI index for new orders fell by 2.5 points to 41.8, the lowest since June 2020. Production dropped by 2.5 points to 43.6, while employment fell by 0.6 point to 46.4. New orders and production have now been in contraction for 14 straight months, and employment for 15. Inventories saw the steepest drop in April, falling 4 points to 46.3 — sliding from expansion to contraction — as manufacturers accelerated shipments after tariff implementation dates were confirmed. IMEF's non-manufacturing PMI — which covers services and commerce — remained in contraction for a fifth consecutive month but edged up by 0.5 points to 49.0 in April. Within that index, new orders rose by 0.6 points to 48.1, employment increased 1.3 points to 48.6 and production held steady at 47.5. By James Young 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