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A tale of three countries

Summary

This review of developments in Bolivia, Paraguay and Uruguay is based on the paper by Dr. Ricardo Melgar, of INTA-Fertilizar, Argentina, entitled Rising Fertilizer Markets in Southern Latin America, which he presented at British Sulphur Events' 2007 Fertilizer Latin America conference.

Abstract

While the international fertilizer industry has concentrated its attention primarily on Brazil, the fourth largest market in the world, and on Argentina, by virtue of its potential as a world-ranking agricultural producer and ex­porter, these two countries share borders and strategic interests with neighbours which are in turn growing economically and which represent potentially large fertilizer markets.

Bolivia, Paraguay and Uruguay cluster between Argentina and Brazil. They are linked by a common river system that converges in a large agro-industrial export-based complex.

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Will macho politics jeopardise fertilizer investments?

Summary

In an echo of a previous era in Latin American politics, President Hugo Chávez has reasserted state control of Venezuela's oil and energy sector. The country has the largest natural gas reserves in Latin America but is not an exporter. FertiNitro, the Venezuelan nitrogen producer, had previously announced plans to expand ammonia and urea capacity. What are the prospects for these projects in the present adverse climate for investment, and as President Chávez forges closer diplomatic links elsewhere in Latin America, what are the prospects for other regional fertilizer projects?

Abstract

Since being elected as President in 1998, having attempted a coup in 1992, and in turn surviving an attempted coup in 2002, Hugo Chávez has been one of Latin America’s highest-profile – and controversial – leaders. He came to power on the promise of helping Vene­zuela’s poor majority, and his popularity at home has ensured his re-election in 2000 and 2006. President Chávez has proclaimed himself the leader of a Bolivarian Revolution, which is dedicated to his vision of democratic socialism and Latin American integration, and he is a vocal critic of neo-liberal globalisation and US foreign policy.

In his chosen role, President Chávez has flown in the face of the so-called Washington Consensus that now prevails among other governments in Latin America, as he supports alternative models of economic development, and he reversed many of the market-oriented economic reforms of the 1990s. Under President Chávez’s leadership, Venezuela has also withdrawn from the World Bank and the IMF and has em­barked on a vigorous programme of nationalisation, in marked contrast with the privatisations elsewhere in the region.

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Stepping on the gas

Summary

Bolivia is South America's poorest country but enjoys significant reser­ves of natural gas in terms of its size. As shown in Table 2, Bolivia's reserves are the second largest in Latin America.

Abstract

How best to exploit these gas reserves has proved a hugely contentious issue in Bolivia, which led to the downfall of two governments. These reserves had been ex­plored by the national oil company, Yacimientos Petroliferos Fiscales Bolivianos (YPFB), but after it was privatised in the mid-1990s, further exploration revealed vastly greater reserves. Under state ownership, YPFB had been unable to afford the requisite costs of exploration. Furthermore, Bolivia had been unable to find markets for its gas: topography and Bolivia’s landlocked status militated against LNG exports. A pipeline was constructed that linked the Bolivian gas fields to Brazil, this costing $2.2 billion – a project which prompted the privatisation of YPFB.

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Gazprom returns

Summary

Just four years after it lost control of most of its fertilizer empire, Gazprom is back. Its chemical production subsidiary, Sibur Holding, has formed a fertilizer production holding company, and with a risk-taking new general director at the helm, analysts predict that the company could dominate the Russian fertilizer sector within a few short years. Moscow-based correspondent Ben Seeder reports.

Abstract

Just four years after it lost control of its fertilizer assets in an embarrassing em­ployee-sponsored fraud, the gas giant’s obscure chemicals subsidiary is mounting a comeback campaign that could boost it to the upper echelons of the sector and give it the power to influence world nitrogen fertilizer markets.

In Russia’s dismal, blighted industrial hubs, where winter seems to last forever, a sea change in the chemicals industry is taking place. Since Russia emerged as a major exporter of fertilizers to the world market, the local sector has been dominated by the clever businessmen who snapped up the country’s rusty smoke-stack industries in the privatisation free-for-all that followed the collapse of the Soviet Union. But one decade later, as Russian agriculture recovers and the country prepares to join the World Trade Organisation (WTO), Russia’s fertilizer industry is being transformed – and potentially the biggest change centres on Gazprom.

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Shipping fertilizers faster

Summary

A global review of recent projects to enhance the shipping and distribution of fertilizers via the major deepwater ports.

Abstract

The booming world economy has benefited the international fertilizer industry, especially via high prices for crops and increased volumes of trade. This boom has also been very pronounced in the markets for other dry bulk commodities, creating an unprecedented demand for shipping. However, the boom has highlighted major bottlenecks in the shipping and distribution chain, especially at the ports. This review looks at some of the projects being undertaken to relieve the worst of the bottlenecks that impact on international fertilizer trade.

The biggest single logistical project and one that is timely and relevant to international fertilizer trade is the proposal to expand the capacity of the Panama Canal. This centres on the provision of a third set of locks, which will create a new lane of traffic along the Canal. It has been brought forward after earlier forecasts by the Pan­ama Canal Authority (ACP) were overtaken by events. The previous forecasts predicted a doubling in the Canal’s tonnage between 2005 and 2025, with the volumes transiting the Canal growing by an average 3%/year.

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Good timing in Boston

Summary

TFI's World Fertilizer Conference meets against a background of some very sound fundamentals.

Abstract

The Fertilizer Institute (TFI) holds its largest meeting, the World Fertilizer Conference, in Boston, Massachusetts, at the Westin Boston Waterfront on 17-20 September. The meeting draws delegates from around the world, from as many as 60 countries, making it a truly global event.

There are two keynote speakers this year. Prof. Jeffrey D. Sachs, will provide the keynote address at the breakfast session on Tuesday, 18 September. His topic is The End to Poverty: Economic Possibilities for Our Time.

The keynote speaker on Wednesday morning, 19 September is Dr. Elisio Contini. He will assess the outlook for biofuels.

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In focus in Florida

Summary

The Central Florida Section of AIChE held its 31st Annual Clearwater Conference at the familiar and welcoming venue of the Sheraton Sand Key Resort, examining current issues in sulphuric and phosphoric acid operations and technology. The meeting was once again a first-class forum for the exchange of ideas and viewpoints – and a thoroughly good social occasion to boot..

Abstract

At one level, the annual AIChE Clearwater Conference can be summed up as “phosphates by the surf”, but the meeting has the unique knack of combining serious intent with a relaxed and social ambience. It is certainly a forum for the best and the brightest in the sulphuric and phosphoric acid industries, typically attracting around 250 delegates, including strong participation from the contracting and equipment sectors. The meeting also offer­ed extramural attractions in the form of 12 hospitality suites, which were open on the evenings after the sessions, courtesy of companies supplying equipment, engineering and chemicals to the phosphate and sulphuric acid industry.

This year’s Clearwater meeting was held on Friday and Saturday, 8-9 June and consisted of two half-day sessions. The Friday afternoon session was the Annual Sulphuric Acid Workshop, the tenth in the series, and was chaired by Rick Davis and Jim Dougherty. Rick heads Davis & Associates Consulting Inc., while Jim is with Mosaic Co. Regular participants will know that this is invariably a lively session, the theme this year being sulphuric acid tower technology.

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Potash in complex ­fertilizers: the weakest link?

Summary

Potash can react with other raw materials such as ammonium nitrate and ammonium phosphate. This reaction can continue during storage and distribution, leading to caking. What can be done to make potash a more stable ingredient in complex fertilizers?

Abstract

While it is an essential ingredient in the manufacture of NPK fertilizers, potash can react with the other raw materials, especially ammonium nitrate and ammonium phosphate. Such reactions may for example result in caking. Continuing reactions may also result in a weakened physical quality, leading additionally to disintegration, high abrasion, increased dustiness and low crushing strength. (Potash in Complex Fertilizers: Inert or Complex, Harri Kiiski, Kemira GrowHow. Paper presented at IFA Technical Symposium, Vilnius, April 2006.)

One cause of such reactions is the impurities that may be present in the potash. These can act as crystal modifiers. The processing of the potash ores may also affect the performance of the product when mixed with other materials. Froth flotation of KCl from sylvinite ores (as practised with 80% of the potash produced in North America and 50% of the KCl produced in Europe and the FSU) involves agitating the de-slimed ore with a clay depressant or slime binder to deactivate clay particles that are entrained in the washing ore. Suitable depressants include starches, guar gum, carboxymethyl cellulose and polycrylamides. Typical dosage rates may be between 50-500 g of depressant per tonne of ore being processed.

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Perspectives from the top

Summary

Fertilizer International recently visited the Prayon head office and plant in Engis and had the opportunity to meet senior Group executives. Here, Jean-Nicolas Braham (Deputy CEO), Marc Collin (General Manager of Prayon Technologies) and Serge Kurowski (Vice President of Profile Division) assess Prayon's competitive strengths and the future outlook for phosphate technology.

Abstract

Prayon s.a. was founded in 1982 but the group can trace its origins back more than 100 years to the Liège region of Belgium. Benefiting from an abundance of mineral resources, this region has for long been Belgium’s industrial powerhouse and a centre for chemical production. Prayon became established as a major producer of phosphate chemicals for use in detergents, industrial applications such as water treatment or metal surface treatment, and as food additives, and developing inorganic chemical specialities, justifying the Prayon Group’s slogan of providing “Products to meet everyday needs.”

There have been many changes in European regional markets for these products, but Prayon has been able to establish world leadership in the phosphate chemical sector, which it has reinforced through its unrivalled expertise in phosphoric acid production technology. Prayon has licensed this for use around the world, and today, around 50% of phosphoric acid production sites use Prayon technology and 70% use Prayon equipment.

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Latin American revival – and how

Summary

With Brazil leading the way, the Latin American regional agricultural sector appears to have revived and the prospects for fertilizer sales in 2007 are excellent. This in turn promises a bonanza for the leading overseas suppliers.

Abstract

Maintaining the trend of the past few years, the global economy remains very strong into the second half of 2007, and according to the International Monetary Fund (IMF), the world GDP is expected to grow by 4.9% in 2007 and by a similar percentage in 2008. Within Latin America, Brazil continues to set the pace in economic growth, and after a relatively sluggish GDP growth of 2.9% in 2006, the pace has accelerated, with a 3.7% growth in the Brazilian economy being posted in 2006, a forecast growth of 4.4% this year and a no less impressive 4.2% growth rate forecast for 2008. The revival in Brazilian agriculture has been a key factor in this resumption in rapid economic growth.

One driver in the renewed vigour displayed by Brazilian agriculture has been the drive to produce increased volumes in bioethanol, with sugar cane as the primary feedstock. Brazil is setting the pace for the rest of the world, and approximately 18% of the country’s transport fuel requirements are already met by biofuels. This by far is the largest such percentage share and it will rise further as 80% of new cars in Brazil are now adapted for flexi-fuel systems. (Medium-Term Outlook for World Agriculture and Fertilizer Demand 2006/07-2011/12, Patrick Heffer, IFA, May 2007.)

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