So are we building it?

[vvalk]

I think it takes 20GJ to make a tonne of
urea. Could be wrong though

[Hopperbin]

A news article,

A Quebec farmers’ co-operative is launching a joint venture with a leading Indian counterpart to build a $1.2-billion nitrogen fertilizer plant in Bécancour, a community reeling over the decision by the PQ government to close the province’s only nuclear power plant.

The Quebec-based Coop fédérée and the Indian Farmers Fertiliser Cooperative (IFFCO) signed an agreement of intent on Tuesday as part of the first phase of a project that could create between 200 and 300 permanent local jobs.
The Quebec government, through its venture capital arm Investissement Québec, is injecting $5-million to help finance the initial $20-million feasibility study. The province will also help finance the public hearings process and environmental assessment studies that should be completed by 2014. Construction is expected to begin that year, with a projected production start set for 2017.

U.S. Awasthi, managing director and CEO for IFFCO, said that after examining 50 potential sites, Bécancour was chosen because of the accessibility of natural gas needed in the production of urea, the essential product used in nitrogen fertilizer. He added that Bécancour, located in central Quebec’s agricultural heartland, also provides the proximity of a port on the St. Lawrence River. And it offers access to railway and major road transportation networks to facilitate distribution of the fertilizer in Quebec, eastern Canada and the northeastern United States.

“We expect to make profits but we don’t expect to make huge profits,” Mr. Awasthi said, emphasizing the co-operative values shared with its Quebec counterpart. “Canada is a good choice because Canada has an abundance of resources and fertilizer [production] needs energy.”

He added that the Quebec government’s decision to shelve the development of shale gas was not an impediment on the co-operative’s decision. He insisted that current supplies through Gaz Métro Inc. could meet fertilizer production demands for the proposed project.

The plant, the first of its kind in the province, will have the capacity to fulfill Quebec’s annual demand of 500,000 tons of urea per year. Manish Gupta, IFFCO’s director of strategy and joint ventures, said growing demand for urea worldwide eventually may lead to the construction of a second plant, either in Bécancour or elsewhere in Canada.

“This is the first large scale plant in Quebec,” Mr. Gupta said. “Because of the way natural gas is moved on the continent, there is a lot of interest in setting up urea facilities in North America. We believe we are the first to hit the road but there are many people trying all over the continent. It is our intention in the future to expand as it is our intention to expand all over the world. But we are taking it one step at a time.”

[wd9]

We need to come up with a better way of
taking atmospheric N and putting it in the
ground. Instead of building a plant, we
should pay for research and won the
technology.

[Hopperbin]

As global demand for nitrogen fertilizer has increased, the U.S. has become one of the world's largest importers of this important commodity. This has resulted in America's farmers and food supply becoming more dependent on foreign sources of essential fertilizer products. According to data from the Economic Research Service of the United States Department of Agriculture (USDA), 54 percent of the U.S. nitrogen supply – or approximately 10.79 million tons – was imported in 2011.

Read more here: http://www.heraldonline.com/2012/09/26/4294103/air-permit-filed-for-billion-dollar.html#storylink=cpy

[countryguy]

Not at cost Walk. I said WHOLESALE. The same price that they would sell to other retailers. If they sold for less that's when they would get squished like a bug.

[westsider]

There are some very good thoughts and points on this thread, especially the comment on research into product use efficiency. However, if i was a big fert company i would pay big $ to keep a lid on any great idea that came along that could cause demand for my product to go down.

If you are like me you are thinking everyday about your net return and part of that equation is cost. however, some ideas get eliminated right away - this is one of them.

I hope FNA succeeds. i hope i can buy cheap fertilzer from them, and support you and all that invested in this. I hope that FNA sells fertilizer for cost just like they do their glyph ...oh wait...

Country guy, if you are real serious about getting a return on the fert that you buy to grow your business, go invest in one of the publicly traded large companies already in the game! Think about it!

[dave4441]

Wholesale cost? Ag retailers make 10-20 dollars per MT. Unless they take a position on the fert as it is rises, that is about all the margin we are talking about (which can also add it up to massive losses as we seen a couple years ago). What is the per MT cost to service the debt on a 1 billion dollar plant.

[LWeber]

http://www.marketwire.com/press-release/viterra-achieves-strong-third-quarter-results-tsx-vt-1698105.htm


Viterra is increasing its fertilizer margin guidance to $140 to $160 per tonne for fiscal 2012 from its previous guidance range of $120 to $140 per tonne.

[HappyFarmer]

Maybe taking the right position viterra can make
that but Dave is right, normally 10 to 20 bucks is
all retailer makes. Something sounds fishy to
about those number from viterra but whatever.