Cherkasy-based Azot, part of Ostchem’s nitrogen holding company, produced 235,000 tons of mineral fertilizers in January-February 2023, up 23% from January-February last year, Group DF press service said Wednesday.
“Production in February 2023 was 123,700 tons of products per month, the highest since the start of the all-out war,” the release specified.
According to it, urea was the key product, due to which the company showed an increase in production volumes in January-February 2023. Its production for two months increased almost three times – up to 67.4 thousand tons.
UAN production also increased by more than 10%, from 50.9 thousand tons to 56.2 thousand tons, while the volume of ammonium nitrate production slightly decreased – by 2%, to 102.2 thousand tons.
“This year, because of military risks, farmers delayed until the last moment the decision to buy mineral fertilizers, there was a significant deferred demand. As a result, in January-February demand for our products increased significantly. It is logical that the company increased its capacity utilization to 70-75%,” Vitaliy Sklyarov, Cherkasy Azot’s chief executive officer, said in a statement.
According to him the enterprise is not reducing loading in March because the agrarians continue to actively buy fertilizers and many have not formed the stocks enough for the spring sowing campaign.
Sklyarov stressed that in March and April the company will continue to work at 70-80% of its capacity, “as long as there will be a high demand from the side of farmers”. He specified that today all basic fertilizer production facilities of ammonia, ammoniac acid, ammonium nitrate, urea and UAN are operating at the plant.
“The catalyst for the sharp increase in demand in 2023 was a decrease in selling prices for mineral fertilizers during the ‘hot’ season, which was possible due to lower prices for gas, the main raw material for the production of fertilizers,” also noted the head of the board.
According to him, the growth of demand is limited by the financial capabilities of fertilizer consumers: on the one hand, the support of farmers by the state has a significant effect, but on the other hand, access to finance for small and medium agrarians is still very limited.
It is reported that since the beginning of 2023 Nitrogen Holding Ostchem reduced the cost of urea by 9 thousand UAH – to 29 thousand UAH/ton, ammonium nitrate – by 8.5 thousand UAH, to 28.5 thousand UAH/ton, UAN – by 4 thousand UAH, to 29 thousand UAH/ton.
Ostchem enterprises produced 1.75 million tons of mineral fertilizers in 2022, of which Cherkassy Azot produced 1.117 million tons.
