Ostchem’s nitrogen holding plants produced 515.5 thousand tons of mineral fertilizers in the first quarter of 2023, up 36.2% year-on-year, Group DF said in a statement on Friday.
According to it, Cherkasy Azot produced 387.4 thousand tons and Rivneazot produced 128 thousand tons, while Azot produced 137.8 thousand tons in March, the maximum since the beginning of the full-scale war.
“Lower gas prices have reduced the selling prices of mineral fertilizers. As fertilizers became more affordable, we started selling more and showed very good results. This spring, the high utilization of enterprises lasts longer than usual,” a comment by Oleg Arestarhov, head of Group DF’s corporate communications department, is quoted in the report.
It is pointed out that the key products produced by Ostchem plants were urea, UAN (Urea Ammonium Nitrate Network), ammonium nitrate, and lime ammonium nitrate (LAN). Urea output in the first quarter increased 4.7 times, to 106,500 tonnes, and UAN output 2.1 times, to 108,500 tonnes.
Production of ammonium nitrate increased from 217.1 thousand tons to 255.4 thousand tons, while UAN production fell from 62.3 thousand tons to 10.6 thousand tons.
“The structure of production corresponds to the structure of demand. The further demand will determine the production load of the plants, the terms of the repair campaign,” Arestarhov pointed out.
Among the new market trends the company highlighted the active supply of fertilizers in the de-occupied territories (Kherson, Nikolaev, Chernigov and Sumy regions). And among the factors constraining the growth of the fertilizer market, it noted an increase of marketing and logistics risks of agribusiness, such as the uncertainty of the prospects for a grain agreement, and restrictions on imports of Ukrainian grain, introduced in April 2023 by some EU countries.
As reported in early February, Group DF’s nitrogen holding Ostchem reported on the planned increase of its capacity utilization for the production of mineral fertilizers at Cherkasy Azot from 30% to 70%, and Rivneazot – up to 50% due to the seasonal increase in demand
Group DF earlier estimated the volume of consumption of ammonium nitrate by the Ukrainian market in 2022 at 1 million tons (import – 330 thousand tons); urea – 410 thousand tons (import – 225 thousand tons); UAN – 580 thousand tons (import – 190 thousand tons), stating that the expected increase in fertilizer consumption in 2023 by 15-20%.
