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.
Cherkasy Azot, part of Dmytro Firtash’s Group DF nitrogen business and primarily engaged in production of chemical fertilizers, has launched a project to launch the production of AdBlue, a special additive for diesel engines used to reduce NO (nitrogen oxide) emissions.
“We are entering a growing, marginal, but very competitive market. Completion of all preparatory work for the launch of the project is expected in the first half of 2022,” the company’s CEO, Vitaliy Skliarov, said in a release.
According to the report, the expected production volume of the reagent is 10,000 tonnes per year.
At the moment, Azot has carried out preparatory work for the installation of equipment. The production of the reagent will be organized on the basis of workshop K-4, where crystalline caprolactam was previously produced.
The volume of investments will be announced after the launch of the project and will include all the necessary certification procedures.
Skliarov added that negotiations are underway with the German Association of the Automotive Industry (VDA), which developed this technology, to conduct an audit and issue a license to use the AdBlue brand. According to him, the sale of these products is planned both in the domestic and foreign markets, it is possible to increase the capacity.
According to Group DF estimates, the volume of the market for AdBlue and its analogues in Ukraine is about 35,000-45,000 tonnes per year, while today more than 60% of the Ukrainian market is occupied by imports, and Cherkasy Azot will be able to gradually replace imported products.
“AdBlue is, in fact, an aqueous solution of urea, respectively, its largest producers worldwide are nitrogen plants. It is logical that in Ukraine we will have a price advantage over competitors … We will also have a price advantage in the European market,” Skliarov said.
PrJSC Azot (Cherkasy), part of Group DF of businessman Dmytro Firtash, has launched a 45-day project to modernize the M-6 urea plant, capital investments in which will exceed UAH 165 million, Group DF said.
“The modernization of the M-6 urea production plant will be the largest project for the plant in the last 10 years. The enterprise makes money, the shareholder continues to make capital investments and modernize key industrial sites,” head of the board Vitaliy Skliarov is quoted as saying in a press release.
According to him, the work is aimed at increasing the capacity of the workshop and achieving energy savings.
According to the release, the exact figures for the new capacity of the workshop, which is now 1,000 tonnes per day, will be made public after the implementation of the project and the restoration of the workshop. Group DF Director for Communications Oleh Arestarkhov told Interfax-Ukraine that it is about increasing capacity by about 10%.
It is also assumed that the modernization will improve the efficiency of chemical processes in the shop, improve the reliability and stability of most production processes and have a positive effect on the technical and economic indicators of the shop as a whole.
In particular, it is planned to replace the high-pressure condenser and install a new low-pressure condenser, which has almost twice the working surface, as well as replace the old mass transfer plates in the synthesis reactor with new ones, made by the Swiss Urea Casale, with an increase in their number from 10 to 11.
PJSC Azot (Cherkasy), a member of Dmytro Firtash’s Group DF, produced 1.29 million tonnes of nitrogen fertilizers in January-September this year, which is 10.4% more than in the same period in 2019.
According to the Group DF press release, in particular, 347,100 tonnes of commercial ammonium nitrate were produced; commercial urea totaled 439,900 tonnes, urea-ammonium nitrate (UAN) was 493,000 tonnes, and ammonia water totaled 11,000 tonnes.
“The indicators for the nine months of 2020 exceeded the same period of 2019 by 10.4%. In particular, ammonium nitrate production increased by 8.1%, UAN production increased by 26.1%. Total urea production increased by 4.4%, but not all urea was sold. Part of it was used for the production of UAN, for which demand is increasing. Thus, the company responds to market conditions,” the press service of Group DF quotes the words of chairman of the board of the company Vitaliy Skliarov.
The company has also expanded its product range of mineral fertilizers. The plant produces four types of urea-ammonia nitrate: UAN- 32, UAN- 30, UAN – 28, UAN – S (in 2019 it produced only one type UAN-32).
Today Cherkassy Azot is operating at 100% capacity load. According to Vitaliy Skliarov, the company intends to work at this pace in the future, providing the autumn sowing campaign.
Cherkasy Azot is one of the largest Ukrainian chemical enterprises. It is engaged in the production of mineral nitrogen fertilizers. Since 2011 it has been a member of Ostchem Group (the nitrogen business enterprises of Group DF).
PJSC Azot (Cherkasy), part of Dmytro Firtash’s Group DF, produced 1.42 million tonnes of nitrogen fertilizers in January-November 2019, which is 9.2% more than for the whole of 2018, Group DF’s press service has said.
According to a press release, production of ammonium nitrate for the reporting period amounted to 417,500 tonnes, carbamide some 557,200 tonnes, carbamide-ammonia mixture some 438,100 tonnes. At the same time, production of ammonia was 55,700 tonnes, non-concentrated nitric acid some 507,200 tonnes, and ammonia water some 9,200 tonnes.
“In 2019, we achieved almost 100% loading of our production capacities. The growth in production volumes by the end of the year will be about 10% … For the 11 months of this year, we increased production of carbamide-ammonia mixture by 81% compared to the corresponding period last year (from 240,900 tonnes to 438,100 tonnes). Carbamide production increased by 55%. Nitrate production also increased, but only slightly,” Group DF’s press service said citing Vitaliy Skliarov, the chairman of the company’s board.
Among the main growth factors, the company indicates the antidumping measures of the Interdepartmental Commission on International Trade regarding the supply of fertilizers from the Russian Federation.
