WSF New AG International e-book October 2021
When preparing this e-book, I recalled the words of my predecessor, the inimitable Jean-Pierre Leymonie in his opening remarks to the 2010 New AG...
<b>Water-soluble fertilizers –
where quality matters
New AG International e-book series
<a href="https://adob.com.pl/en/">ADOB</a> & <a href="https://www.tessenderlokerley.com/en">Tessenderlo Kerley International</a>
New AG International
proud to release an
e-book in one of its founding topics – water-soluble fertilizers.
As the global population grows and demand for fruit and vegetables increases, so too does the importance of water-soluble fertilizer to growers. And an important trait of water-soluble fertilizers is their lack of substitutability. Sri Lanka has found this out recently*.
One of the core messages from this e-book is the quality level that needs to be obtained when producing water-soluble fertilizers. For example, too many impurities can lead to blocking of filters and drippers.
Quality is also important when dealing with foliar fertilizers and chelating agents. One of our sponsors ADOB provides an insight into how the WSF market has changed in recent years. When it comes to the formulation choice, liquid or solid, ADOB tends to define its approach based on biological efficacy and best economical option for the farmer.
Regarding new developments in agriculture, ADOB says vertical and urban farming are areas of application for its products. This highlights another important characteristic of WSFs – the ability to fine-tune the composition. And as we learn from Chinese producer Fondin, WSFs can be mixed with amino acid, seaweed extract or humic acid.
To add a timeliness to this e-book, new sulphate of potash (SOP) production capacity in Australia is starting to come on-stream. Kalium Lakes’ SOP project at Beyondie, Western Australia, has produced its first batch of finished product during the commissioning process.
However, when using SOP for water-soluble applications the quality aspect is vital. We learn from another sponsor Tessenderlo Kerley International that although some water-soluble fertilizers are traded like commodities, you cannot assume all SOP products are the same quality and making your purchases based on price can be a risky strategy.
Tessenderlo Kerley shares the metrics it uses to assess its own water-soluble SOP, produced by the Mannheim process. One of the main reasons for introducing its SoluPotasse product to the market was to give growers looking for a chloride-free source of potassium an alternative to water-soluble potassium nitrate. Again, highlighting that WSFs are not always easy
Elsewhere, we get an overview of the Brazilian market for specialty fertilizers. One stand-out number reported by New AG International’s contributor Leonardo Gottems is that foliar fertilizers represent around 70% of total specialty fertilizer revenue.
In an interview with Veolia, we dive into the requirements for making water-soluble monoammonium phosphate (MAP). The quality of the feedstock often dictates the quality of the end-product. When making water-soluble MAP, also known as high-grade or technical MAP, the quality of the phosphoric acid is key. However, Veolia’s crystallisation technology allows low-grade phosphoric acid to be used in the production of high-grade MAP.
And in a combined special, we also present market analysis looking at what can be learned from the trade patterns for some of the most widely consumed water-soluble fertilizers: calcium nitrate (CN), potassium nitrate (PN) and monopotassium phosphates (MKP) markets.
To follow up on themes presented in this e-book, New AG International is pleased to announce its New AG Annual conference and exhibition will be running as a ‘live’ event in Poland in March 2022, with a conference programme focused on specialty fertilizers and hi-tech plant nutrition. For information on speaking opportunities and sponsorship, contact our Portfolio Director, Naomi Brooker.
From the team here at New AG International, we hope you enjoy this e-book. ●
New AG International
ADOB - an interview with Adam Nawrocki - company founder
Since 1990, ADOB
has grown into a world leading supplier of water-soluble fertilizers and chelated trace elements. New AG International
Editor-in-Chief Luke Hutson put the questions to Adam Nawrocki, who founded the company,
to learn about the company’s trajectory
and why in some cases
it is the only producer
in the world of a particular product.
Founder of ADOB
Over the last 30 years, I'm sure there have been a lot of highlights. But what would you say were the strategically critical moments in the company's history, the ones that really put the company on its successful trajectory?
One of the most important points in our strategy was the decision to rely on our own R&D team which enabled us to develop many products and technological processes. Consequently, in case of certain products, we are the only producer worldwide.
Having 13 PhD team members who completed their theses devoted to our products and processes and following our motto “power of science” has put us in the leading position in the speciality fertilizer sector with special focus on chelated micronutrients.
Firstly, let's talk a little about the business side of things:
Is co-operation with multinationals still central to ADOB's strategy?
Yes, the cooperation with multinational companies is our main channel to distribute ADOB’s range of products, however there are also direct business relations with many local distributors from 82 countries where our products can be found these days.
In terms of distribution, is ADOB still a shareholder in Van Iperen? Would Van Iperen be your main distributor for European markets? And for global markets, does ADOB do its own distribution? Who do you work with in China, for example?
Van Iperen International, where
I am still a shareholder, is an important partner of ours, but depending on products and markets their position varies.
Concerning the Chinese market, we have a few channels including multinationals and a joint venture ADOB Qingdao where I am a shareholder too.
Now moving to technology and products. ADOB and Bayer broke new ground with IDHA chelating agent back in 2002. As we arrive to nearly two decades of this agent being on the market, how has the agent and its applications evolved?
Talking about IDHA chelate, we were the first together with Bayer who came to the market with biodegradable chelates that are produced chemically. Until 2019 it was the only chelating agent registered in the EU 2003/2003 directive enjoying such status.
The IDHA chelates develop well in many countries and we believe if only regulations put more pressure on the chelating agents as they do in many industrial sectors, we will be at the right time with the right product.
And to follow-on from the previous question, what is the future of chelating agents? And just to expand a little: IDHA, EDTA, DTPA, HBED - they all have a place, but do you see one or two agents stepping ahead in certain applications?
Actually, all of them have their own position in the market, mainly related to agronomical conditions that the farmer works in:
The groups are the following:
a) Foliar application – IDHA, EDTA are the best performing products
b) Soil application
- at pH < 6.5 IDHA, EDTA are still a good option in terms of efficacy
- at pH 6.5 – 7.5 DTPA chelates are the best option
- at pH > 7.5 HBED or EDDHA are the only options available
Just a quick word on non-agricultural applications. I'm aware these would be the smaller part of your revenue. What applications do your products serve? Do you see any growth in non-agriculture markets?
Non-agricultural markets are
really very small, but there is a
body of research carried out
where chelated micronutrients
might be applicable: water treatment, oil drilling, feeds, etc.
Water-soluble fertilizers - what changes have you seen in the market over the last two decades?
Concerning the changes in the market on liquid / solid products,
the first point is the destination of our products.
Within Europe the transport of liquids is still accepted due to relatively low costs. On the contrary, overseas destinations prefer solid products.
Indeed, there are many markets where liquids are preferable, like the US, but it is due to the presence of many local producers who offer liquids and farmers prefer this option rather than spend time on dissolving solids.
ADOB’s approach to this is issue is firstly biological efficacy and best economical option for farmers.
Vertical and urban farming - and the use of hydroponics - do you see specific water-soluble formulations being developed for this growing sector?
Vertical and urban farming as well as hydroponics are definitely areas of application for our products, because one can fine-tune the composition of products and control it very precisely.
Apart from this point, our range of products based on potassium salts and anion free versions is an ideal offer as all ingredients are available to plants without accumulation of sodium in the solution.
Nanotechnology can be a buzz word, but is that something you’ve been able to incorporate into your products so far?
For us it is even more than a buzz word because so far, despite many tests done with many products, we were not successful to implement these into our portfolio.
Considering foliar application, there are no better conditions for plants to take-up nutrients than in ionic form which is well documented and fertigation application is even worse example for nanoproducts.
So, taking into consideration the cost of production real nanoproducts (below 100nm) and safety issues to handle the product, there are not so many reasons to apply them in agriculture.
Dealing with EU registration - from a previous interview I have some idea of your thoughts and experience in this topic! But bringing this to the present, what are your hopes and concerns for the new Fertilising Products regulation?
Due to the fact that I was involved in the process of new Fertilizing Products regulation from 2014 it seems to me there would be nice topic to write a poem about it or to have a separate interview related to this point alone.
To be short, new regulation enables to channel all possible waste products from many industries into fertilizer products and I believe after 5-10 years we will see the consequences.
And looking to the future - what's the next step for ADOB? Does the company remain independent? If not, what does a suitable partner look like?
It is a good question causing many sleepless nights. But at the time being we are fully independent with so many ideas, projects to be done that there is no time to think about this question. ●
The main office of ADOB is located in Poznan, Poland, but production sites operate in Poznan and in Wrocław. The company employs about 420 people, of which 220 in Poznan and 200 in Wroclaw. One of the specifics of the small company ADOB is that it has been successfully cooperating with multinational companies like BASF, Bayer, SQM, Yara, and ICL. ADOB has set up in representative offices in offices in Brazil, Ecuador, Israel and Peru. ADOB`s share capital investments are located in China, Netherlands and Belarus. The distribution platform launched together with Netherlands-based Van Iperen International in 2010 is also giving the company good opportunities to develop new markets. ADOB offers fertilizers in liquid form as well as in solid form of dust-free microgranules. Fertilizers offered by the company represent a somewhat unique technological combination of high efficiency and superior quality raw materials used for production. The company holds a leading position in many of the segments where it operates, ADOB developed full programmes of foliar and soil fertilization for agricultural and horticultural crops and for hydroponics as well. Fertilizers manufactured by ADOB are single compound products as well as multi-compound ones and are widely used to fight acute micronutrient deficiencies and to protect the plants against effects of abiotic stress conditions (e.g. drought, frost or unfavorable pH). ●
Tessenderlo Kerley International
The importance of quality for water soluble SOP
The Importance of quality for soluble SOP
Choosing a soluble potassium sulphate (SOP) solely on price can be a risky strategy, particularly if the product is going to be run through a drip irrigation system. Here New AG International
and Tessenderlo Kerley International discuss
the benefits of using, or opting for, a high-grade soluble SOP product.
Given that some water-soluble fertilizers (WSF) are traded like commodities, it would be an easy mistake to assume that all SOP products are the same. However, given the variation in production processes, the quality of end product can vary dramatically, and this is an important consideration for end-users, particularly those running the product through a drip irrigation system.
Practical evaluation of insolubles
So how can you start to distinguish between the products?
When given a sample of product there is an easy test to check the level of insoluble material and the speed of dissolution.
The presence of insolubles is highly undesirable and can lead to clogging of both the filters and the drippers. Such clogging can have economic, in the sense of time consuming and costly cleaning operations, as well as agronomic consequences.
An acceptable level of insoluble is generally considered to be 0.05% or less. SoluPotasse, the class leading water-soluble SOP produced by Tessenderlo Kerley, has an average score of 0.02%, according to the company’s data from 2020.
In the company’s monitoring of other water-soluble SOP products available in the market, almost 50% of analysed samples were above the 0.05% limit and 12% were even above 1%.
SoluPotasse (left) dissolves rapidly and completely unlike poor quality soluble SOP (right)
Photo: Tessenderlo Kerley
Concentration of crop nutrients
The concentration of nutrients in a product directly benefits the grower since it means there are more nutrients per kilogram of product, which ultimately means the grower needs to handle fewer tonnes, saving time and logistics.
In SOP, growers are of course looking for high concentrations of K2O and SO4. There is also variability in the market among soluble SOP products, according to Tessenderlo.
The company says that it has identified many examples where the level of K20 is less than 51%. SoluPotasse samples achieved a score in 2020 on average of 51.6% and never lower than 51.5%.
Chloride and Sodium content
One of the agronomic benefits that growers are seeking when choosing SOP is low chloride content for crops that are chloride intolerant and also in conditions where the use of chloride containing fertilizers may contribute to salinity problems.
And it is often the high-value
cash crops are chloride intolerant. But in order to get the best crop quality, growers need to be extra careful about the chloride content
of the WSF.
The chloride (Cl-) content of products can also vary, like the solubility. In research conducted by Tessenderlo Kerley, only around half the samples taken from the market and analysed had a chloride content below 0.6%.
There were even some samples (almost one quarter of those analysed) with chloride content above 1%, a level considered by many as too high for a water-soluble form of SOP. SoluPotasse averaged 0.35% in 2020 and never scored above 0.5%, according to the company.
The sodium (Na+) level, also a good indicator of purity, typically varies between 0-2% for products found in the market. For SoluPotasse, the sodium level in 2018 never exceeded 0.4% with an average of 0.35%.
A higher content of chloride or sodium will lead to a difference in performance.
pH of the solution
An acidic solution can be positive since it will help prevent the build-up of deposits in the irrigation system. This can help to minimize costly maintenance downtime.
The acidic solution will also regulate the pH level in the rhizosphere. This can help to optimize the uptake of the full range of plant nutrients. Different nutrients have different pH windows for their optimum uptake.
The speed at which the product dissolves in water is a key metric for the usability of a product. From a practical point of view, a faster dissolution speed saves the grower time and money.
In the company’s research, Tessenderlo Kerley found that some forms of SOP claiming to be soluble did not dissolve to more than 90%, even after 10 minutes of stirring. Tessenderlo Kerley’s definition for a quality product is one that is 90% dissolved after 3 minutes of stirring.
An important parameter when it comes to application rates is maximum solubility.
The quantity of SOP that can be dissolved in a certain volume of water is important to the grower. The higher the quantity the higher the concentration. If a grower is looking to conserve water, they might want a higher concentration.
Tessenderlo Kerley has found a range of maximum solubilities. A product such as SoluPotasse has a maximum solubility of 12 kg/100 l in pure water at room temperature, while some other products barely reach 11 kg /100 l.
It should be noted that maximum solubility can also be impacted by water quality and temperature.
Dust content of a product is an important factor. Not only does high dust content make the product unpleasant to handle, it can make dosing imprecise. Ideally the maximum dust level, according to Tessenderlo Kerley, is 0.2%. SoluPotasse has been independently verified as typically containing only 0.05% dust.
Quantitative scoring system
Being able to score a product, thus picking out the best from the worst, is vital to an efficient operation. Selecting the most important quality parameters also increases efficiency and allows products to be easily and speedily compared. In this way a quality index (QI) can be developed.
In order to develop their quality index for water-soluble SOP products, Tessenderlo Kerley conducted workshops and surveys with distributors and growers from across the globe. Eight quality parameters were identified as being the most essential, and agreement
was reached on the order of importance. The parameters are listed in the Table 1, showing the top 8 shared between the most important chemical and physical parameters.
Table 1: Quality Index parameters for SOP in order of priority
(Source: Tessenderlo Kerley)
Modern drip irrigation equipment requires a top quality WSF in order to perform optimally. Lower quality SOP will give problems, particularly where water quality is poorer. Some SOP products are difficult to dissolve and as mentioned above contain higher levels of insolubles. This increases the risk of blockages to the filters and drippers, and will ultimately have an agronomic impact in that there is an inefficient uptake of nutrient by the plant.
There is always a trade-off to be made between the price of a bag of product and its quality and efficiency. Given the investment in drip irrigation equipment, opting for a lower quality product might pay in the short-term but could lead to problems in the longer term.
Different production routes account partly for the variability in product quality. There are three principal methods for SOP production.
The evaporation process is where surface or subsurface brines undergo an evaporation and crystallisation process. SOP products tend to be pH neutral, which, according to Tessenderlo Kerley is not ideal as a soluble grade. See earlier reference to where acidity is an important characteristic for fertigation.
A second route is the ion exchange process based on a mined ore known as Hartsalz, which contains potassium chloride (KCl) and magnesium sulphate (MgSO4). An ion exchange reaction occurs to give potassium sulphate (K2SO4) and magnesium chloride(MgCl2)
A third route is the Mannheim process which is conducted at a high temperature. In this process potash (potassium chloride) reacts with sulphuric acid in a furnace to produce SOP. The by-product hydrochloric acid is used in other processes and industries. Products have slightly acidic pH, which is better for soluble grade according to Tessenderlo Kerley.
It should be noted that the Mannheim process is not a guarantee of a high quality, according to Tessenderlo Kerley. “The best forms of water-soluble SOP can be found where there is a long tradition of Mannheim production.”
Since soluble SOP is used in over 100 countries worldwide, with different cropping seasons, it is important that product is available throughout the year. ●
We are the only supplier combining both a consistently high quality and the capacity to secure worldwide demand,” says Tessenderlo Kerley.
Tessenderlo Kerley International:
the world’s leading producer of high-grade SOP
Tessenderlo Kerley International was the first company to produce a true water-soluble form of soluble SOP, commercialized as SoluPotasse®, back in the 1990s. One of the main reasons for introducing the product at the time was to give growers looking for a chloride free source of potassium an alternative to water soluble potassium nitrate.
Crops of course need both nitrogen and potassium but the amounts required vary during the plant’s growth cycle. Nitrogen is important early on for crop development but later in the season potassium becomes the most important nutrient, and the need for nitrogen decreases. Getting the N/K ratio right is extremely important for optimal results – and providing the crop with enough potassium when it is needed most will help ensure optimal yield and quality. Excessive use of nitrate-based fertilizers late on in the season can often lead to softer, lower quality fruits and vegetables that are less resistant to storage and transport. SoluPotasse is therefore the ideal chloride-free potassium source to use when the crop requires less or no nitrogen or in cases where the crop receives sufficient nitrogen from other products (for example calcium nitrate).
Tessenderlo Kerley International is proud to be the world’s leading producer of high-grade water-soluble SOP and SoluPotasse today is sold in over 90 countries throughout the world. Product quality is one thing but not all producers deliver products of a consistently high quality. There can be variation in quality between batches or deliveries. This is not the case for SoluPotasse, which thanks to rigorous quality control, is always of a consistently high quality. Reliability of supply is also of paramount importance since agriculture is a seasonal business – distributors and growers want to be sure they can get soluble SOP when they need it and in sufficient quantities. Tessenderlo Kerely is the world’s biggest SOP producer using the Mannheim process and this helps ensure that the company can maintain a reliable supply of SoluPotasse throughout the season even when demand peaks. This
is not always the case with
It is also worth mentioning that Tessenderlo Kerley has a dedicated team of agronomists working in key markets across the globe to support customers who use its SOP products, including SoluPotasse, as well as the company’s unique range of thiosulfate based liquid fertilizers. The agronomy team provide advice and support and conduct trials to demonstrate the benefits of Tessenderlo Kerley’s products and help growers get the best results from them.
To enable Tessenderlo Kerley to grow and remain the leader in this premium water-soluble potassium sulphate market, the company announced at the end of 2020 that it had signed a long-term off-take agreement with Finnish chemicals company Kemira for the marketing and distribution of premium SOP fertilizers.
The agreement is for the off-take and marketing of the premium water-soluble SOP produced by Kemira at its plant in Helsingborg, Sweden. Thanks to this contract, SOP customers around the world can now be even more sure of reliability of supply, access to highest quality product, and professional service and support. Both Kemira and Tessenderlo Kelrey share the same mindset towards continuous improvement and qualitative production.
The off-take agreement with Kemira effectively increases the amount of SOP that Tessenderlo Kerley can bring to market. In addition, being able to supply from two sites provides additional logistical flexibility for deliveries and enhanced output, particularly important in periods of high demand. Tessenderlo Kerley offers a complete SOP range: powder grade, granular grade and soluble grade as well as a special grade, K-Leaf®, for foliar applications. ●
Tobacco is a chloride-intolerant crop.
Fertigation using high quality water soluble fertilizers is widely practiced in Indian floriculture
Fertilizer stock solutions
are prepared in tanks before injection into the drip
Analysis of water-soluble fertilizer trade
Using trade data to better understand trends in potassium nitrate and calcium nitrate
In this article, which first appears in a series on the global trade in water-soluble fertilizers, we look at two workhorses of this dynamic fertilizer sector – potassium nitrate and calcium nitrate. Looking at trade data is one of the ways to see new trends in consumption – which regions and countries are importing more of a product. But care has to be taken with the numbers.
Luke Hutson explains.
This report will look at import and export numbers for 2019 for potassium nitrate (PN) and calcium nitrate (CN) available on the ITC portal. The aim is to give a general picture, provide some insight on the trade flows, and then highlight why caution is required with some of the numbers.
The report will also refer to a trade matrix for both PN and CN generated by New AG International (NAI). Trade matrices are a vital tool in providing a snapshot for a given year, showing how much each supplier shipped to each buyer or destination. A trade matrix provides the detail on aggregate export numbers, and this can lead to insights on which markets are growing.
Some general points need to be made about these particular fertilizers at the outset. PN and CN would usually come under the umbrella term “specialty fertilizers” and this would imply that their volumes are smaller than bulk commodity fertilizers. PN and CN tend to be shipped in bags, and very large amounts of CN are also shipped as solutions, and in dry bulk bags of PN and CN. These bags are shipped in containers, hence the image used on the front cover. They are high-value products and bagging also counters the problem of adulteration.
PN and CN are often used
on high-value cash crops,
such as kale
Trade figures are trying
to capture a snapshot
of something that is
For both fertilizers, production is dominated by only a few suppliers. We refer to this as concentrated supply, which reflects the supply of potash as well. As will become apparent, Chile/SQM dominates the production and export of PN; Norway/YARA the production and export of CN.
Having a concentrated supply does have benefits from an analytical view point. It can make it easier to deduce consumption figures – since many countries do not have any production of their own, the level of imports will also serve as an indication of the consumption minus any exports they make. And yes, even though a country has no production, it can still make exports, which means it re-exports some of its imports.
It is worth pointing out for those who have not worked with trade figures before that export and import numbers invariably will not match. This can be a shock to the uninitiated, particularly in this digital age - shouldn’t these numbers match perfectly?
The point that needs to be highlighted here is that any trade figures are trying to capture a snapshot of something that is inherently moving. Exports made in December might not arrive until January or February in the following year. So, exports for December could look higher than imports for December, for example. There can be other reasons – the product might be on a vessel making multiple discharges, such as three discharges at ports in three separate countries. Volumes to be discharged might change while the ship is in transit, or the final destination might change.
For these reasons, it is vital to make what is called a trade matrix, which we describe as “reconciled” trade data. This is where the exports that country A says it has exported to country B are equal to the imports that country B says it received from country A. Typically, you would backfill a historical series with reconciled data. That said, this doesn’t necessarily mean a trade matrix is the final word and testament on trade, more that this is the trade that can be accounted for from an exporter and importer perspective.
The next general point to be made is that trade doesn’t tell you much about consumption, and knowing consumption is really the main analytical objective.
In the simplest case, if a country has no production, then imports will normally equal consumption.
But the problem comes when you have a country that has its own production of a particular fertilizer that exports that fertilizer and also imports that fertilizer, and when it uses some of that fertilizer to make other fertilizers that it then exports. (Hopefully, you are still with me!) And that’s before you even start looking at stock levels. Trade provides one piece of the jigsaw.
New AG International has built production, import, export, consumption (PIEC) files for both PN and CN. The aim for this report is to bring out some highlights from the trade data, not to dissect the whole PIEC.
Once you start looking at PIEC you need to go further and separate capacity and production. Some plants will be running at full capacity, and there are economic limits here too. You are unlikely to run a plant below a certain percentage of its capacity before it becomes uneconomical. Of course, it depends on what type of plant you are talking about. Nitrogen plants would be run at high levels, >80 percent, but a potash or phosphate mine can be run at a lower level. For sulphur, largely a biproduct of the refining industry, you are talking about the refinery operating rates, so an indirect measure driven by demand for fuel, not even an agricultural commodity. The utilization rate of a plant or factory would again form part of a PIEC spreadsheet.
Actual production volumes are essential to know, rather than
... trade doesn’t tell you much about consumption, and knowing consumption is really the main analytical objective.
capacity numbers. In an ideal scenario, if you knew the actual production of every single producer, you could assume this equates to global consumption (putting aside the question of stock building). But there is no such perfect knowledge. You can make assumptions on how many days per year a plant will run, but what happens about that maintenance turnaround that was extended by a few weeks – what did that do to production?
But in essence, if we assume production and consumption should roughly be the same, then trade is what happens in the middle. This is where the product moves from geographical regions of surplus to regions of deficit.
In the ideal world that was mentioned above, it would be nice to have actual fertilizer consumption figures published by each country. Some do – for the main straight fertilizers. Some publish consumption figures at the nutrient level. Some go by delivery records, so it might still be sitting on the farm.
The work-around is apparent consumption, a derived number. If you go to a textbook, you’ll find the following formula:
For some countries, where they published consumption, it can even be used to derive an apparent production figure if necessary.
And then there is the problem mentioned above, where countries have no production but are reported as having made exports, often called re-exports. Often when looking
at trade data you will see that a country has some exports, but
you know it has no production.
One possible reason is when a destination is landlocked. South Africa often shows exports
for fertilizers that it doesn’t
produce, but it is the point of
entry for southern Africa.
A country being the point of shipment not origin is often seen in the Baltic ports. Often fertilizer is produced in Russia and then railed to a Baltic port and, for example, shipped from the port of Muuga in Estonia. Exports from Estonia are likely to be Russian, so this is another reason for having a trade matrix. You don’t really want to put down exports for Estonia when these aren’t really exports from Estonia. You really want to take them off Russian production to give a more reliable figure for Russia’s consumption.
When devising a PIEC, as a general rule of thumb, you don’t want your overall global consumption figure running above your global production number. It is possible there was a build-up in stock for a few years, and so consumption could be higher than production, but this is unlikely to persist long term.
The other problem with consumption is stock levels and time delays.
A country might report a jump in imports in one year – making analysts jump with excitement
that this was a growing market.
But that doesn’t mean it was necessarily all consumed in that
year, and it might have been
Apparent consumption =
production – exports + imports – change in stocks
re-exported if there was a commercial opportunity.
Raw material problem
With PN, there is also the problem that it is included in NPKs and exported in that form. This is the case with Haifa in Israel, where it exports PN and uses some for its NPK products which it also exports. If you only took the PN exports, this would give Israel a higher PN consumption than it really has.
This is another reason for constructing a trade matrix for each specific year to see detail of where exports are going, and then seeing what remains of an estimated production. In the case of Haifa, it is necessary to include PN into the NPK exports.
Exporter information – namely the list of countries that an exporting country says it exported to – can also shed light on the demand from that destination, particularly if that country does not report its PN imports. When constructing the PN trade matrix, exporters reported India as a destination for around 20,000 tonnes (t). There is no clearly published capacity for PN in India (though some may exist), so once some small volumes of exports are deducted, it implies consumption could be 18,000 to 20,000 t.
Other factors for both PN and CN is that not all production is for agricultural end use, and is destined for what is called industrial use, such as solar concentrated power storage for PN and explosives for CN (and PN). PN is used in glass making and as a food preservative.
And even with agriculture, the agricultural end use might only partly be nutritional – some could be to induce flowering, such as the usage of PN in the Philippines.
The industrial component needs to be broken out in the numbers, but this is never straightforward. Ultimately, it needs to be done on a country by country basis. At some point, you will be hoping to find a figure for that country for agricultural consumption, and then apportion the balance to industrial usage. In China, one published source for PN consumption put industrial usage as high as 50 percent.
Potassium nitrate (PN) (NOP, 13-0-46) is the main water-soluble straight fertilizer, and the primary ingredient in most water-soluble NPKs.
NOP is dominant in the world of water-soluble fertilizers (WSF), because in the same molecule it combines macronutrients nitrogen and potassium, consumed by plants at high rates.
The importance of PN as a WSF means, in general terms, the largest producers have also been the world leaders in the market for soluble fertilizer, including finished products.
There are two main producers in the world – SQM in Chile and Haifa in Israel. This is reflected in the export figures (see Table 1.). Indeed, such is the dominance of Chile, that it accounts for just under half of world exports and has done so for many years. That appears to be the case in 2019 when Chile’s PN exports were reported at 461,000 product t.
The producer in Jordan is Kemapco, and in China there are several producers of which Migao Corporation is probably the best known. Other lower production capacity is located in Spain, Belarus, Russia, and Ukraine.
Potassium nitrate salts are used as a thermal battery for concentrated solar power (CSP) storage. The Andalusian Spanish complex Andasol was Europe’s first parabolic concentrated solar power station, built in 2008.
Port of Rotterdam, Netherlands
From the NAI trade matrix for 2019 using ITC data, global trade for PN is estimated at 1,005,000 t, which would represent 32 percent of estimated production.
In many ways we would expect that percentage to be high because of the concentrated supply, and so product needs to move to areas of demand. If you compared this with ammonium nitrate trade as a percentage of production, it would be around 20 percent and for urea it would be 28 percent.
One reason it is not higher is the dominance of Chinese production and consumption. This reduces trade as percentage of production. If you were to remove Chinese production and exports, then trade as percentage of global production increases to 61 percent. At this stage we just need to be wary since this is not all for agricultural use. Our adjustment factor will be something like 70 percent for agriculture (discussed below). Only further analysis, country-by-country, will refine this number.
The following Table 1 shows the top 10 PN importers from ITC data for 2019. These top 10 countries account for around 74 percent of total imports for 2019. There are 80 countries reporting imports in the ITC data, which suggests many import small quantities. This would be expected for a specialty fertilizer, where cargoes can be a few hundred tonnes in shipping containers.
With this table, you basically have two tiers. Spain, Netherlands and the U.S. out in front, with Turkey some
Table 1 – PN importers Top Ten
way between the others. With the Netherlands, care always has to be taken with any trade statistics because of the Rotterdam effect – this is where exports from and imports to Rotterdam often get coded – incorrectly – as exports or imports for Netherlands.
Potassium nitrate exports are dominated by Chile. The domestic market is around 60,000 t (See New Ag International June 2020). The 2019 trade matrix shows exports of 460,975 t from Chile, followed by Israel, China and Jordan. There is a big drop to Spain.
Global apparent consumption according to the generated PIEC using ITC data is estimated at three million t (2.996 million t) for 2019.
Given the comments made at the start, consumption numbers often need to be derived in the form of apparent consumption. The data will be presented in later reports.
But just to highlight one country to show the steps necessary to disentangle the agricultural and industrial usage, Australia is a good example – it has a well-known mining sector and it has a growing greenhouse sector. The country has an estimated apparent consumption of 20,000-25,000 t PN, given imports from the trade matrix of 20,679 t. It is likely some of that would be used for explosives given the country’s mining industry. Using a calculation shown in references (Ref 1) based on data from ABARES, it appears that half of this PN volume is probably for agriculture and the remainder for industrial.
Table 2 – PN exporters Top Ten
Calcium nitrate (CN) (15.5-0-0+26.5CaO) has a high solubility and is the third most import ingredient in the soluble straights market after potassium nitrate and technical-grade MAP. CN is the most important source of calcium in fertigation.
This product can be described chemically in different ways depending on the hydration, which will in turn dictate its solubility. This has implications for the HS code, which is discussed below.
In previous New AG International articles, we have estimated some 60 percent of the world’s CN is applied by fertigation and foliar feeding, while the balance is applied by
Both the fertigation and foliar segments have been growing –
our last figure was >5 percent
per year – and there is an assumption this will continue,
mainly due to growing acreage of fruits and vegetables.
CN is not compatible with WSF phosphorus and sulphate raw materials, such as MAP, MKP, SOP, AS and Mg-sulphate, so very few
CN manufacturers also produce NPK products.
That said, a large majority of supply is produced by Yara – as its YaraLiva-Calcinit product. For Yara, CN is a byproduct in the production of phosphorus products.
Other producers include Fertiberia in Spain (at the site of former Portuguese ADP), the Czech producers Lovochemie, Polish producer Adipol and ADOB, and various Chinese companies.
In 2016, Russia’s Uralchem presented a tech-grade anhydrous product (CN (17-0-0+33 CaO).
Chemical formula and HS code
As can be seen from Uralchem product, it has a slightly higher N content then what might traditionally be called CN.
This raises the issue of how variations in chemical composition of CN reveal themselves in HS code, and as a result could lead to misalignments in trade data.
There are two points to this discussion – the chemical formula of CN and then the HS code.
Firstly, the chemical formula. The
CN salt may occur as three
hydrated salts, and an (anhydrate) anhydrous one.
The latter with 4H2O is known as tetrahydrate and represents stable solid phase at room temperature.
The tetrahydrate seems to be the standard reference, but one large producer gives its CN formula as Ca2(NO3)2*2.5 H2O.
An (anhydrate) anhydrous product would have the chemical formula Ca2(NO3)2.
When discussing this issue with Dr. Oded Achilea, NAI’s contributing editor, it would seem the ideal is to have as little crystallization water as possible, which means that product is higher in specific nutrient content, such as calcium in this case, which means the producer could command a higher price. But less crystallization means higher hygroscopicity which can lead to other problems.
One word of warning – sometimes a product can be called calcium nitrate but it is calcium ammonium nitrate when you look at its chemical formula under the product specifications. Ca2(NO3)2*NH4NO3*10H2O.
There is also a distinction between liquid and solid forms of CN. When talking to a fertilizer producer, they said anhydrous CN also had a lower N in NH4 form content than standard soluble grade. The level of NH4 is one reason why a grower might use a liquid form of CN which might be completely free of NH4.
There is also a distinction between liquid
and solid forms of CN
Now on to the HS codes, which is how you identify a product in international trade. For CN there are two codes: HS 283429 and HS 310260 –
• 310260 Double salts and mixtures of calcium nitrate and ammonium nitrate
• 283429 Nitrates excluding of potassium and of mercury
If you look up the HS code for a given CAS number – then the CAS number for CN tetrahydrate will return the HS code 283429. If you put in the CAS number for CAN you will get 310260, which is also 310240 (mixtures of AN with calcium carbonate). Therefore, 283429 has been used in the following data.
Just taking one example, if you use 310260 code you see China exporting 533,000 t in 2019 which is more than its 255,000 t CN capacity (albeit it's estimated capacity, so it might be higher). So, what else could be included in this 310260 code? The likelihood is this volume contains AN products. China does not export CAN.
CN provides a good example of the disparity that can exist when looking at total import numbers and then looking at a trade matrix. Global imports for 2019, according to ITC data, were 1.9 million t.
But the trade figure from the NAI trade matrix is 629,000 t in 2019, using the same ITC data. We’ll explain the discrepancy below, but essentially Norway does not report its exports, so only countries reporting imports from Norway are included, and in the trade matrix only 220,000 t could be found from Norway, yet production from Yara is more than one million t. Even adjusting for that will not get the trade matrix figure to 1.9 million t.
With CN, there are similar problems to PN, in separating out the technical and agricultural uses.
CN is also used in explosives and used in the construction industry to make concrete. Perhaps a lesser known application is its usage in the production of latex gloves. Given the Covid-19 pandemic, we might see more demand for CN for glove production, although this would not translate into a demand increase of large volumes.
Global CN imports were 1.9 million t in 2019 according to ITC data. Top importers are detailed in Table 3.
That is a close grouping for a top
10 of importers, compared to PN which dropped off quickly from the top three.
But we need to be mindful that not all imports are accounted for – this is the value of doing a trade matrix. As we’ll see in the next paragraphs, we need to take into account the Norway problem.
One of the key decisions is how to treat Norway exports. Norway doesn’t report exports of CN.
This is when we go back to the Yara financial reports and for 2019 see total CN production of 1.542 million t, of which 400,000 is reported as technical. We can use this for two purposes – the first is to estimate the Norwegian CN exports. Let’s say some of the CN is used for other products. One source to NAI has estimated the volume at 700,000 t from Norway, around 500,000 t more than that found in trade matrix. This still seems on the low side. If we add an additional 500,000 t to the trade
Table 3 - CN Importers Top Ten (product tonnes)
matrix figure, we arrive at trade of 1.1 million t, which is still short of the 1.9 million t of total imports from ITC reporting countries. This implies Norway’s exports are closer to that production figure. If we assume exports of 1.2 million t, which allows a volume into other products, this brings the trade matrix towards that 1.9 million t figure.
The Yara figure can also be used to refine the estimate for the agriculture/industrial split. From the Yara figure, approximately 30 percent is listed as technical. And so our working assumption, which we’ll extend to the global split, is 70 percent of consumption is for agriculture.
China is the second largest exporter with 185,000 t from the trade matrix. From a domestic production of around 255,000 t this suggests an apparent consumption of around 75,000 t. That consumption is less than the U.S. China’s reported exports for 2019 were 198,000 t but only 185,000 t could be found for the trade matrix.
China’s consumption is less than the U.S., does this seem reasonable? The production capacity might be understated. The NAI capacity is separated by company, and so this is more solid than simply being given an aggregate figure for China capacity. But to export 70 percent of production seems high. One possible explanation is that the local market is being developed and eventually these exports will reduce.
As can be seen from the following Table 4, Norway dominates exports, followed by China and then Poland, according to the ITC data.
* estimated by New AG International
Table 4 - CN Exporters Top Ten (product tonnes)
Global apparent consumption
is slightly less than PN, at 2.6
million product tonnes across agriculture and industrial uses, according to the NAI PIEC model, and fitting with published estimates of production capacities. It is worth remembering that even allowing for stock-building effects, consumption is unlikely to run above production capacity for any length of time. Using our estimated split of 70 percent agriculture, this suggests 1.8 million t CN for agricultural
When trying to gauge the consumption level for the
average sized market, we’re
talking in the tens of thousands.
The U.S. is the largest consumer, with a combination of domestic production (of around 60,000 t)
and reported imports of around 80,000-90,000 t per year; less
some exports, an apparent consumption of around
Egypt would be the second largest consumer because of a production capacity of 120,000 t. The country exports very little.
Another way that a trade matrix can be of value – few exports were picked up from Slovakia which, given the country has a production capacity of 80,000 t, would give an apparent consumption at a similar level to China, which wouldn’t make sense. Separate research suggests exports of 65,000 t and therefore a consumption of Slovakia of 15,000 t, which fits with our general assumption of consumption in the tens of thousands. ●
The following table summarizes where we have been in this first article in the series. We have seen the concentrated supply for both PN and CN and how this results in the traded volume forming a high percentage of apparent consumption. In the case of CN, the dominance of Yara production makes this percentage even higher. PN is also dominated by a single producer in Chile. Both products have agricultural and industrial usage, sometimes in small quantities, and this also explains why a high percentage is traded. But it presents a headache – how to estimate the split and therefore volumes involved in agricultural and industrial end use. ●