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China eyes green ammonia exports by late 2024

  • Market: Fertilizers, Hydrogen
  • 30/03/23

While new clean ammonia projects are being regularly confirmed in Australia, Europe, the Americas, India and the Middle East, news on green ammonia projects in China has been noticeably absent until recently. But the country's technological prominence, the large land mass it has available to develop renewable power on, and its reputation for constructing projects quickly, may see China becoming a leading exporter of green ammonia, starting as early as the fourth quarter of 2024.

According to information obtained by Argus, Chinese merchant clean ammonia capacity is due to increase sharply within a matter of months, with 40 green ammonia projects reported to be in the development and pre-approval stages. The country is seemingly leapfrogging the blue ammonia approach being favoured by some other nations in Europe and the Middle East, and investing instead in large-scale green ammonia research and construction projects. One plant in the north of China, owned by Envision Energy, has a 20,000 t/yr green ammonia plant currently under construction, which will be followed by a ramp-up to 300,000 t/yr. Industry sources said that the plant, which will run on wind power and is located in Inner Mongolia, could be ready to start exporting green ammonia by late 2024. The Inner Mongolia region has increasingly become the focus for hydrogen and ammonia facilities run on renewable energy over recent months.

In the past month alone, several large-scale renewable green ammonia plants have been announced in China. State-owned China State Shipbuilding (CSSC) and Inner Mongolia's Tong Liao city government signed an agreement to produce green hydrogen and ammonia using 500MW of wind power. And last week, state-owned energy firm China Energy Engineering outlined plans for a $1.5bn renewable hydrogen, ammonia and methanol plant in northeast China.

Tsinghua Straits Research Institute is conducting feasibility studies into renewable hydrogen and its feed products, including green methanol, green ammonia and biomass fuels, it told Argus.

Investment is also being directed into port infrastructures to support a potential expansion of ammonia exports. Fujian Yongrong is constructing a 20,000m³ ammonia tank in Yuexiu Port, Fujian province, while Shanghai ICT Developer Energy Technology is constructing five ammonia tanks with a total capacity of 300,000m³ in Yancheng Port, Jiangsu province. Meanwhile in China's biggest ammonia port, Zhanjiang MIC Chemenergy plans to expand its ammonia storage capacity in Zhanjiang Port from 600,000 t/yr at present, to 1mn t/yr in 2025 and 1.5mn t/yr in 2030.

But the higher price of renewable ammonia compared with grey ammonia leaves questions about potential export demand in the short term. At prevailing electricity prices of around 0.3 yuan/kWh, green ammonia production costs are Yn2,829/t ($410/t) according to estimates given by State Power Investment (Spic) at a recent industry conference. Transportation costs to ports and trader margins could add a further $100/t to this cost, bringing realistic export prices for green ammonia from China to above $500/t. While conventional grey ammonia cfr prices in the east Asia region have been sharply above $500/t for much of 2022 and early 2023, the region's import prices have been dropping rapidly this month and are now trading in a $355-385/t cfr range on a spot basis. The commitment to these green projects could be tested over the coming months as a result.


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19/07/24

Von der Leyen faces new Green Deal challenges

Von der Leyen faces new Green Deal challenges

The president promises a ‘clean industrial deal', but will need to make compromises over climate policy, writes Dafydd ab Iago Brussels, 19 July (Argus) — Ursula von der Leyen's re-election by the European Parliament as president of the European Commission on 18 July promises to see a doubling down on climate and energy policy, with her 2024-29 mandate stipulating greenhouse gas (GHG) emissions cuts of at least 90pc by 2040 compared with 1990. "I have not forgotten how [Russian president Vladimir] Putin blackmailed us by cutting us off from Russian fossil fuels. We invested massively in homegrown cheap renewables and this enabled us to break free from dirty Russian fossil fuels," von der Leyen says, promising to end the "era of dependency on Russian fossil fuels". She has not given an end date for this, nor specified if this includes a commitment to ending Russian LNG imports. Von der Leyen went on to detail political guidelines for 2024-29. She has pledged to propose a "clean industrial deal" in the first 100 days of her new mandate, albeit without giving concrete figures about how much investment this would channel to infrastructure and industry, particularly for energy-intensive sectors. The clean industrial deal will help bring down energy bills, she says. Von der Leyen told parliament that the commission would propose legislation, under the European Climate Law, establishing a 90pc emissions-reduction target for 2040. Her political guidelines also call for scaling up and prioritising investment in clean technologies, including grid infrastructure, storage capacity, transport for captured CO2, energy efficiency, power digitalisation and a hydrogen network. She plans to extend aggregate demand mechanisms beyond gas to include hydrogen and critical raw materials, and notes the dangers of dependencies and fraying supply chains — from Putin's energy blackmail to China's monopoly on battery and chip raw materials. Majority report Passing the necessary legislation to implement her stated policies will now require approval from EU states and parliament. Unless amplified by Germany's election next year, election victories by far-right parties in France and elsewhere appear not to threaten EU state majorities for specific legislation. Parliament's political centre-left S&D and liberal Renew groups, as well as von der Leyen's own centre-right European People's Party (EPP), have elaborated key policy requests. These broadly call for the continuation of the European Green Deal — a set of legislation and policy measures aimed at 55pc GHG emissions reductions by 2030 compared with 1990. A symbolic issue for von der Leyen to decide on — or compromise on — is that of internal combustion engine (ICE) vehicles. EPP wants to stick to technological neutrality and revise the current mandate for sales of new ICE cars to be phased out by 2035, if they cannot run exclusively on carbon-neutral fuels. The EPP wants an e-fuel, biofuel and low-carbon fuel strategy. Von der Leyen's guidelines reflect the need to gain support from centre-right, centre-left and greens. She says the 2035 climate neutrality target for new cars creates investor and manufacturer "predictability" but requires a "technology-neutral approach, in which e-fuels have a role to play". She has not mentioned carbon-neutral biofuels. It will be impossible for von der Leyen to satisfy all demands in her second mandate. This includes policy requests put forward by the EPP, ranging from a "pragmatic" definition of low-carbon hydrogen and market rules for carbon capture and storage, to postponing the EU's deforestation regulation. EU member states are expected to propose their candidates for commissioners in August, including for energy, climate and trade policy, with von der Leyen's new commission subject to a final vote in parliament in late October. Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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India's June NP/NPK output and sales up, imports down


19/07/24
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19/07/24

India's June NP/NPK output and sales up, imports down

London, 19 July (Argus) — India's output of NP/NPK fertilizers rose on the year in June, while domestic sales climbed sharply, but imports fell. June NP/NPK production rose by 4.9pc on the year to 917,400t, as imports decreased by 5.4pc to 264,000t, provisional government data show. Sales under India's direct benefit transfer (DBT) system reached 1.343mn t last month, up by 51pc year on year. The data for trade and production imply total NP/NPK stocks in India of just over 5.168mn t at the end of June, down by 3.1pc on the month and 1.6pc on the year. Domestic NP/NPK production in April-June — the first three months of India's 2024-25 financial year — reached almost 2.512mn t, up by 2.9pc on the corresponding period of 2023-24. April-June DBT sales were up by 42.1pc on the year at 2.185mn t, while imports decreased by 20.1pc to 709,000t, the data show. India's import market for complex fertilizers has been in a quiet phase as participants focus on a pricing-based impasse around DAP . A resolution of the DAP situation should in turn lead to a rise in import activity around NPS and NPK grades, including key formulae 20-20-0+13S and 10-26-26. Prices for these products are set to climb in next business, in line with a general firming of the global market for complex fertilizers. By David Maher Indian NP/NPK stocks, output, imports, and DBT sales Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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Indian DAP stocks fall by 430,000t in June


19/07/24
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19/07/24

Indian DAP stocks fall by 430,000t in June

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EU’s von der Leyen re-elected as Commission president


18/07/24
News
18/07/24

EU’s von der Leyen re-elected as Commission president

Brussels, 18 July (Argus) — The European Parliament today approved Ursula von der Leyen's re-election as president of the European Commission. Nominated by EU states in June, von der Leyen received 401 votes, by secret ballot, from parliament's 720 newly elected members. Von der Leyen called for continuing climate and energy policy in her 2024-29 mandate to achieve greenhouse gas (GHG) cuts of at least 90pc by 2040 from 1990 levels. "I have not forgotten how [Russian president Vladimir] Putin blackmailed us by cutting us off from Russian fossil fuels. We invested massively in homegrown cheap renewables. And this enabled us to break free from dirty Russian fossil fuels," said von der Leyen, promising to end the "era of dependency on Russian fossil fuels". She did not give an end date for this, nor did she specify if this includes a commitment to end Russian LNG imports. Von der Leyen went on to detail political guidelines for 2024-29. In the first 100 days of her new mandate, she pledged to propose a "clean industrial deal", albeit without giving concrete figures about how much investment this would channel to infrastructure and industry, particularly for energy-intensive sectors. The clean industrial deal will help bring down energy bills, she said. Von der Leyen told parliament the commission would propose legislation, under the European Climate Law, establishing a 90pc emission-reduction target for 2040. Her political guidelines also call for scaling up and prioritising clean-tech investment, including in grid infrastructure, storage capacity, transport infrastructure for captured CO2, energy efficiency, power digitalization, and deployment of a hydrogen network. She will also extend aggregate demand mechanisms beyond gas to include hydrogen and critical raw materials. Her political guidelines note the dangers of dependencies or fraying supply chains, from Putin's "energy blackmail" or China's monopoly on battery and chip raw materials. Majority report Passing the necessary legislation to implement her stated policies will now require approval from EU states and from parliament. Unless amplified by Germany's election next year, election victories by far-right parties in France and elsewhere appear not to threaten EU state majorities for specific legislation. Parliament's political centre-left S&D and liberal Renew groups, as well as von der Leyen's own centre-right EPP, have elaborated key policy requests . These broadly call for the continuation of von der Leyen's Green Deal, the set of legislation and policy measures aimed at 55pc GHG emission reduction by 2030, compared with 1990 levels. A symbolic issue for von der Leyen to decide, or compromise on, is the internal combustion engine (ICE). Her EPP group wants to stick to technological neutrality and to revise the phase-out, by 2035, of new ICE cars if they cannot run exclusively on carbon-neutral fuels. The EPP wants an EU e-fuel, biofuel, and low-carbon fuel strategy. Von der Leyen's guidelines reflect the need to gain support from centre-right, centre-left, and greens. For the ICE phase-out, she said the 2035 climate neutrality target for new cars creates investor and manufacturer "predictability" but requires a "technology-neutral approach, in which e-fuels have a role to play." She made no mention of carbon-neutral biofuels. It will be impossible for von der Leyen to satisfy all demands in her second mandate. That includes policy asks put forward by the EPP, ranging from a "pragmatic" definition of low-carbon hydrogen, market rules for carbon capture and storage, postponing the EU's deforestation regulation, to catering more for farmers, even by scrapping EU wildlife protection for wolves and bears. EU member states are expected to propose their candidates for commissioners in August, including those responsible for energy, climate, and trade policies. When parliament has held hearings for candidates in late October, von der Leyen's new commission would then be subject to a final vote. By Dafydd ab Iago Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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EU fertilizer industry calls for support: Q&A


17/07/24
News
17/07/24

EU fertilizer industry calls for support: Q&A

London, 17 July (Argus) — As the EU gears up to install a new European Commission for 2024-2029, LAT Nitrogen's chief executive officer Leo Alders tells Argus political support remains necessary to tackle a range of challenges threatening EU industry, including subsidised US ammonia production with carbon capture, use and storage (CCUS), and the EU's 'unrealistic' goal of cutting net greenhouse gas (GHG) emissions by 90pc by 2040. But Alders sees growing political "goodwill" to help EU industry against cheap fertilizer imports from Russia, which are used to fund the country's war against Ukraine. Edited highlights follow. What does the fertilizer industry want from the next European Commission? Clear points are effectively releasing emissions trading system (ETS) funds for converting the industry to green fertilizers. We also want carbon sequestration to be allowed as it is in the US. And we need a policy on nutrient efficiency, which has never really happened. For us, too, spillage is not the desired objective. The international context, too, is important. Grey ammonia produced in Europe could move to the same cost levels as US blue ammonia with subsidised CO2 sequestration. If or when that happens, then Europe will see massive imports of US blue ammonia. We think that by 2027 or 2028, volumes coming out of the US will grow exponentially. That's a trend that we think is unstoppable. The underlying issue, of course, is that energy in Europe is at higher price levels than on any other continent. We need to stay in Europe with our production capacity. But the threat is there. Are 90pc GHG cuts by 2040 feasible for you? When discussing the ETS measures, the carbon border adjustment mechanism, and so on, we took a positive approach as an industry. And we go alon g with the zero [carbon] target for 2050. That's all right. But now the [2040] target is not official, more a desired milestone that emissions will be cut by 90pc by 2040. As an industry, we think that target is totally unrealistic and cannot support it. That's a clear point of view. Converting to a green industry will require massive capital. Technologically, it takes time to do all of this. Is the ETS working well for the fertilizer industry? Proceeds from ETS certificates go partly to national budgets and partly to the EU budget. That's all nice. But our industry needs to invest massively to complete the transition. We pay massive amounts of money for CO2 certificates. There was the promise that national and EU levels would subsidise decarbonisation projects from the ETS. In reality, we've seen very few subsidies materialising. So we actually have a counter-proposal: why not allow the industry to park the money for green investments? In theory, the national level is obliged to reinvest 50pc of ETS income back into the industry. The reality is different. Isn't the EU still wary of prohibitive €100-150/t tariffs on Russian fertilizers? A ban on Russian fertilizer imports would require unanimity. Tariffs, though, require majority support among EU states. That seems feasible. At least 15 states appear to support the idea. There is actually no supply issue. We don't have any issues replacing Russian volumes. There may be a possible time element and rebalancing in the first three or four months. But after that, the European industry would be fully capable of supplying our farms. So political support is growing? More and more people understand how Russian gas is being transformed into fertilizer. They've understood that routing gas to Europe is becoming more and more difficult. The EU has been totally unsuccessful in pushing back against Russian urea, so Russia is building some 650,000 t/yr in extra capacity, expected on line next year or thereafter. As an industry, we don't want to be shutting down units in Europe because of cheap subsidised Russian fertilizers. And then, what happens if one day Russia decides to cut or weaponise fertilizer supplies? By Dafydd ab Iago Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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