Polish state-controlled producer Grupa Azoty, and PKN Orlen subsidiary Anwil have suspended nitrogen fertiliser output, citing the surge in gas prices.
Azoty said today that it is indefinitely suspending nitrogen fertiliser production at its largest plant in Pulawy, eastern Poland, as well as units producing chemicals including polyamide and caprolactam. The shutdown follows gas prices reaching fresh records, Pulawy's key feedstock.
Azoty will reduce its ammonia production to just 10pc of capacity and will continue to produce a limited number of products including AdBlue as well as humic acid, condensed nitric acid and catalysts.
There is no restart date, and the company will monitor the gas market and profitability of production before making new decisions.
Pulawy reduced its output last month when it first lowered and then in early August suspended production of melamine. The reduction represented a change in Azoty's earlier policy to produce fertilisers at nearly full capacity despite high gas prices.
While production is suspended, Azoty will conduct maintenance and modernisation works. The firm posted four different updates on its transparency platform since yesterday evening, which if summed together would mean more than 54.4 GWh/d of unavailable capacity, although some of these closures do not overlap (see table). Given their limited time nature, these listings probably reference maintenance and modernisation works. If all four of these facilities' entire production capacity went unused, then this would total just under 78 GWh/d.
Poland's gas demand as a whole dropped by 10pc on the year in the first half of 2022, led by a drastic decrease in sales to industrial users.
Pulawy is Poland's largest single gas consumer with an annual demand of about 1.1bn m³/yr. Azoty's gas supplier, Polish state-owned supplier PGNiG, continued to supply the plants with gas feedstock despite the halt of Russian gas supply to Poland in April but was forced to draw upon more expensive LNG and pipeline gas from within Europe. PGNiG recently extended an existing agreement to supply gas to Grupa Azoty until the end of September 2023.
And Polish fertiliser producer Anwil also halted nitrogen fertiliser production today, again citing high gas prices as the reason. Anwil operates an ammonia and CAN plant in Wloclawek in central Poland.
Anwil said it would conduct maintenance and investment works at the Wloclawek plant while monitoring the gas market with an eye to restoring production "as soon as market conditions stabilise".
| Grupa Azoty UMM notices | kWh/h | |||
| Firm | Start date | End date | Unavailable | Total capacity |
| Grupa Azoty S.A. | 30/08/2022 | 13/09/2022 | 265,000 | 265,000 |
| Grupa Azoty Zaklady Azotowe "Pulawy" S.A. | 23/08/2022 | 25/08/2022 | 920,000 | 1,470,000 |
| Grup Azoty Zaklady Chemiczne S.A. | 22/08/2022 | 07/09/2022 | 790,000 | 835,000 |
| Grupa Azoty ZAK S.A. | 17/08/2022 | 29/08/2022 | 291,803 | 671,400 |
| — Gas Inside Information Platform, Grupa Azoty | ||||
