Adds Yara’s percentage of sales volume in Brazil, details on national fertilizer plan, paragraphs 6-8)
By Ana Mano
SAO PAULO, Dec 5 (Reuters) – Fertilizer maker Yara’s Brazilian business said on Tuesday it will start producing “green ammonia” in the South American country before the Norwegian company does so in Europe.
Yara, one of the world’s largest producers of fertilizers, said it has secured a biomethane supply contract from energy company Raizen to make green ammonia at a facility in the town of Cubatao in Brazil’s Sao Paulo state.
The green ammonia production process involves making ammonia which is 100% renewable and carbon-free, Marcelo Altieri, president of Yara’s Brazilian business, told a press conference, adding that output will begin in the second quarter of 2024.
Altieri, who took over as head of Yara’s Brazilian unit in September 2022, said the company is generally optimistic about the market this year in Brazil, where it has invested 10 billion reais ($2.03 billin) over the past 10 years.
He said fertilizer suppliers will deliver about 44 million metric tons of crop nutrients to Brazilian farmers at the end of 2023, compared with about 41 million tons in 2022. That level should remain relatively stable, he added.
Brazil, which contributes about 25% of Yara’s global sales volumes, is one of the company’s most important markets, along with Europe.
As such, Yara has been supporting development of a national fertilizer plan, which was proposed by the government in April 2022 to reduce the country’s reliance on imports.
Around 85% of the fertilizers used in Brazil come from imports, the government said when the initiative was announced. The plan will seek to reduce the percentage of imports to about 45% by 2050.
However, operating in Brazil has its challenges, especially as a result of the high price of natural gas.
“The objective is not for the price of natural gas to be lower,” Altieri said in response to a question. “The objective is for i to be competitive so that a national industry can be defended and developed.” ($1 = 4.9316 reais) (Reporting by Ana Mano in Sao Paulo Editing by Steven Grattan, Alexander Smith and Matthew Lewis)
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