European Union maintains anti-dumping duty on Russian ammonium nitrate

| Foreign Markets |

The European Commission has taken an important decision for the EU manufacturers of fertilizers. The step is to extend the period of validity of the anti-dumping duties on ammonium nitrate imported from the Russian Federation. Over the next five years, there will be a duty of 47 EUR per ton of ammonium nitrate. The reason of this decision is the need to protect the European chemical industry from the negative results of the importation of fertilizers from the East.

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More expensive fertilizers within a decade

| Products |

The lack of common EU policy on energy results in Russia treating particular countries in various manner during trade negotiations concerning the pricing of natural gas. Consequently, the cost of manufacturing nitrogen-based fertilizers is rising at a different pace in various countries.

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Gas from Spain?

| Foreign Markets |

Until recently, Spain has not been associated with the trade of energy resources. However, the country is now likely to become one of the countries which matter in this sector of the global economy.

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Potassium from Belarus back in the game?

| Foreign Markets |

The chemical sector has not forgotten the market shake-up, which happened in Belarus Potash Company (BPC) last summer. That “divorce” triggered radical changes on the market. Let us examine the current situation of Belorussian chemical-fertilizer industry in this context.

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Russia wants fertilizers duty lifted

| Foreign Markets |

In February 2013, Court of Justice of the European Union ruled that the anti-dumping duty on Russian fertilizers complies with EU law. Russia has not given up the fight yet, however, and has already turned to WTO with a request to conduct consultations with the European Union.

The root of the problem

Natural gas is a staple resource in the production of artificial fertilizers. Russia, with its dual-pricing policy, sells the fuel at different prices to domestic and foreign clients. Benefiting from cheaper gas, Russian fertilizer manufacturers enjoy lower production cost, which enables them to decrease fertilizer prices. In order to resist such unfair competition, the EU imposed anti-dumping duties on Russian fertilizers. In February 2013 European Court of Justice confirmed that the tax is in line with EU legislation. Naturally, the Russians were not convinced.

WTO member states have their obligations

The Russian Federation appealed to WTO for an intervention. However, let us not forget that the country has yet to fulfill its obligations concerning the liberalization of natural gas pricing. Fertilizers Europe, an association of leading European fertilizer manufacturers, including Grupa Azoty S.A., is confident that WTO will dismiss the Russian application, asserting the right to impose and calculate the anti-dumping cost.

What goes around comes around

The plaintiff may easily become the defendant. In this scenario, the EU would complain to WTO about Russia not having acted on the vow to liberalize natural gas prices. The abolition of dual-pricing could involve rising the prices of natural gas for the Russian clients. The consequences of such a move for the economy of the Russian Federation are difficult to predict, however.

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Better and cheaper urea from Russia

| Production & Resources |

Uralchem in cooperation with the Faculty of Chemistry at Moscow State University have signed an agreement with Stamicarbon, concerning an innovative method of urea production.

The method involves using the patents of the Dutch company and the experience of cooperation between the Russian conglomerate and Moscow State University. The cooperation has continued since 2008, when research started in order to obtain 100% carbon dioxide conversion in the production process. The new method is to enable cheaper production of urea of the highest quality. Once the technology is ready, it will be made available to companies worldwide via the trade of commercial licenses.

The test production shall be launched in Uralchem plants, but the installation will be designed by Stamicarbon, the global leader in the trade of urea production licenses.

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