Ukraine's Ostchem reduces fertilizer production 4.3% in H1
MOSCOW. Aug 6 (Interfax) - Ostchem, the fertilizer division of Ukraine's Group DF, produced 918,500 tonnes of mineral fertilizer in the first half of 2024, 4.3% less than in the same period of 2023, Ukrainian media reported, citing a press release from the company.
The company's Cherkasy Azot plant produced 717,800 tonnes and Rivneazot produced 200,700 tonnes.
Ukrainian media reported the company as saying that heavy dumping of imports led to a decline in domestic production of the most popular fertilizers in the country, ammonium nitrate and urea. Ostchem plants reduced production of the former by 9% to 362,900 tonnes from 398,700 tonnes a year earlier, and output of the latter by 10.8% to 183,600 tonnes from 205,900 tonnes.
However, the company managed to strengthen its position on the UAN market, increasing production by 11.4% to 309,200 tonnes in the first half from 277,700 tonnes a year earlier. Ostchem attributed this to strong demand for this fertilizer and the logistical advantage of Ukrainian producers.
In order to meet the growing demand, new UAN production facilities are operating at Cherkasy Azot and Rivneazot with annual capacity of 1 million tonnes and 300,000 tonnes, respectively.
"Uncontrolled imports are doing the greatest harm to the chemical industry. Due to the dominance of cheap fertilizer from countries friendly to Russia, production volumes fell by 4.3%," the head of Ostchem's nitrogen business, Sergei Pavlyuchuk was quoted as saying in the press release.
"In addition to disruptions in power supplies due to the destruction of energy infrastructure, there is also a shortage of workers, [...] there is a labor deficit of about 15%. We are forced to retrain personnel, who are mastering new skills," he said.
The company said Ukraine imported 1.298 million tonnes of nitrogen fertilizers in the first half of 2024, including 176,600 tonnes of ammonium nitrate, 311,300 tonnes of urea, 108,500 tonnes of NPK, 159,800 tonnes of sulphate, 77,710 tonnes of NP and 50,800 tonnes of UAN.
Group DF consolidates the assets of Dmitry Firtash in the gas distribution, chemical, titanium and port sectors, as well as agriculture and media. Ostchem, the group's nitrogen division, consolidates the largest mineral fertilizer producers in Ukraine.