Polish refiner PKN Orlen's Anwil resumes fertiliser output

The company cited food security as the driver
calendar icon 30 August 2022
clock icon 2 minute read

Polish refiner PKN Orlen's Anwil subsidiary is resuming production of nitrogen fertilisers on food security grounds, while the country's biggest chemicals maker Grupa Azoty said it has continued to supply carbon dioxide to its customers, reported Reuters.

Both Anwil and Azoty halted output last week due to surging gas prices, though the food industry warned the resulting lack of carbon dioxide (CO2) deliveries could impact food security in the country.

"Despite the difficult conditions on the gas market, Anwil resumes production of fertilisers and thus raw CO2. We are doing everything to make this product, used in the medical industry and for food production, available on the Polish market," PKN's Chief Executive Daniel Obajtek said on Twitter.

Azoty said as of Sunday it had hiked CO2 production to 60% capacity from 30% at its Puławy subsidiary.

"Thus, both CO2 and dry ice deliveries had been and are secured for all existing recipients," Azoty said, adding that it limited CO2 and dry ice export, as a result of which its warehouses are full.

Anwil said in a separate press release that fertiliser prices after production resumes will reflect the current price of natural gas and market conditions.

The CO2 produced by chemical makers as a byproduct is used in various parts of the food industry, including to cool products during transportation, stun poultry and pigs before slaughter, and add fizz to drinks.

Several European chemical companies have curtailed ammonia production due to soaring energy costs, with Norway's Yara, one of the world's largest fertiliser makers, the latest to slash its output last week.

An Azoty spokeswoman told Reuters there were no changes to its earlier announced fertilisers production cuts and the company was monitoring the situation.

Erste Group analyst Jakub Szkopek said that with 70% of ammonia output curtailed in Europe, it is likely that fertiliser prices will start to rise in the region in the coming weeks.

The Polish government, which is the largest shareholder in PKN with a 35.66% stake, said last week it would prepare measures to intervene in the fertiliser market after it was affected by soaring gas prices.

A spokesperson at the state assets ministry that oversees the companies said that work on support measures was underway.

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