FNA sets up body to promote farmer-owned fertilizer plant
Farmers of North America has formed FNA Fertilizer Limited Partnership to begin raising seed capital to lay the groundwork for a new farmer-owned fertilizer manufacturing facility.
In May, FNA said it was pondering the idea of building a fertilizer plant, noting that North America is a growing net importer of nitrogen fertilizer. Also, the boom in new natural gas production is providing a cheap feedstock for nitrogen fertilizer manufacturers.
But spokesperson Bob Friesen says FNA is not talking about getting into the manufacturing business itself.
“Rather, as we have done in the past, we are organizing and providing the catalyst to see a fertilizer plant built. Participation in fertilizer manufacturing will allow farmers to capture more of the value chain,’ Friesen said in a news release.
A FNA working group has conducted a review of the sector, looking into issues such as natural gas pricing, plant scale, market demand and competitive supply.
“The business case is compelling,” said Friesen. “The real question is if and to what extent farmers want to gain a return on investment to offset the high cost of fertilizer rather than merely paying for it.”
The intention of FNA Fertilizer Limited Partnership to connect committed purchase contracts for the products of the fertilizer plant to farmers that will own an equity stake in the plant provides a unique form of stability and risk mitigation to underpin the success of the project, while providing farmers a certainty of supply of a key farm input, the company said in a news release.
A new website, www.ProjectN.ca, has been created where FNA members and non-members can indicate their interest and sign on to commit to the project.