Yara increases production in challenging fertilizer market

Yara has published its 2016 Annual Report, including complete 2016 Annual Accounts with notes. 2016 was a challenging year, where the fertilizer industry sector was confronted with oversupply and falling margins. In a heavily competitive market, Yara increased its deliveries and production capacity. Some highlights from the annual report:

Growing in India
Yara entered into an agreement to acquire the Tata Chemicals’ Babrala urea plant and distribution business in Uttar Pradesh for USD 400 million. This acquisition represents a significant step in the company's growth strategy, creating an integrated position in the world's second-largest fertilizer market. India has strong population growth and increasing living standards, and significant potential to improve agricultural productivity. The plant has an annual production of 0.7 million tonnes ammonia and 1.2 million tonnes urea. Yara expects to close the deal in 2017.

Investing in Brazil
Yara decided to invest approximately BRL 1 billion (USD 275 million) in expanding and modernizing their Rio Grande plant. Set for completion in 2020, the investment will create one of the biggest and most modern fertilizer sites in the Americas. The expansion project will double the site's current 0.8 million tonnes annual fertilizer production and blending capacity, and provide customers with increased access to Yara's products, thereby reducing reliance on finished fertilizer imports.

Improving operations
The Yara Improvement Program is the most significant corporate improvement program in Yara’s history. The aim is to make Yara fit for the future & positioned for sustainable growth by delivering at least USD 500 million EBITDA in cost and operational improvements within 2020, in addition to other cash effects and added value through the enhancement of our sales & marketing activities. The program represents the collective results and best practices of a set of internal improvement initiatives, spanning the entire company, that were developed in response to changing market conditions calling for increased cost efficiency and continuous improvement. The program is organized into a set of concrete projects established to deliver improvements across the company. The improvement program is established and already delivering improvements.

Divesting CO2 business
On 1 June 2016 Yara completed the sale of their European CO2 business and the remaining 34% stake in the Yara Praxair Holding AS joint venture for more than EUR 300 million to US-based Praxair Inc.

Digital tools and services
Yara reached an agreement with the Bulgarian company MicroAccount and acquired a Farm Management System business in Bulgaria and Romania.

For more information:
www.yara.com/2016