OREANDA-NEWS. Chairman of Acron Board of Directors Alexander Popov comments on the results:

"In 9M 2014, Acron Group's output of key commercial products was 4,840 kt, up 5.5% year-on-year. Mineral fertiliser output increased 2.1% to 4,013 kt.

"These higher operating results are mainly attributable to a 21.1% increase in UAN output in the reporting period, made possible by an upgrade that increased the UAN unit's capacity to 1 mn tpa in early 2014. NWPC (the Oleniy Ruchey mine) also contributed to the results: apatite concentrate output in 9M 2014 reached 631 kt, up 41.9% year-on-year. In July and August 2014, the Oleniy Ruchey mine's monthly output was 86 kt of apatite concentrate. In Q4 2014, the processing plant's capacity will increase to 100 kt per month and annual output will reach 1.1 mn t of apatite concentrate.

"Complex fertiliser output was up 2.2% due to the output increase at our Veliky Novgorod (Russia) and Hongri Acron (China) facilities. The Veliky Novgorod facility was able to boost its output because of sustainable supplies of apatite concentrate produced by the Group.

"Industrial products output was up 16.8% to 757 kt due to a 52.1% increase in calcium carbonate output and a 27.8% increase in hydrochloric acid output.

"In September and October 2014, Dorogobuzh and NWPC conducted a scheduled preventive repair and overhaul of their main shops, and that adversely affected our performance in Q3 and Q4 2014. However, this decrease will be fully offset by an increase in capacity, and the Group's operating results in general have demonstrated a positive dynamic since the beginning of the year."

Market trends

"In Q3 2014, nitrogen fertiliser and NPK markets saw slight price growth along with interruptions in natural gas deliveries to countries producing nitrogen fertilisers, primary to Ukraine and Egypt. Urea prices were supported by the expected closing of China's export window. Despite lower crop prices, the buying activity of fertiliser consumers has not slowed. Decrease in demand is limited to certain regions, such as the U.S., where a record crop yield is expected.

"Despite of the fact that over 9M 2014 the global prices for key nitrogen fertilisers were down 4-8% year-on-year, Q3 2014 prices were higher than in Q2 2014 and Q3 2013.

"In Q3 2014, NPK prices reached a peak on the back of stable potash sales and growing phosphate fertiliser prices."