INTERFAX - Almaz Fertilizers LLC (former OJSC Hydrometallurgical Plant, GMZ, Lermontov, Stavropol Territory), which is part of the Almaz Group enterprises, is thinking about increasing capacities due to growing demand for mineral fertilizers amid the situation with coronavirus.
"The world pandemic closed our traditional Chinese competitors to a number of countries in the sowing season (access to products - IF), so we feel an increased demand for our products for export and an influx of new customers," Almaz Group PR Director Anastasia Kharitonova told Interfax Group.
The company does not plan to revise forecasts related to the production and financial indicators.
“So far, Almaz Group has no reason for this; for this month, all purchases were carried out as planned last month. If non-working days will be extended, there may be problems with the supply of raw materials, spare parts and accessories. In connection with the increased demand for Almaz Fertilizer products, we think about increasing production capacities,” said Kharitonova.
According to her, "there is an issue associated with dollar rate and demand for products in the domestic Russian market.” "Since raw material prices depend on dollar rate, the final cost of production automatically rises, which will inevitably lead to issues with the domestic market," she said.
Moreover, if the railway, regional borders and federal highways are not closed to carriers, then there should be no problems with the execution of orders, said Kharitonova adding that "here we are tied to logistics.”
Speaking about the work of the plant in April, she noted that production runs. "We do not stop production, because we have a continuous cycle enterprise: we will stop - there will be no harvest, and feeding people is our main task. In addition, due to the specifics of production, preservation of the chemical plant will take at least a month," said Kharitonova.
The enterprise also fulfills obligations to Rosatom for the restoration of the tailing pond, which are ongoing, she explained.
When asked whether negotiations are ongoing with banks on deferred payments or other exemptions, she replied that now most of the measures taken by the Russian government are aimed at supporting medium and small businesses.
“At the moment, Almaz Group did not seek targeted assistance, simply because the number of employees does not allow us to classify ourselves as medium-sized businesses, but we believe that we will need financial support in the medium term,” PR director of Almaz Group said.
At the same time, according to her, the possibilities of soft loans for Almaz Fertilizers (reduced rate, deferred payments), participation in existing programs to help exporters with respect to subsidizing part of the costs and implementing investment projects at the regional level are being discussed.
She also said that accounting, HR department, legal department, some services of the administrative and economic unit of the "Almaz Group” will work with restrictions or on a remote basis. “Our commercial department works in special loading mode and also on a remote basis,” she added.
Earlier it was reported that OJSC GMZ intended to double production by the end of 2021.
Since the resumption of production in November 2018, the plant has produced 100 thousand tons of water-soluble and granular fertilizers for a total amount of 3.5 billion rubles. As Interfax was informed at the enterprise, the production volume is planned to be increased up to 200 thousand tons per year. Currently, the plant produces 15 thousand tons of products per month.
As noted in the press release, the positive dynamics is ensured by the modernization program, within the framework of which it has already been possible to double the capacity of the production site for water-soluble fertilizer - monopotassium phosphate. Next year, GMZ plans to complete the upgrade of production of water-soluble potassium sulphate, as a result of which its output will grow 10 times.
The plant has been producing phosphate group mineral fertilizers for more than 50 years, which can be used not only to increase soil fertility, but also in the production of feed additives. The enterprise has more than 300 customers in more than 60 countries.
According to the SPARK-Interfax system, in 2018 the plant received a revenue of 147 million rubles against 2.4 billion rubles in 2017, a net loss of 900 million rubles against a net profit of 54 million rubles a year earlier.
The Almaz Group enterprise group (Stavropol Territory), in addition to Almaz Fertilizers LLC, includes Intermix Met LLC, CJSC Southern Energy Company and Cashmere Capital Trading House.