Cenex Harvest States recently announced plans to build a $1.2 billion anhydrous ammonia plant in eastern North Dakota, taking advantage of the state’s abundant natural gas supplies. It’s one of several plants that are in the works in the country, he said.
Anhydrous ammonia is a crop fertilizer.
Kaufman called the development as significant as ethanol was to corn growers. Nitrogen is found in natural gas and a key ingredient in the fertilizer. The only place in the world with cheaper natural gas than the United States is the Middle East, he said. Cheap natural gas means cheap nitrogen and inexpensive anhydrous ammonia, Kaufman said.
The plants will be located in areas where there is abundant natural gas, he said.
Kaufman predicted the United States will become a nitrogen exporter in the future. If that happens, he added, U.S. farmers will have a competitive edge in crop production costs compared to the rest of the world.
“This is a big deal for you as producers,” Kaufman said.
Kaufman says BNSFcurrently transports a lot of urea fertilizer to Montana.
The anhydrous ammonia plants won’t be built for the next two to five years, Kaufman said. None have been announced in Montana, he said.