Colombia’s low-carbon fertiliser producer

Colombia

Andrés Useche, regional director for the Andean region for Yara Latin America, talks to The Energy Year about the role the company has in Colombia’s fertiliser market and its plant expansion and decarbonisation initiatives. Yara produces and markets crop nutrition products and industrial nitrogen solutions.

What role does Yara have in Colombia’s fertiliser arena, and how much does it produce?
Colombia is a market that moves around 2 million tonnes of fertilisers per year, while its real consumption is around 1.6-1.8 million tonnes. The most consumed product is nitrogen, and within this, urea is a key product which is imported. The country imports between 350,000-400,000 tonnes of urea annually. There is no urea production plant in Colombia.
Yara is the only company in Colombia producing fertilisers with a low carbon footprint. In Cartagena we have a production plant which uses environmental nitrogen and natural gas, and with these raw materials we produce fertilisers based on ammonium nitrate.
Our Cartagena plant has an annual production capacity of 300,000 tonnes of granular NPK [nitrogen, phosphorus and potassium fertiliser], 120,000 tonnes of calcium nitrate and 130,000 tonnes of ammonia. To produce fertilisers and ammonia, gas is required.
The availability and cost of gas has always been a challenge for us, as it has a higher cost per million Btu than in other markets we are present in. Despite that, we continue producing, and we are the market leader in Colombia, accounting for 40-45% of the market share.
Our plant in Cartagena is an asset for the country, catering to national needs. Despite this, we export to several countries in Central America, especially calcium nitrate and some surpluses of grey ammonia. We have the only calcium nitrate plant in Latin America and are the only ammonia producer in Colombia.

What does Yara’s recent investment entail in terms of plant expansion and decarbonisation?
We have made investments in Colombia in the last two years, worth around USD 100 million. These investments have two main goals. The first one is to expand the capacity of our plant by 25%, which is equal to 80,000 tonnes yearly. The expansion plan started in 2023 and is due to finish in September 2025.
This means that we are going to deliver more fertilisers to the Colombian market, contributing to the country’s food security. Food production is critical to the country, and the fertiliser business backs it up. We see substantial growth in the agribusiness sector in Colombia, which will require more fertilisers.
For instance, the coffee and palm sectors are on the rise, while corn and soy have a lot of potential. We are net importers of the latter products, and we could replace imports with domestic production.
The second goal of this major investment is the decarbonisation of our fertiliser production. This project has been already completed and has led to a reduction of 60% in the carbon footprint of our fertiliser production.
In other words, the reduction we have achieved in CO2 emissions is equivalent to eliminating 500,000 tonnes of CO2 equivalent annually or the equivalent of taking 160,000 vehicles off the roads. This is a great contribution to the country.

Where does Yara get its gas, and how key is the production of ammonia for the company?
Yara, as a company in Colombia, is one of the country’s largest off-takers of gas. Additionally, we consume about 23,000 tonnes of grey hydrogen per year. That’s why transition projects of green and blue hydrogen are so attractive to us as off-takers. The gas we consume belongs to Ecopetrol. We also buy gas from other players, such as Canacol Energy.
Due to shortages in gas supply seen during El Niño, natural gas was sent to thermal plants as a priority. We are now negotiating with public authorities to be regarded as a priority gas consumption company for the production of fertilisers, which are critical for food security.
Natural gas is also essential in the production of ammonia. We are the only company in Colombia that produces ammonia, having a production capacity of 130,000 tonnes. We supply ammonia to the domestic market, and we export grey ammonia to markets such as the Caribbean, Central America and the United States when we have a surplus.
Our advantage is that we can import and export ammonia from Cartagena. Being a local ammonia producer is a great advantage for the country. If at some point we decide to produce green ammonia, which is very probable, we can export ammonia from Cartagena to other markets. Many claim that Colombia has the potential to become a powerhouse for green ammonia.

Tell us about your Yotocó facility on the Pacific coast and its essential role in distribution.
Colombia has an advantage over other countries, and that is the fact that we have a coastline on the Atlantic and the Pacific. I think we are behind in terms of infrastructure, especially in terms of ports.
In the Pacific we have the Yotocó plant, which is a storage, packing and blending facility, with a capacity of 420,000 tonnes. It is one of the most modern plants in Latin America. From there we supply parts of the west, south and east of the country.
As a company, we can import fertilisers from any of our 28 plants worldwide through the Pacific. Our Yotocó plant is in the municipality of Valle del Cauca, just 60 kilometres away from the port of Buenaventura, which makes it strategic for us to import product from elsewhere.
When it comes to distribution, we sell directly to farms, and then around 65% goes to third parties that collect the product from the plant.

How important is Colombia and Latin America for Yara’s global portfolio, and what bet is it making on green and blue ammonia production?
Colombia is very important for our business in the Americas because it is the only plant that produces NPK on the continent. In terms of revenue, the Andean region accounts for 45-50% of Latin America’s revenue.
Yara is making significant efforts to grow in Mexico, where there is a huge potential for agriculture, and the same goes for Argentina. Moreover, in July 2024 Yara signed an MoU with Atome PLC for the commercialisation of renewable fertilisers to be produced in Paraguay.
The next steps are first to make more and better partnerships with food companies, highlighting the value of using low-carbon fertilisers. The second goal is to complete the expansion project of the Cartagena plant to increase its capacity by 25% by 2025. The third point is to start working on the transition or changeover, probably from gas to another source, such as blue or green ammonia, for the Cartagena plant.
Colombia could be a hub for green ammonia moving forward, and our plant in Cartagena is in a key location. As a company we are now developing two very important projects in the US in the area of blue ammonia. That will be a huge source of energy for Europe and certainly for the Americas.

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