OSTCHEM plants produced 1.8 million tons of mineral fertilizers in 2024

In 2024, OSTCHEM nitrogen holding (part of Group DF) reduced mineral fertilizer production by 13% y/y – to 1.8 million tons. This is stated in the press release of Group DF.

Last year, Cherkasy Azot maintained its production level at 1.4 million tons, while Rivne Azot reduced its output by 22% year-on-year – to 407 thousand tons.

OSTCHEM cited low grain prices on global markets, power outages, the ongoing war, and cheap, low-quality imports as the reasons for the decline in production.

According to Sergiy Pavlyuchuk, Production Director of OSTCHEM’s nitrogen business, the margins of the Ukrainian agricultural business have fallen significantly, which has affected domestic demand for fertilizers. Sometimes priority was given to cheaper fertilizers of dubious quality, which were massively imported into the country last year.

“We play the long game, and even in the most difficult times, we ensure high international quality of our products and 100% fulfillment of our obligations. Even during the periods of forced shutdowns of Rivne Azot due to power outages, these business values remained unchanged, as Ukrainian farmers could see,” he emphasized.

OSTCHEM’s average annual capacity utilization in 2024 did not exceed 70%.

“Unfortunately, we were forced to cut staff and optimize costs. According to my estimates, the decline in the chemical industry was about 10%, and this is the result of growing imports and ineffective industrial policy,” explained Sergiy Pavlyuchuk.

He added that in 2025, OSTCHEM has adapted to the military business environment and will maintain its focus on developing new industrial sites, energy efficiency, ensuring stable operations and improving product quality.

“The key objective for 2025 is to ensure production sustainability in the current unstable energy supply environment, reduce production risks, and displace imports with better quality. The long-term strategic priority remains the same: import substitution and, accordingly, an increase in market share,” said Pavlyuchuk.

As noted, OSTCHEM will continue to invest in the production of the most popular fertilizers and expand its product line. Last year, the holding launched a new UAN production facility at Rivne Azot with a capacity of 300 thousand tons per year. New investment projects are also planned for 2025-2026, primarily related to the launch of urea and industrial gases production.

As GMK Center reported earlier, in 2023, OSTCHEM’s plants increased their fertilizer production by 19.5% y/y. Cherkasy Azot produced 1.56 million tons of mineral fertilizers in the period under review (+39.6% y/y), while Rivne Azot produced 528 thousand tons (-10.8% y/y).

OSTCHEM is a nitrogen holding of Group DF that unites the largest mineral fertilizer producers in Ukraine. It includes Rivne Azot, Cherkasy Azot, Severodonetsk Azot and Stirol (which are not operating and are located in the occupied territories).