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AMMONIA FUEL NETWORK (2009)
Addiction to imported petroleum carries with it huge economic, environmental and national security risks for the United States and other developed countries. The search for a domestically produced, economical and environmentally friendly fuel has led to one acceptable solution, anhydrous ammonia. Also known as "the other hydrogen", ammonia is the closest thing to a perfect transportation fuel. Ammonia is an ultra-clean, energydense alternative liquid fuel. Along with hydrogen, ammonia is the only fuel that does not produce any greenhouse gases (GHG) on combustion.

FERTILIZER'S UPS AND DOWNS (2009)
Fertilizer prices in 2009 will be as unpredictable as the spring's weather. There's a one-ton elephant in the room where fertilizer dealers and farmers are in a standoff. Dealers think the animal is worth close to $1,000, while farmers calculate its worth at maye half that price. Nobody seems ready to budge, but, by spring, everybody has to leave the room. This predicament started last summer when dealers started to build fall and spring inventory while fertilizer and crop prices struggled to find a top. With corn worth more than $7.00 at the time, NH3 priced at more than $1,000/ton still penciled a profit for farmers.

PART OF THE SUPPLY CHAIN (2008)
The volatility of 2008 will likely change the fertilizer industry forever. "In 2008 retailers took the market risk because they didn't have commitments or agreements with farmers," Stone says. "They're going to be looking for ways to hedge that risk with growers." That's the way Vernon already does business. His fertilizer sheds are full of fertilizer, but farmers prepaid for all of it before he placed the orders. "I don't short the market," he says. "There's product in the buildings, but I don't own it." Mid Kansas Cooperative offers customers a propriety program that allows them to lock in grain sales at the same time they purchase inputs. "We talk a lot about locking in and locking up and we haven't changed our strategy," Vernon says. "We believe in today's market you need to take action on both sides. If you want to lock up fertilizer prices, then we suggest you talk to our grain-marketing folks at the same time. Those decisions are no longer independent."

SPRING SUPPLY (2008)
A wet spring in 2008 only made the situation worse. With a delayed harvest and seasonal rains, only about 50% of the normal amount of fertilizer was applied in the fall. "The reduction in fall-applied fertilizer could lead to a substantial increase in demand for spring-applied fertilizer, placing additional strain on the supply chain," Farrell says. "We could see spot shortages of supply as a result of this increased short-term demand, which could mean some farmers may not be able to obtain all of the fertilizer they would like, when they would like to have it this spring...Can the fertilizer distribution system handle two seasons of product in one season? We have always found a way to make it work," Vernon says. "We've pulled a rabbit out of the hat three of the last five years." But, he admits, the rabbit is a lot bigger this year.

MARKET vs. MARKET SHARE (2008)
That's the dilemma Appel sees for Midwest retailers. "Retailers will fight to the bitter end to keep customers," he says. "But the ones who bought earlier are competing with dealers who did nothing and now can buy cheaper fertilizer. The biggest risk those retailers face is how much money they have to lose to keep customers. That second group can use their cheap fertilizer to either build their customer base with price as a weapon, or lock in some windfall profits. I think we'll see more localized pricing in 2009 than ever before, depending on when dealers made their purchases."

A TRUE INNOVATION: AMMSYNTM IS HERE! (2008)
A new process under development named Ammonia Synthesis (AMMSYNTM) takes an entirely different approach to producing ammonia. AMMSYN works much like a fuel cell in reverse, and does not require high pressures. In fact, AMMSYNTM does not use a Haber-Bosch reactor at all, since AMMSYNTM does not produce hydrogen as an interim product. The hydrogen feed in the AMMSYNTM process is steam from a boiler, and the water from which the steam is produced does not have to be distilled or overly pure. The AMMSYNTM equipment "cracks" the steam into hydrogen and oxygen on an electrocatalyst, the hydrogen is converted into a proton by stripping off an electron with an electronic circuit, and the proton traverses a proton-conducting ceramic electrolyte to combine with nitrogen on the other side of the electrolyte.

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