Grupa Azoty Zakłady Azotowe Kędzierzyn S.A., a fertilizer production company, has decided to scale down its operations to 43% capacity due to record high prices for natural gas. The increase in gas prices is a result of Russia's aggression against Ukraine. Gas prices have surged from EUR 72/MWh in February 2022 to EUR 280.50/MWh in August 2022. While gas availability is not an issue, the unpredictable and extraordinary situation in the gas market is affecting the profitability of production activities. The company will continue to monitor prices and make further business decisions accordingly.
Due to record high prices for natural gas, the main production feedstock used by Grupa Azoty Zakłady Azotowe Kędzierzyn S.A., on August 23rd 2022 the Company’s Management Board decided to scale down the operation of the Fertilizer Production Unit to the minimum capacity of 43% as of August 24th 2022.
As a consequence of Russia’s aggression against Ukraine, since February 24th 2022 natural gas prices on the European exchanges have been soaring to extraordinary, historically high levels. Over the past six months, gas prices surged from EUR 72/MWh on February 22nd 2022 to EUR 280.50/MWh on August 23rd 2022.
Although there are no problems with the availability of gas, the current situation in the gas market, which determines the profitability of production activities, is extraordinary and completely beyond the control of the Grupa Azoty Group, and could not have been predicted.
The Company constantly monitors the price level of all raw materials and commodities as well as the profitability of production processes, and will make further business decisions based on the results of the monitoring.