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Lithuania's Achema fertilizer plant to suspend operations as of Sept because of rising gas prices
VILNIUS. Aug 26 (Interfax-Ukraine) – Lithuania’s Achema, the largest producer of nitrogen fertilizer among the Baltic countries and the country’s biggest consumer of natural gas, plans to suspend operations on September 1, 2022, because of rising gas prices and the uncontrollable increase in production costs, Achema said in a statement.
Achema, which has been operating at reduced capacity since last autumn, said that it would now only operate its soil and technical gas production facilities.
"Record prices for natural gas directly affect production costs, and prices for our fertilizer are becoming uncompetitive compared to products from Russia and the United States. Given the current market situation, most Western fertilizer producers are forced to suspend operations at their plants, and Achema is no exception," CEO Ramunas Miliauskas said.
Once the plant has suspended operations, some of the staff will service the equipment, while the remaining employees will go on downtime.
Swedbank in July extended a loan of 40 million euro to Achema in order to replenish its working capital. Antanas Sagatauskas, head of the corporate banking division, noted at the time that the plant had a significant impact on the entire country’s economy, so it "needs to be assisted in overcoming the current market turbulence, and to provide a basis for sustainable growth in the future."
Achema, controlled by the Achemos group, has been purchasing gas on Western markets since the Lithuanian government decided in the spring to stop importing Russian gas.
