The Herald Bulletin

Morning Update

Nation & World

July 19, 2013

Fertilizer industry grows despite safety concerns

(Continued)

TUSCOLA, Ill. —

Since then, new methods of finding natural gas — hydraulic fracturing, which uses high-pressure water and chemicals to break dense layers of rock, and horizontal drilling — have set off energy booms in parts of Pennsylvania, Texas and other states.

"It shouldn't be a surprise that there are a lot of people investing in the fertilizer business right now," said Pat Westhoff, an agricultural economist at the University of Missouri-Columbia.

Like Tuscola, most of the sites being considered are already home to other chemical facilities, which were drawn by the same rail lines and other industrial infrastructure that are attractive to the fertilizer industry.

Over the past two years, the trade publication Argus FMB North American Fertilizer has tracked about 20 proposed fertilizer projects in the United States and Canada, said Lauren Williamson, an Argus editor. Potential new plant locations include Indiana, Iowa, Illinois and North Dakota. Existing factories in Iowa, Louisiana and Oklahoma could be expanded.

Fertilizer is big business, especially in agricultural regions where farmers rely on nitrogen-based products. Profits for publicly traded fertilizer producers have averaged 20 percent or more over the last decade, according to Gary Schnitkey, an agricultural economist at the University of Illinois, about 25 miles north of Tuscola.

The plant proposed by Cronus Chemical promises about 2,000 short-term construction jobs and 150 permanent positions. That would make it the second- or third-largest local employer.

Agriculture is Tuscola's No. 1 industry, and the high profits of the past few years for corn and soybean farming have helped keep unemployment relatively low — just above 6 percent, well below the statewide rate that exceeds 9 percent.

Behind agriculture, tourism is a steady No. 2 industry. The town is built on the edge of Illinois' Amish country, drawing day-tripping tourists who flock to a homemade candy store and soda fountain.

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