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- DTN Headline News
Subtle Changes Following West Explosion
Friday, April 18, 2014 3:25PM CDT

By Russ Quinn
DTN Staff Reporter

OMAHA (DTN) -- On the surface, it seems not much has changed for the fertilizer industry in the year since the deadly fertilizer retail business explosion in West, Texas.

There are no new federal or state regulations mandating how fertilizer be stored or handled since that April 17, 2013, tragedy in central Texas. However, there are new fertilizer industry initiatives which will put more attention on the regulatory process for retailers.

The West blast shocked the fertilizer industry because of the death and destruction it caused, but also for another reason: It showed federal regulations and adherence to best practices, such as meeting regularly with emergency responders, were not being universally followed by all fertilizer retailers, said Kathy Mathers. Mathers is vice-president of public affairs for The Fertilizer Institute (TFI) based in Washington, D.C.

The overwhelming majority of fertilizer retailers, both large and small, have become very sophisticated in terms of regulatory compliance, she said.

After West, there was a groundswell of support within the fertilizer industry for initiatives to build knowledge of regulatory requirements and then assist all retailers to follow them.

With this in mind, TFI and the Agricultural Retailers Association (ARA) created a program called ResponsibleAg. This is an independent, not-for-profit organization designed to support fertilizer retailers' awareness and compliance with federal safety and security regulations, she said.

"Under ResponsibleAg, all of the nation's retail fertilizer dealerships will have access to comprehensive inspections based on federal regulatory requirements," Mathers told DTN. "The inspections will be carried out by professionally trained auditors who will have successfully completed an intensive training course based on the objectives of ResponsibleAg."

Mathers said while the vast majority of fertilizer retail businesses operate safely and securely, TFI and ARA are acting out of an abundance of caution and concern for the wellbeing of workers and communities. They are choosing to act now to more quickly address these types of issues, she said.

ResponsibleAg will certify auditors to inspect and verify individual facilities' level of compliance with applicable federal regulations. The facilities which successfully complete an assessment will receive a list of recommended corrective actions with a certain timeframe to complete these actions.

Additionally, random quality assurance reviews to verify these assessments will be conducted.

Mathers said the National Fire Protection Association has also called together a special task force to examine best practices for ammonium nitrate storage and emergency response. Industry experts have lent their expertise to this task force as well.

"Although we are still awaiting the final Chemical Safety Board (CSB) report on West, Texas, it is clear that emergency responders had insufficient information regarding safe procedures for responding to a fire involving ammonium nitrate," she said.

The Fertilizer Institute has also worked with ARA to update guidelines for industry, government agencies and emergency responders, Mathers said. This document, titled "Safety and Security Guidelines for the Storage and Transportation of Ammonium Nitrate Fertilizers," has been completed and is being widely disseminated through the industry.

Mathers said by forming ResponsibleAg, the industry is stepping forward to ensure that all fertilizer retailers have the information they need to operate safely and comply with all regulatory requirements.

RETAILERS SEE MORE SCRUTINY

Fertilizer retailers say while they have not been subjected to more rules and regulations by the federal and state governments, they have seen their businesses be put more in the public eye by what happened in West, Texas. More rules and regulations could be on the way in the future, they point out.

Storm Sammons, location manager for Central Valley Cooperative located in Owatonna, Minn., said while there are no new rules or regulations in place currently, his industry has had more attention than in the past. His business is located outside the Owatonna city limits, but does have other businesses, including a Cabela's store, and Interstate 35 close by.

"I think how we operate as a fertilizer retailer is under more scrutiny today than it was before the West tragedy," Sammons said. "I don't think this is necessarily a bad thing; if anything, maybe more people will notice how safe we are operating our businesses."

Sammons said there is no hiding that the fertilizer industry handles materials that can be dangerous if they aren't handled or stored correctly. Fertilizer retailers need to be upfront with the public and have an open line of communication with local fire departments that would respond to any fertilizer facility fires, he said.

Bob Spratt, manager of LeRoy Fertilizer Services of LeRoy, Ill., said he also believes more attention is being paid to the fertilizer industry, especially in communities were retailers are located. Whether good or bad, the increased amount of attention is happening, he said.

"I think the tragedy in West puts the industry under a microscope," he said. "I feel, however, the industry does a very good job of being safe and protecting the environment."

Spratt said fertilizer retailers should try to stay in the good graces of their communities, given the nature of their business. Community members are the ones who will be directly affected by retailers' actions and have to see it every day, he said.

"I also live there, too," he added.

Sammons believes the general public should continue to be educated on how safe fertilizer retailers have to be to operate their businesses. Retailers should also have an emergency plan so the public can feel more secure about having these facilities in their communities.

"We have so many safety rules in place when operating our businesses, and I don't know if everyone knows this," Sammons said.

When asked if his business ever considered having an open house to educate the general public on how a fertilizer retailer business operates, Sammons said in the past his company left such education to state trade groups like the Minnesota Crop Retailers Association.

Sammons added, though, maybe this is something retailers need to do more of in the future.

INSURANCE COSTS RISING WITH AN?

One Midwestern fertilizer retailer is taking the step of eliminating the ammonium nitrate (AN) part of its fertilizer retail business. Since the company's customers have not been notified of this change set to occur before the 2015 growing season, the retailer did not want to be identified.

"It is a good, useful product for our customers, but it is not worth the problems associated with it anymore," the retailer said. "I'm sick over it."

The retailer, who handled considerably less AN than the West fertilizer retailer did, said there really were two main reasons why his business decided to get rid of AN from its product line.

First, the business fears the skyrocketing insurance costs associated with storing AN. Because of the high insurance payouts expected to be paid in West, insurance premiums to store AN could increase significantly for retailers in the future, he said.

The retailer compared this situation to a town getting hit by a hailstorm and everyone getting new roofs and siding. Most likely the premiums for everyone there would be higher going forward due to the insurance payouts, he said.

The second reason for eliminating AN from the business' storage facility is the location of its structure -- in a town's industrial area. Other buildings fairly close to the fertilizer facility include several other businesses, a school and even a hospital.

"Our facilities are top-notch and we go well beyond all the safety regulations, but we have so many other businesses so close to us here," he said. "Can you imagine if we ever did have an emergency, having a hospital less than a half of a mile away? It just isn't worth it anymore storing AN."

The retailer added that if his company's facility was located away from other businesses, he would "most definitely" continue to store and sell AN.

Russ Quinn can be reached at russ.quinn@dtn.com


Editor's Note: To see complete DTN coverage of the West, Texas, explosion aftermath, please see the DTN/The Progressive Farmer In-depth site at http://www.dtn.com/…

(ES/AG/CZ)


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