100 YEARS YOUNG
When Yara President and CEO Thorleif Enger rang the bell to start trading of the Yara share in March 2004, he also rang in a new era for a company that will be 100 years young on December 2, 2005.
Yara is the leading supplier of plant nutrients in the form of mineral fertilizers and internationally recognized as the most global player in the fertilizer industry. We also develop and market a growing ‘industrial’ portfolio, that includes environmental and food industry products. Behind our name change, from Hydro Agri to Yara, lies a century-long tradition of innovative technologies, commercial daring and strategic partnerships.
Breakthrough
The Yara story began in 1905, when a group of scientists produced the world's first commercially viable nitrogen fertilizer (calcium nitrate) in Notodden, Norway. Using the Birkeland-Eyde process, which utilized hydroelectric power to extract nitrogen from air, they provided the solution to one of the most pressing problems of the day – adequate food supply.
The use of minerals as plant nutrition began with German chemist Justus von Liebig’s discovery that organic nutrients need to be mineralized in order to be taken up by the roots of the plants. His work resulted in the world’s first industrial phosphorous fertilizer based on naturally occurring minerals in 1842, and the commercial supply of mineral potassium followed a few years later.
But available sources of mineral nitrogen, like Chile salpeter, were limited, and agricultural output had stagnated at the beginning of the 20th century. With nitrogen being the main plant nutrient, Europe, Asia, Australia and America faced the challenge of how to provide enough food for their increasing populations. Intensive research efforts were set in motion to develop a feasible method for industrial manufacture of nitrogen for plant nutrition. But it was a combination of Norwegian hydroelectric power and scientific and technological excellence, matched by Swedish, French and German capital that provided the breakthrough.
It attracted immediate attention from the rest of the world and resulted in the foundation of Norsk Hydro on December 2nd, 1905. The entrepreneurial spirit embodied by Hydro’s leading lights – Kristian Birkeland, Sam Eyde and Marcus Wallenberg – also played a key role in Norway’s modernization during the 1900s.
War and peace
Although Hydro later diversified into other fields, mineral fertilizer remained one of its core products and became an essential ingredient in modern agriculture. In the same way that it allowed farmers to increase their harvests and fostered optimism in the early 1900s, mineral fertilizer helped to re-establish food supplies in Europe after World War II. Despite the destruction of the war, Hydro was quick to resume fertilizer production and deliveries to Europe. In this way, it was able to contribute to the post-war industrial renewal being prioritized by European governments. In turn, Europe became the cornerstone for Hydro’s development into the only global supplier of plant nutrition and agronomic services.
Pioneering spirit
During the 1960s there was a major shift in fertilizer technology, with hydrocarbons becoming the chief source of raw material for ammonia, the main nitrogen intermediate. Hydro’s ammonia production in Norway moved from hydroelectricity to hydrocarbons and two new ammonia plants were built in Porsgrunn.
At the same time, Hydro also made moves to secure access to raw material supplies by entering North Sea oil exploration and, in 1969, establishing Qatar Fertiliser Company (Qafco) as a joint venture with Industries Qatar. Qafco played a key role in the Qatari government’s industrialization program and provided Hydro with a high-quality low-cost fertilizer production facility. Qafco is now the world's largest single site producer of urea and ammonia and a model of successful partnership.
By the 1970s, Qafco’s strategic location and Hydro’s growing sales and logistics network, had helped extend operations to Asia, the Middle East, South America and Africa. Hydro’s fertilizer division (Hydro Agri) was characterized by a pioneering spirit, combined with a unique emphasis on domestic marketing and local partnership. This proved a winning strategy and reinforced Hydro’s willingness to invest in and develop emerging markets. China followed in 1982 - twenty years before it became the world’s largest fertilizer consumer – and Agri then set its sights on developing the African market. A Zimbabwe office was opened in 1985, and a presence established which lasts to this day.
Turnaround to demerger
Hydro Agri extended its marketing network during the nineties and continued to expand through strategic acquisitions in key growth markets and collaboration with key partners around the globe. However, in response to stiff industry competition and market forces, the company launched a three-year turnaround program from 1999-2001 to reduce costs and improve productivity. As a result, Agri became Europe’s leading low-cost fertilizer producer.
From 2002, Agri achieved a position within the top 25 percent of its industry peers and control of a six percent share of the global mineral fertilizer business. On March 25, 2004, Hydro Agri was demerged from Norwegian industrial conglomerate Norsk Hydro ASA and listed as Yara International ASA. Yara could focus on its core business, develop market ambitions and position itself for value creation. Today, Yara is the world’s leading provider of mineral fertilizers, with operations in 50 countries on five continents.
Industry shaper
Yara’s first 100 years have been a process of constant change, and this will continue for the next 100. At the same time, we have taken great care to preserve the best of our traditions, as symbolized by the Viking Ship brand. A century of innovative technologies, commercial daring and strategic partnerships has equipped us with financial strength and leading knowledge. We aim to use this to partner with growers in realizing sustainable food production for the world’s growing population. And we aim to take the leading role in shaping the fertilizer industry into a model of sustainable business.
In this way, by embracing change and ensuring continuity, we are building a solid future for ourselves, our partners and the community.
