Dakota Gasification Competition
Now Viewing Dakota Gasification's competition in: Chemical Manufacturing - Agricultural
Call Preparation Questions
Customers, Marketing, Pricing, Competition
What crops are the company's products used for? - Corn and cotton use large amounts of fertilizer.
Does the company have long-term contracts with big customers? -
Does the company sell directly to cooperatives and large farms? -
How much of total production does the company sell to dealers? -
How many competitors make the same product? - There are often just a few competitors for each product.
Is a dominant company in the industry the price leader? -
Competitive Landscape
Demand for agricultural chemicals depends mainly on demand for various crops, which in turn depends on crop prices. The profitability of individual companies is linked to efficient operations and marketing. Big producers have large economies of scale in production. Smaller companies can compete effectively by making specialty chemicals or fertilizer mixtures for local markets. The industry is capital-intensive: annual revenue per employee at a large plant is close to $700,000.
Full Industry Overview For Chemical Manufacturing - Agricultural
Business Challenges
CRITICAL ISSUES
Volatile Raw Material Prices - Producing nitrogen fertilizer requires access to large supplies of ammonia, which is made from natural gas, a commodity with high price volatility. The cost of natural gas represents as much as 80 percent of the cost of ammonia. In recent years, the market price of natural gas has varied between $2 and $10 per thousand cubic feet (mcf), and availability has sometimes been restricted.
Government Regulation - Due to environmental, safety, or health issues, both federal and state governments restrict the production, distribution, application, and disposal of pesticides, fertilizers, and other agricultural chemicals. The EPA regulates the use of most pesticides because of their negative impact on water sources and animal life. Ongoing chemical testing could lead to a ban on some agricultural products if toxicity levels for humans are found to be unacceptable.
Industries Where Dakota Gasification Competes
- Energy & Utilities
- Oil & Gas Exploration & Production
- Chemicals
- Agricultural Chemicals
- Basic and Intermediate Chemical & Petrochemical Manufacturing
