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The Resumption of Fafen Sergipe Strengthens the Fertilizer Industry, Increases Jobs, and May Reposition the Northeast in the Sector, with Petrobras and Engeman Leading the Operations
On December 31, 2025, the resumption of ammonia production at Fafen Sergipe marked the beginning of a new cycle for the fertilizer industry in Brazil. The announcement was made by Petrobras, which has taken over the commercial management of the unit, while Engeman began to operate as a service provider. According to a publication from the Government of Sergipe this Monday (5), the reactivation of the factory represents a significant advance for job creation, industrial strengthening, and economic development in the Northeast, in addition to reducing external dependence on Fertilizers.
Resumption of Fafen Sergipe and the Strategic Role of Petrobras
The return of operations at Fafen Sergipe may reposition the state at the center of the national fertilizer strategy, after a period of stoppage that caused significant social and economic impacts. From the beginning of the process, the State Government has closely monitored each stage, through the State Secretary for Economic Development and Science and Technology (Sedetec), ensuring institutional support for the resumption.
The ammonia production at Fafen Sergipe began on the last day of 2025, officially ending the stoppage that had begun in March 2024. Petrobras’s decision to reactivate the unit reinforces the state-owned company’s commitment to industrial policy and the security of national supply.
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Furthermore, this move occurs at a time of global attention to the Fertilizer market, marked by price fluctuations and geopolitical risks. In this context, increasing domestic production of inputs such as ammonia and urea becomes strategic not only for industry but also for Brazilian agribusiness.
Thus, the resumption of Fafen Sergipe goes beyond an institutional announcement. It signals a change in posture regarding national fertilizer production, with a focus on predictability, efficiency, and regional integration, especially in the Northeast.
Production Capacity and Job Creation in the Northeast
Fafen Sergipe has an installed capacity to produce up to 1,800 tons of urea per day. Meanwhile, Fafen Bahia, which is part of the same industrial complex, can reach 1,300 tons per day. Together, the two plants have the potential to generate around 800 direct and indirect jobs, distributed across industrial operation, maintenance, logistics, and associated services.
Job generation is one of the most immediate impacts of the resumption, benefiting not only workers directly linked to the factory but also various segments of the local economy. Thus, the reactivation strengthens regional income and boosts economic dynamism in Sergipe and neighboring states.
In addition to the social impact, continuous production of Fertilizers helps to consolidate the Northeast as a strategic industrial hub, reducing regional disparities and encouraging long-term investments.
Engeman Takes Over Operations and Petrobras Leads Commercial Strategy
With the end of the lease agreement with Unigel, Petrobras structured a new operational model for Fafen Sergipe. In this format, Engeman acts as a service provider responsible for operating and maintaining the plant, while the state-owned company is responsible for commercial activities and strategic management.
This arrangement seeks to ensure greater operational stability and productive control, avoiding frequent interruptions that marked previous periods. Engeman was contracted after a bidding process, with the contract signed in September 2025, also covering the Bahia unit.
Thus, the combination of Petrobras’s expertise and Engeman’s technical action creates a safer environment for the sustainable resumption of Fertilizers production in the Northeast.
The Government of Sergipe Monitors the Resumption of Fafen Sergipe
The Government of Sergipe has played an active role in all phases of the resumption of Fafen Sergipe. Sedetec has maintained constant dialogue with Petrobras and Engeman, monitoring technical, administrative, and institutional aspects of the process.
According to Secretary Valmor Barbosa, the State remains available to ensure that the factory operates with total regularity, directly contributing to the state’s economic development. This institutional action is crucial for creating a favorable environment for heavy industry, especially in energy and capital-intensive sectors.
Additionally, government support reinforces the importance of the factory as a strategic asset for the Northeast, expanding its contribution to the regional and national economy.
The History of Fafen Sergipe and Its Importance for Fertilizers
Established by Petrobras in 1980, Fafen Sergipe has consolidated itself as one of the main hubs for ammonia and urea production in the Northeast. Its installation drove infrastructural projects in the state, such as the São Francisco River aqueduct, along with improvements in energy, transportation, and telecommunications.
Over the decades, the factory has been a vector for regional development, generating hundreds of jobs and stimulating the creation of a complementary industrial park. However, operational challenges and changes in the economic landscape led to periods of reduced shifts and stoppages.
In 2018, Petrobras announced the hibernation of the unit. After negotiations mediated by the state government, in 2019, the plant was leased to the private sector, with operations resuming in 2021, supported by tax incentives and infrastructure improvements.
Recent Stoppages and New Phase with Engeman and Petrobras
Despite the previous resumption, Fafen Sergipe faced difficulties again starting in 2023. Unigel, the then-operator, cited economic unviability and promoted two stoppages, culminating in the suspension of activities in March 2024.
This scenario highlighted the need for a new management model, capable of ensuring productive continuity and financial sustainability. After judicial alignments, Petrobras opened bidding for the selection of a new operating company, won by Engeman.
With the resumption of ammonia production at the end of 2025, expectations are for greater operational predictability, strengthening the Fertilizers chain and reducing risks of new interruptions in the Northeast.
Economic Impacts of Fafen Sergipe for Brazil
Brazil still significantly depends on importing fertilizers, which exposes the country to international price and supply fluctuations. In this context, the resumption of Fafen Sergipe represents a step forward in reducing this vulnerability, increasing national production of essential inputs for agribusiness.
Additionally, Petrobras’s involvement in this segment reinforces the state-owned company’s role as a driver of industrial development. Local fertilizer production contributes to the competitiveness of the agricultural sector and to balancing the trade balance.
At the same time, strengthening the industrial base in the Northeast promotes greater regional balance, stimulating economic growth outside traditional large centers.
A New Cycle for the Fertilizer Industry in the Northeast
The resumption of Fafen Sergipe marks the beginning of a new cycle for the Brazilian fertilizer industry. With the participation of Petrobras, Engeman’s operation, and the support of the Government of Sergipe, the unit returns to play its strategic role in national supply.
More than reactivating an industrial plant, the process symbolizes the reconstruction of an integrated production policy, capable of generating jobs, boosting local economies, and strengthening the Northeast as an industrial hub. The continuous operation of Fafen Sergipe reinforces the importance of fertilizers for the country’s development and signals a stronger path for the national industry in the coming years.
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