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In a surprise move, Yara announces it will suspend production of phosphate fertilizers, resulting in the layoff of hundreds of employees. The company claims to be focused on sustainable operations, but the move has sparked concern among workers and local authorities, who are seeking alternatives.
In an unexpected turn of events that shook the industrial sector In São Paulo, the Norwegian multinational Yara announced the gradual suspension of the production of phosphate fertilizers and sulfuric acid in its units in Cubatão and Paulínia.
The measure, which is expected to be completed by the third quarter of 2025, will result in the dismissal of hundreds of employees, generating concern and uncertainty in the region.
Suspension of activities and dismissals
Yara reported that the “hibernation” of the phosphate and sulfuric acid plants is part of a strategy to concentrate on more sustainable operations focused on its main activity: the production of nitrogen fertilizers.
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In Cubatão, the suspension will affect units 3 and the phosphate plants of unit 2, while units 1 and 2, responsible for the production of nitrogen, in addition to the mixer (unit 5), will continue to operate normally.
The decision will result in the dismissal of approximately 219 employees at the Cubatão unit, in addition to a similar number of outsourced workers.
Financial results and restructuring in Yara
The decision comes after Yara reported a net loss of $290 million in the fourth quarter of 2024, reversing the $246 million profit it made in the same period a year earlier.
In the year to date, the company recorded revenues of US$ 13,934 billion, a drop of 10,83% compared to US$ 15,627 billion in 2023. In contrast, EBITDA increased by 20%, reaching US$ 2,051 billion.
In light of this scenario, Yara announced a cost reduction and investment program of US$150 million, with the aim of optimizing its operations and focusing on strategic areas to ensure long-term sustainability.
Local impact and mitigating measures
The news generated concern among local officials and authorities.
The Baixada Santista Chemists' Union stated that, although additional benefit packages were negotiated beyond the rights provided for by law, this “will never be enough for those who lose their jobs to which they dedicated so many years.”
The City of Cubatão held a meeting with representatives from Yara to understand the measures adopted and seek alternatives to mitigate the effects of layoffs on the local job market.
One of the initiatives includes a meeting between Mayor César Nascimento and Vice President and Minister of Development, Industry, Commerce and Services, Geraldo Alckmin, in Brasília, to discuss possible solutions that strengthen the industrial sector in the region.
Future prospects and investments
Despite the adversities, Yara highlighted the start of renewable ammonia production in Cubatão, in December 2024, reinforcing its commitment to sustainability and innovation.
The company stated that Cubatão continues to be strategic for its operations in Brazil, with nitrogen assets that represent a competitive advantage and growing potential in generating value for the national industry.
Yara also emphasized that the supply of fertilizers to the Brazilian market will not be affected by the suspension of activities at the phosphate units, ensuring that it will continue to serve its customers with high-quality products.
Economic and social impact
The suspension of activities at the Cubatão and Paulínia units represents a significant impact not only for the employees directly affected, but also for the local economy, which is deeply connected to the international market.
Mass layoffs could result in increased unemployment and reduced income in the region, affecting several sectors of the local economy.
Local authorities and unions are seeking alternatives to minimize the negative effects of this decision, including relocating laid-off workers and attracting new investments to the region.
The meeting with Minister Geraldo Alckmin is one of the initiatives in this regard, aiming to discuss measures that can strengthen the industrial sector and promote sustainable economic development in Cubatão and Paulínia.
For experts, Yara's decision to suspend the production of phosphate fertilizers and sulfuric acid in Cubatão and Paulínia reflects a strategic restructuring of the company, focused on more sustainable operations and aligned with global sustainability and innovation trends.
However, this measure brings significant challenges for affected employees and the local economy, requiring coordinated actions between the company, authorities and unions to mitigate the social and economic impacts arising from this decision.
The company is adapting to the global agenda on sustainability and good practices in agricultural production. An agenda that has never been concerned with unemployment rates in order to achieve this.
This mass resignation is the result of the incompetence of the Lula government and its incompetent ministers.
Blaming the government for the poor efficiency of a private company is intellectual ignorance, to say the least!
Bad management is ignorance of business management itself!