In the recent 3Q17 quarter, sales growth for fertilizer companies fell slightly YoY (year-over-year). The median sales growth for the eight companies we’ll be looking at in this series fell 2% YoY. Of these eight companies, four recorded YoY sales declines, while four recorded growth over the same period.
Companies with growth
Among the eight companies, CF Industries (CF) recorded the highest sales growth of 28% YoY to $870 million. Its sales growth came as a result of an increase in shipment volume, which was driven by the addition of new production capacity YoY. Agrium (AGU) was next with a sales growth of 8.7% YoY to 2.4 billion, driven by crop protection products under the umbrella of its retail segment. Israel Chemicals (ICL) reported a YoY sales growth of 4%, and Mosaic (MOS) reported a sales growth of 2% YoY.
Companies that declined
In contrast, Intrepid Potash (IPI) reported a YoY sales decline of 26%, followed by CVR Partners (UAN) with a sales decline of 12% YoY. Intrepid Potash’s sales fell as a result of lower potash shipment volumes and lower prices for its Trio product. CVR Partner’s sales fell primarily as a result of a lower price realization for ammonia and UAN (urea ammonium nitrate) prices.
The emerging theme
Shipment volumes and realized prices were key to the performances of the above companies (MOO). Some players have managed to increase shipments by increasing capacity, which may have come at the cost of others. On the other hand, movements in fertilizer prices for potash have positively impacted the potash segment, while the nitrogen and phosphate segments were negatively impacted.
In the next few parts of this series, we’ll look at the shipments and prices for each of the above companies.