Agrium Inc

Nitrogen selling prices PotashCorp (POT) sells nitrogen fertilizers such as ammonia, urea, and nitrogen solutions. It competes with other natural gas–based nitrogen producers such as CF Industries (CF) and Terra Nitrogen (TNH), which primarily produce and sell nitrogen fertilizers. Agrium (AGU), which is a part of the PowerShares International Dividend Achievers ETF (PID), produces nitrogen fertilizers […]

Demystifying the cost curve Earlier in this series, we saw that prices of nitrogen have fallen over the years, despite its significance in crop growth and feeding the vast population. The lower prices are due to a flatter cost curve, which we’ll explain in this part. Flat cost curve In the chart above, we compare a […]

Chinese producers primarily use coal to produce nitrogen, especially urea-based fertilizers, while producers in North America mostly rely on natural gas.

The current levels of ammonia prices at several locations are below their comparative levels last year.

Producers in China mainly use coal as an input material to produce nitrogen fertilizers, especially urea. China is impacted by price movements in coal.

Monsanto’s business is the best fit for Bayer’s Crop Science segment—it contributes ~22% of Bayer’s revenue. The segment is similar to Monsanto’s business.

The global nitrogen fertilizer capacity is abundant, allowing it to fulfill the current market requirements. This has put pressure on nitrogen prices, which fell significantly over the past year.

The gross margin rate for Mosaic’s Phosphate segment fell significantly in 2Q16, to 10% from 21% in 2Q15.

In 2014, the cost of production for DAP per ton ranged from $190 to $450 per metric ton, as we can see in the chart.

The Mosaic Company (MOS), which acquired CF Industries’s (CF) phosphate business in 2014, is the largest producer of phosphate globally.

The petroleum (or pet) coke index remained unchanged from the previous week during the week ending July 22, 2016.

Ammonia prices in the Southern Plains had the steepest fall of 10.5% last week, continuing the previous week’s trend.

Israel Chemicals, which shipped 0.5 million metric tons during the recent quarter, saw the largest jump in shipment growth—20% year-over-year.

The fertilizer industry moves in cycles and with most companies experiencing a decline in margins, the industry seems to be in the bottom cycle.

Ammonia is used to make phosphate fertilizers like DAP (diammonium phosphate) and MAP (monoammonium phosphate).

Last, average MAP prices in Brazil inched up to $353 per metric ton from $352 per metric ton the previous week.

As most global ammonia production is upgrading to urea, ammonia prices may affect urea prices.

MAP (monoammonium phosphate) is the second-most used phosphate fertilizer after DAP (diammonium phosphate).

For fiscal 2Q16, Monsanto reported EBITDA (earnings before interest, tax, depreciation, and amortization) of $1.8 billion.

Fertilizer prices and input costs affect all players in the industry. Survival and profitability come down to where a company stands on the cost curve.

Mosaic purchases certain raw materials at fixed costs to be consumed over time, but the selling prices of its finished goods can fluctuate rapidly.

Mosaic doesn’t sell directly to farmers. Its customers include cooperatives, wholesale distributors, retail chains, and independent retailers.

In the 2010–2011 planting season, phosphate fertilizers accounted for about 23% of total NPK fertilizers consumed globally.

As of February 19, CF Industries pays a quarterly dividend of $0.3 per share. In 2015, it paid an annual dividend per share of $3.6—down from $5 in 2014.

As of January 19, 2016, the VanEck Vectors Agribusiness ETF (MOO) returned -12.7% in 2015. YTD as of January 19, the ETF is down by 8%.

CF Industries’ cash flow to capital expenditure ratio has been falling. CF Industries’ cash flow to capital expenditure ratio stands at 0.75 as of 3Q15.

Uralkali’s move towards a volume-over-price strategy in order to gain market share (more like taking back market share) was the more important story.

The United States is the biggest user of corn, consuming 265 million mt (metric tonnes) of corn in 2012—equivalent to 26% of global consumption.

In this series, we’ll cover how costs in the United States, China, and Europe influence nitrogenous fertilizer prices along with other factors.

In its recent earnings call, Uralklali highlighted its new strategy, called the Revenue Maximization Strategy.

In this series, we’ll explore Mosaic Co.’s latest discussions on its third quarter 2013 earnings results and the industry outlook.

The Essential Fertilizers Weekly series comprises key factors that have a potential impact on the bottom line—depending on revenue and expenses.

The importance of the bottom line The performance of any investment over the medium to long term depends on current or future changes in the bottom line, like earnings per share, free cash flow per share, EBITDA (earnings before interest, tax, depreciation, and amortization) per share, and dividend per share. When the bottom line is […]

Main companies traded on the US market There are six main fertilizer producers that are widely traded on the US stock exchange: CF Industries Holdings Inc. (CF), Agrium Inc. (AGU), Mosaic Co. (MOS), Potash Corp. (POT), Terra Nitrogen Company LP (TNH) and Intrepid Potash Inc. (IPI). While they all operate producer fertilizers, each are exposed […]

Where potash is found Of all the fertilizer sub-industries, potash is the most concentrated. Mineral deposits of potash are more geographically concentrated than phosphate rock. Most of these resources are found in Canada, Russia, and Eastern Europe. Because of this, a large chunk of the world potash supply is controlled by companies like Potash Corp. […]

The phosphate industry is less competitive than the nitrogen industry Unlike nitrogen-based fertilizers, the production of phosphate and potash fertilizers begins in mines. Mineral deposits for the latter two fertilizers are much scarcer and are usually concentrated in specific regions around the world. Because of this, there are fewer firms that make up the two […]

Fertilizers are used in the agriculture industry to improve the yield farmers receive. The three main types of nutrients or fertilizers are nitrogen, phosphate, and potash.

As a critical part of economic and social welfare, agriculture is a key industry governments around the world support.

Introduction Most often, investors expect new capacity addition plans as a positive indicator of booming business. This is because companies often increase their capacity following a period of demand boom. But capacity increases can be negative, as we saw with several fiber optics companies back during the tech bubble, when earnings plummet on falling demand […]