Potash Corp of Saskatchewan Inc

Phosphate fertilizer prices are key to Mosaic’s (MOS) Phosphate segment’s sales, earnings, and stock price.

In 2013, about 54% of global ammonia was upgraded to urea, according to FERTECON. But urea prices have rebounded from their lows at the beginning of 2016.

For the week ending October 28, the overall movement in urea prices was flat to positive. Granular urea prices rose 6.6% to $211 per metric ton in China.

Last week, potash prices continued to show weakness week-over-week. Prices were broadly flat to positive for the week ending April 21.

Of the 22 analysts surveyed, about 32% of them gave Mosaic (MOS) a “buy” rating. About 41% of analysts issued a “hold” rating, and only 27% issued a “sell” rating.

The significance of potash price Wholesale potash price is one of two factors (the other being sales volume) that influence potash producers’ revenues. When prices rise, so does revenue, which will translate to higher profitability (margins), earnings, and share prices. However, when prices fall, they will have a negative impact on fundamentals and share prices. […]

After a year of declining sales and increasing costs, management seems much more optimistic regarding potash as well as Langbeinite.

The week ending March 24, 2017, was broadly negative for agricultural fertilizer stocks. The VanEck Vectors Agribusiness ETF (MOO) fell 0.98%.

In the last 12 months, PotashCorp (POT) has earned about 36% of its total sales from its Potash segment.

Last week was mostly negative for agricultural fertilizer (FXZ) stocks. However, the VanEck Vectors Agribusiness ETF (MOO) ended the week in positive territory.

According to CF Industries, nitrogen prices could remain under pressure as new capacities come online in 2017. However, the company believes that things should improve in 2018.

As crops widely trade in the international market, they often converge with each other if transportation costs aren’t so high.

Generally, a capacity increase tends to lag demand growth, as producers like to see a stronger market before making significant investments.

Since the beginning of 2016, analysts have revised their next-12-month price target for PotashCorp downward. The consensus price target now stands at $15.70.

Average DAP prices in China were flat at 2,669 Chinese yuan per metric ton last week. DAP prices in Morocco remained unchanged at $340 per metric ton.

Like Monsanto (MON), FMC Corporation (FMC) is in the business of crop protection products. The majority of FMC’s sales come from its Agricultural Solutions segment.

CF Industries (CF) is expected to see a significant reduction in its capital expenditure (or capex) year-over-year (or YoY) in 2Q17 and for the next four quarters.

Mosaic (MOS) and PotashCorp (POT) were hit the hardest, with their respective shipments declining by 24% each to 1.5 million tons and 1.7 million tons year-over-year.

Potash fertilizers Most of the fertilizer companies we’ve discussed in this series sell all or some of the three NPK (nitrogen, phosphorous, and potassium) macronutrients. To learn more about these macronutrients’ key role in agriculture, read Agricultural Fertilizer Industry: Your Comprehensive Overview. In this part, we’ll look at what 2017 meant for potash producers. Price trends […]

On September 12, 2016, PotashCorp and Agrium announced their intention to combine in a merger of equals. But China and India have set conditions.

According to the Fertilizer Affordability Index, 2017 has been one of the most affordable years for fertilizers. Mosaic issues the index.

Over the past ten-year period, CF Industries has risen 186.0% and significantly outperformed the S&P 500 Index’s rise of 69.2% over the same period.

The average weekly price of MOP (muriate of potash) in Vancouver remained unchanged for the week ended May 20, 2016.

On average, potash prices for these five producers fell ~33% YoY in 4Q16. Excess supply and weak demand added downward pressure.

When we look at the past five quarters, we see that PotashCorp has missed all its earnings estimates.

CF Industries’ (CF) sales segment includes UAN (urea ammonia nitrate), AN (ammonia nitrate), ammonia, and granular urea.

The MAP (monoammonium phosphate) prices in Brazil saw positive momentum last week. Brazil is still a favorable market for fertilizer producers.

As of December 25, 2017, Monsanto stock was covered by 18 analysts according to Reuters. The current consensus rating on the stock stood at 2.56.

Last week, MAP (monoammonium phosphate) prices continued to fall and brought more pain for phosphate producers (NANR).

On March 13, 2017, five of the 18 analysts covering CF Industries (CF) recommended a “strong buy” to a “buy” for the next 12 months, down from six analysts in February.

China is the largest consumer of nitrogen fertilizers, but it produces most of it within its borders. Urea is Chinese farmers’ top choice.

The average weekly price of MOP (muriate of potash) at Vancouver has been flat since the beginning of March.

For the week ending April 28, the Fertilizer Affordability Index fell slightly to 0.58x—compared to 0.59x the previous week.

Mosaic (MOS) continued to enjoy higher margins at 7%—compared to Agrium’s (AGU) margins at 5%. Mosaic’s margins were flat year-over-year.

The median gross margin for these companies’ phosphate segments was 14%, as a percentage of segment sales in 4Q15.

The weekly average price for potash in Vancouver remained flat in the week ended June 24, 2016. Prices are below their 15-year average of $290 per metric ton.

Without an understanding of factors that affect crop prices, it would be difficult to formulate a view on future crop prices and demand for nitrogenous fertilizers.

MAP (monoammonium phosphate) prices hit a low of $343 per metric ton in August but have been on an upward momentum since then.

Analyst recommendations for Scotts Miracle-Gro (SMG) have trended with earnings estimates, with more analysts recommending a “buy” for the stock.

Last week, the MAP prices in Brazil rose as much as 5.6% week-over-week to $394 per metric ton from $373 per metric ton a week ago.

There’s a handful of big players in the agricultural fertilizer industry. Setting up business requires huge capital, which makes for a high barrier to entry.

Potash prices over the past few years have been considerably lower than what we saw during their peaks of ~$482 in 2011 and ~$870 in 2009.

On August 13, the crop index stood at 89.9. It rose by 1% following the USDA’s latest stock-to-use ratio, which was published on August 12.

Mosaic (MOS), which has historically traded at a high valuation multiple of 9.2x, is currently trading at an enterprise value to next 12-month EBITDA ratio of 5.7x.

Potash prices in the Corn Belt region of the United States appear to still be reversing their downward movement.

Intrepid Potash (IPI) is nearing $1 per share, which means that only a few analysts are covering the stock.

The Fertilizer Affordability Index kept trending lower last week, continuing its two-week streak.

Potash stocks struggled for most of 2016. In 1H16, potash demand was negatively affected due to delays in potash contract settlements in China and India.

On average, granular urea prices were flat to positive week-over-week. In NOLA (New Orleans), granular urea prices rose as much as 3.5% week-over-week.

Bayer recently filed for an extension with European Union regulators, which pushed back the merger with Monsanto to early 2018.