Mosaic misses profit estimates on lower fertilizer prices, Hurricane Ian damage
7:15 pm Monday, November 07th, 2022
By Ruhi Soni
(Reuters) – Mosaic Co on Monday became the latest fertilizer maker to miss third-quarter profit estimates, hurt by damage from Hurricane Ian and cooling prices of crop nutrients.
Prices of nutrients such as phosphates and potash have cooled from the near record highs they touched earlier this year as farmers cut back on fertilizer use to rein in costs.
Graphic: Fertilizer prices tapered from dizzying highs https://graphics.reuters.com/FERTILIZERS-PRICES/zdvxdybrrvx/chart.png
Rivals Nutrien Ltd, CF Industries Holdings Inc and Intrepid Potash Inc missed quarterly profit estimates last week, with top fertilizer maker Nutrien also cutting its full-year earnings forecast.
Mosaic, the world’s largest producer of finished phosphate products, saw a 4% drop in production and 10% drop in sales volumes of phosphates as its Tampa, Florida-based operations were damaged by Hurricane Ian as well as resulting rail and port closures.
Adjusted earnings in its potash segment more than tripled to $871 million, but earnings in its phosphate segment were flat.
The company, however, echoed its rivals in expecting tight global grain stocks through 2023, as supply is yet to recover since crop shipments from Ukraine, the “breadbasket of the Black Sea”, remain largely blocked.
Before Russia’s invasion of Ukraine, both countries together accounted for nearly 30% of global wheat exports. Ukraine was also a major supplier of corn and sunflower oil.
“The disruption to Ukraine’s agricultural production caused by war, coupled with poor growing conditions in several major growing regions like the Americas, Europe and China, have resulted in lower global agricultural production,” Mosaic said in a statement.
Mosaic’s net income more than doubled to $841.7 million, or $2.42 a share, in the three months ended Sept. 30.
Excluding items, however, the company earned $3.22 a share, missing Wall Street consensus of $3.40 as per Refinitiv data.
Net sales of $5.35 billion also fell short of expectations of $5.79 billion.
(Reporting by Ruhi Soni in Bengaluru; Editing by Krishna Chandra Eluri)
