Mosaic, the world's top phosphate producer, raised its forecast for world shipments of the nutrient to a "record-shattering level" despite the shutdown on environmental grounds of one of its major mines.

The US fertilizer group lifted to 56m-57m tonnes, from 54m-56m tonnes, its forecast for phosphate shipments this year, raising its forecast for 2011 too.

"We expect the market momentum of the past several quarters to continue as distributors replenish depleted inventories and farmers invest in crop nutrients to rebuild... levels in their soils," said Jim Prokopanko, the Mosaic chief executive.

Longer-term, the need for "record" crop areas and increased yields to meet growing demand for grains and oilseeds implied "strong growth in global crop nutrient markets".

Indeed, Mosaic, which on its own reckoning is the world's second biggest producer of potash, narrowly ahead of Belarus's Belaruskali, raised its forecasts for that nutrient too.

'Supply uncertainties'

However, the growth in phosphate shipments will come despite the mothballing of the South Meade mine in Florida, after losing a legal battle against environmentalists attempting to protect the area's wetlands, and which has raised questions over Mosaic's permit for the site.

Mosaic confirmed that it had fully idled the site, which accounts for more than one-third of Mosaic's phosphate rock capacity, last month while pursuing a legal campaign to attempt to enable its reopening.

It was focusing on expanding other sites, drawing down on inventories, and making more of existing capacity to maintain phosphate supplies, and exploit the improved market conditions.

"Demand prospects remain robust and several supply uncertainties overhang the market in the near term. The global phosphate market is projected to remain tight until new capacity comes online," Mosaic said.

Besides the company's own South Meade hiccups, delays to the launch of the Saudi Arabian Ma'aden project have also dimmed prospects for phosphate supplies, and helped lift prices above $500 a tonne.

Earnings jump 

Mosaic's average phosphate selling price for the June-to-August quarter was $431 a tonne, up 55% year on year.

The surge helped lift the group's sales by 50% to $2.19bn in the period. Earnings near-tripled to $297.7m.

However, the earnings, equivalent to $0.67 a share, fell narrowly short of Wall Street forecasts of $0.70 a share.

Mosaic shares stood 2.5% higher at $60.27 in morning trade in New York.