RSS
Twitter
Linked In
News In
News
Linked In
RSS
https://twitter.com/Agrimoney
http://www.newsnow.co.uk/h/Industry+Sectors/Agriculture

You are viewing 1 of your 2 complimentary articles.

Register now to receive full access.

Already registered?

Login | Join us now

PotashCorp trims profit forecast as nitrogen sales fall

Twitter Linkedin

Fertilizer giant PotashCorp has lowered its 2015 profit expectations, despite stable global potash demand, as nitrogen prices retreat.

The world's biggest fertilizer group by market capitalization trimmed full year profit expectations to $1.95 to $1.75 a share, from $2.05 to $1.75 a share, as the company's profits fell on weaker nitrogen sales.

The company narrowed its potash sales forecast for 2015 to 9.3 to 9.6m tonnes from 9.2 to 9.7m tonnes, as rising demand in China cancelled out falling expectation in the Americas.

Falling profits

The group's profits fell 12% $417m, or 50 cents a share, in the three months to June 30, down from $472m over the same period last year, falling short of analysts' estimates of 51 cents a share.

Potash Corp's nitrogen segment saw sales fall 2% to 1.6m tonnes in the three months to June 30, while average realized nitrogen price fell 15% to $334 per tonne.

However earnings from the group's core potash segment edged up, as potash production remained flat at 2.5m tonnes compared to the same time last year, while average realized potash price rose 4% to $273 per tonne, and profits in the segment also grew, as gross margin jumped 6%.

Total group revenues fell 9% to $1.731bn, down from $1.892bn over the same period last year, falling short of analysts' estimates of $1.890bn.

Stable demand

PotashCorp left expectations for full-year 2015 global potash demand unchanged at 60m tonnes, as falling demand in the Americas was cancelled out by rising shipments to China.

PotashCorp expects shipments to North America to accelerate over the rest of 2015, but still revised down its forecast for total 2015 shipments to 9.0 to 9.5m tonnes, compared to the 9.3 to 9.8m tonnes forecast in April.

PotashCorp also lowered its forecast for Latin American potash demand, citing "reduced credit availability and currency weakness in Brazil".

The group saw full year Latin American potash demand at 10.6 to 11.1m tonnes, from 10.8 to 11.3m tonnes forecast in April.

Encouraging trends

But PotashCorp noted "encouraging consumption trends" in China, as it revised upward its estimates for Chinese total demand.

Canpotex, the potash marketing cartel of which PotashCorp is the largest component, is contracted to ship at least 1.8m tonnes of potash to China this year, but the group sees "rising demand in China for compound fertilizers and bulk blends with higher potassium content" pushing Canpotex sales volumes above the lower bound.

The group revised its forecasts for 2015 Chinese demand up to 14.2 to 14.7m tonnes, from the 14.0 to 14.5m tonnes forecast in April.

Robust demand

PotashCorp noted "robust demand for direct application and compound fertilizers" in India as well, while maintaining a full year potash demand forecast of 4.5 to 5.0m tonnes.

For the rest of Asia, PotashCorp maintained a combined demand forecast of 8.4 to 8.8m tonnes, but warned that "significant competitive pressures and currency volatility could weigh on prices in these markets through the balance of the year".

On Wednesday US group Intrepid Potash said that the recent easing potash prices was coming to an end, as its chief executive told investors that "we are getting very close to a floor".

By Agrimoney.com

Twitter Linkedin
Related Stories

Festive staff shortages 'likely' as British growers cut ties with UK supermarkets

Faced with mounting concerns over labour shortages and fears they may not be able to fulfil retailer contracts, some British growers have sought to cut ties with UK supermarkets in favour of companies elsewhere in Europe.

Hard Brexit to have 'catastrophic' effect on European meat industry; new report

A hard Brexit will have a ‘catastrophic impact’ on the European meat industry, according to a report published by Europe’s meat industry body, UECBV, as the UK and EU continue negotiations.

Manufacturers stockpile agrochemicals in bid to keep post-Brexit prices down for farmers

Manufacturers of crop protection products are stockpiling agrochemicals in warehouses in a bid to keep input costs down for farmers after Brexit, according to the chief executive of the Crop Protection Association, Sarah Mukherjee.

Dairy groups sidestep shockwaves from GDT price slump

Indeed, shares in the likes of A2 and Beston soar. Still, that does not mean there are no losers from the dairy price falls...
Home | About | RSS | Commodities | Companies | Markets | Legal disclaimer | Privacy policy | Contact

Our Brands: Comtell | Feedinfo | FGInsight

© Agrimoney.com 2017

Agrimoney.com and Agrimoney are trademarks of Agrimoney Ltd
Agrimoney is part of the Briefing Media group
Agrimoney Ltd is registered in England & Wales. Registered number: 09239069