By continuing to use this site, you agree to our use of cookies.

Japan

In Japan? You can go to Argus Japan

X

Nutrien expects record potash demand in 2018

6 Feb 2018, 8.39 pm GMT

Nutrien expects record potash demand in 2018

Houston, 6 February (Argus) — Canada-based producer Nutrien expects record potash demand in 2018 as the newly formed company moves forward in optimizing its combined assets.

Nutrien said that affordability and depleted soil nutrient levels will lead to global potash demand of 64mn-66mn tonnes in 2018, up from the record 64mn t estimated in 2017. The company expects its potash sales volumes to grow by 100,000-600,000t in 2018 to 11.8mn-12.4mn t. Nutrien is already committed on volumes for the first quarter, following a strong winter fill program in the US.

Stout global demand lifted MOP prices, but PotashCorp and Agrium--which combined to form Nutrien in January 2018--combined to produce and sell less during the fourth quarter.

The companies combined to produce 3.08mn t of potash during the quarter, down by 3pc from the previous year. PotashCorp's output was limited by temporary shutdowns at its Lanigan and Allen facilities in Saskatchewan. Agrium production increased slightly year-over-year to 663,000t.

Combined potash sales volumes for the fourth quarter dropped by 10pc year-over-year to 2.5mn t. After heavy third quarter sales, North American sales volumes fell by 9pc from a year ago to 897,000t. Combined international sales volumes dropped by 2pc year-over-year to 1.6mn t.

Nutrien said that it will move to manage its expanded potash network in the most cost-effective way possible by reducing its warehouse footprint and rail fleet as well as shifting more production to its low-cost mines. The company intends to push production out of Rocanville to 6mn t/yr, a 1mn t increase from its current operational capacity.

In phosphates, Nutrien is analyzing the best way to deliver intended $80mn in synergies while trying to supply a captive demand channel of 280 retail outlets in western Canada. Nutrien wants to eliminate the use of third-party phosphate rock providers and utilize its deposits in North Carolina and Florida. It said the most cost-effective scenario to-date is to ship finished MAP fertilizer from the southeastern US into western Canada and repurpose the Redwater phosphate facility in Alberta.

Elevated input costs and changes in production schedules created fourth quarter losses in the phosphate segment of both companies.

Total sales volumes for the fourth quarter were up by 24pc from last year to 1.4mn t amid increased demand. PotashCorp P2O5 production in fourth quarter totaled 437,000t, up by 10pc year-over-year as operating rates were up by six percentage points from a year ago to 91pc. PotashCorp reported an average realized sale prices for all phosphates at $385/t during the quarter, a $19/t decline from last year. Feed/industrial prices dropped to $483/t, down from the $551/t a year ago and offsetting the $14/t year-over-year rise in fertilizer prices to $342/t. The cost of goods per ton rose by $362/t from the prior year to $782/t as the company accrued a non-cash impairment charge of $276mn related to the White Springs, Florida, and other feed phosphate plants.

5335271

View more news articles

Share this page

Contact Us

Request a callback

I agree to the Argus privacy policy