WINNIPEG -- Nutrien is struggling from fertilizer production challenges affecting the industry globally, posting quarterly earnings below analyst estimates as a slump in nitrogen fertilizer sales and increased sulfur and other production costs drag on profitability.
The world’s largest potash producer reported on Thursday third-quarter earnings of 61 cents per share compared to expectations of 80 cents a share.
In its results conference call, the Saskatoon-based company said it is seeing financially squeezed farmers, especially in Brazil, putting off nitrogen fertilizer purchases, but global demand remaining high for potash, its main product.
It expects U.S. farmers to catch up with their fall fertilizer applications in coming weeks due to better recent weather and the need to replenish soils drained by this year’s crop.
The company will close its Florida phosphate fertilizer mine and processing in the first half of 2027 due to poor profitability and depleting reserves, and has now finished closing its Trinidad nitrogen fertilizer plant due to unsure natural gas supply and issues with port charges.
It is retaining and reinvesting in its more efficient Aurora, North Carolina phosphate mine and complex, which it had also been considering selling. President and Chief Executive Ken Seitz said that having production located in North America is an advantage over producers in regions like Europe, which have far higher natural gas costs.
“The competitive advantages are extraordinary,” Seitz said. “That gives us the confidence to invest, that gives us the confidence to unlock” more production.
Despite high prices for nitrogen and phosphate fertilizers, high natural gas and sulfur prices have constrained margins for those products, spurring some companies to reduce production.
Nutrien attributed falling nitrogen fertilizer and other product sales in Brazil to farmers running low on credit. The company expects Chinese demand to remain firm to ensure food security.
(Reporting by Ed White and Khusbu Jena; Editing by Susan Fenton)
