Nutrien sees demand growth cooling, margins shrinking

(Staff photo)

Reuters — Nutrien, the Canadian fertilizer and farm supply dealer created from the merger of Agrium and PotashCorp this year, said it expected demand growth for potash in China and India to cool down in 2018.

Nutrien, the world’s biggest fertilizer company by capacity, also said higher input costs would shrink nitrogen and phosphate margins.

The company, reporting its first results since the merger, said it expects full-year earnings before interest, taxes, depreciation and amortization of $3.2 billion to $3.7 billion, and earnings per share of between $2.10 and $2.60 (all figures US$).

CEO Chuck Magro said that following the merger, the company achieved $40 million in run-rate synergies and was “focused on capturing half a billion dollars” in annual merger synergies by the end of 2019.

The acquisition of Brazil’s Agrichem in January would help Nutrien gain foothold in the country, which is seen as a driver of crop prices in the coming months.

Nutrien said fourth-quarter net earnings for Agrium fell to $18 million, or 13 cents per share, from $67 million, or 49 cents per share, a year earlier.

PotashCorp reported a net loss from continuing operations of $120 million, or 14 cents per share, from a profit of $13 million, or two cents per share, a year earlier.

Agrium’s total sales rose 9.5 per cent to $2.45 billion, while PotashCorp’s sales were up two per cent at $1.08 billion.

Reporting for Reuters by Karan Nagarkatti in Bangalore.

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