Fertilizer Market Report – May 8, 2024


Global Nitrogen Market Moved to Long Supply Position

In this week’s fertilizer report:

  • CF Industries Quarterly Nitrogen Market Outlook supports Genesis Business Model
  • Weak Canadian Dollar Supports Genesis Business Model
  • Argus Media Update on Urea Markets – Caution and Confusion
  • Canadian Railway Workers Vote to Strike
  • North American Urea and MAP prices
  • Industry Tidbits

News of the Week 

CF Industries Nitrogen Market Outlook – Global Nitrogen Market Moved to Long Supply Position 

CF Industries recent outlook provides support to the Genesis Fertilizers business plan. This long supply position globally explained in this outlook will likely push urea prices down. The article mentions that the nitrogen cost curve will remain supportive of strong margin opportunities for low-cost North American producers.  

Genesis Fertilizers is expected to be on the lowest end of the cost curve in North America thus providing relatively firm margins in volatile pricing environments. 

CF Industries Holdings, Inc. Reports First Quarter 2024 Net Earnings of $194 Million, Adjusted EBITDA of $459 Million

Canadian Dollar Could Slip Below 70 Cents – TD Economics 

A few weeks back we had written about how the Bank of Canada cutting rates before the US Fed could cause more pain for the CAD $. This week, TD Economics wrote about the risk-off sentiment potentially outweighing oil price gains and thus pushing the CAD $ toward 70 cents.  

The Genesis Fertilizers business model mitigates this FX volatility with inputs in CAD $ and selling prices in CAD $, therefore no requirement to hedge the US $ therefore no risk of being offside on FX.  

Posthaste: Canadian dollar ‘caught in the crosshairs’ could slip below 70 cents (yahoo.com) 

Argus Media Update on Urea Markets – Caution and Confusion Regarding Direction of Urea Markets 

Argus media does a great job of explaining the recent volatility in global urea markets. The markets seemed to have been forming a bottom but supply increases in India helped the market turn over and weaken.  

Harry Minihan on LinkedIn: #urea | 11 comments 

Canadian Railway Workers Vote to Strike – This Could Put a Wrench in Grain and Fertilizer Movement 

Grain Growers of Canada calls on railways and workers to resolve their differences. A strike, especially at this point in the spring seeding season could wreak havoc on the ag sector. 

Railway strike vote dismays farmers | The Western Producer 

North America Urea Last Week   

According to Green Markets, urea prices in Western Canada were quoted in a range of C$775-$780/mt DEL, largely unchanged WoW. 

Last week, NOLA urea prices fell slightly to a range of US$285-$308/st from the previous week’s range of US$288-$315/st.   

We believe that urea prices in Western Canada are going to eventually correct to the downside. Our advice is sit and wait. 

North America Phosphate Last Week 

According to Green Markets, the latest delivered Western Canada MAP prices were flat WoW for the fourth week in a row in a range of C$1,135-$1,145/mt.  

MAP NOLA was flat WoW for the third week in a row in a range of US$480-$485/mt with limited trade reported. 

Industry Tidbits