10 March 2009 16:47 [Source: ICIS news]
HOUSTON (ICIS news)--US fertilizer producer Mosaic on Tuesday predicted growth in fertilizer use in 2010 and beyond based on world population growth, rebounding from expected weak markets for potash and phosphates in 2009.
Speaking to investors at the Credit Suisse Global Ag Productivity Conference in London, Mosaic president and CEO Jim Prokopanko said production and sales of potash and phosphates would be down in 2009 due to weak demand resulting from unprecedented commodity price swings.
Prokopanko said prices will then increase in 2010 and beyond as the world population grows by an estimated 73m people annually.
“The price momentum in the [potash] business had been very strong until recent months when sales demand came to a halt,” Prokopanko said.
“We expect volume to decline in the current fiscal year due to continued weak demand. Longer term, we expect steady growth in potash volume due to our expansion plans and an increasing global demand for potash.”
Prokopanko said expansions at its mines in Saskatchewan in 2009 would increase Mosaic’s potash capacity by 5m tonnes/year from its present capacity of 71m tonnes/year.
Turning to phosphates, Prokopanko said price momentum had been strong until it came to “an abrupt halt and then reversed in the past few months”.
“Longer term, we look to sustain annual sales volumes in the 9m-9.5m tonne/year range,” Prokopanko said.
In his long-term outlook, Prokopanko reiterated that a leading driver for fertilizer markets would be the world population growth, particularly in China and India, where the middle class is projected to increase by 1.1bn by 2025.
“This would result in a systemic and lasting change in grain and oilseed demand that we have not previously experienced,” Prokopanko said. “One of the most immediate ways to grow more food is to increase yields through crop nutrition products.”
Minnesota-based Mosaic was the world’s largest producer of finished phosphate fertilizer in 2008 (71m tonnes/year) with a 59% production market share in North America and a 15% global share, the company said.
In addition, Mosaic was the world’s second-largest producer of potash (73m tonnes/year, trailing only Potash Corporation of Saskatchewan), with a 14% global market share and a 36% share in the US.
Mosaic traded at $43.08/share in mid-day trading on Tuesday on the New York Stock Exchange, up nearly 7% from the Monday close.For more on more on Mosaic visit ICIS company intelligence
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