Yara Q3 net profits down 89% on weak margins, high potash prices

20 October 2009 09:13  [Source: ICIS news]

LONDON (ICIS news)--Norway's Yara reported third-quarter net income down 89% year on year on continued weak fertilizer margins and high potash prices, the company said on Tuesday.

Net income for the third quarter to 30 September was Norwegian kroner (NKr) 353m ($63.5m, €42.5m), down from NKr3.2bn in the same period last year, the fertilizer major said.

Revenues for the quarter were down 43% year on year at Nkr14.3bn.

"Our third-quarter results were non-satisfactory, mainly due to NPK [nitrogen phosphorus potassium] sales being hampered by high potash prices," said president and CEO Jorgen Ole Haslestad.

“However, fertilizer sales are picking up as pipeline effects come to an end and food demand growth remains robust. Farmers are increasing fertilizer purchases, but deliveries in Europe and North America continue to be subdued by distributors still unwilling to build inventories for the spring application,” he said.  

Yara had been able to gain market share by running all its available lower-cost gas-based nitrogen fertilizer production capacity in Europe, he added.

"NPK demand is expected to normalise when potash prices adjust to more sustainable levels. Until this happens, Yara will continue to curtail NPK capacity,” he said.

($1 = NKr5.56, €1 = NKr8.31)

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By: Staff Reporter
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