US Mosaic aiming for 60% increase in potash production

05 January 2012 15:44  [Source: ICIS news]

HOUSTON (ICIS)--US-based fertilizer maker Mosaic expects to increase its potash capacity by more than 60% by 2019, chief executive Jim Prokopanko said on Thursday.

"Four brownfield mine expansion projects underway in Saskatchewan will boost potash production to 16.5m tonnes in 2013, up from 10.3m tonnes in 2011," Prokopanko said in a conference call with investors.

Mosaic forecast that global potash shipments from all producers will total 57m-59m tonnes in 2012, up from an estimated 56m tonnes shipped in 2011.

Mosaic, the world's leading producer of phosphate fertilizers, said global phosphate shipments are forecast to be a record 62m64m tonnes in 2012, up from a record 60m tonnes shipped in 2011.

"Strong markets for corn and oilseeds are signalling farmers to keep their foot on the production gas pedal," Prokopanko said.

Mosaic reported on Wednesday second quarter fiscal 2012 net earnings of $624m (€480m), an increase of 37% from the same period a year earlier.

For the quarter ended 31 December, Mosaic reported net sales of $3bn, a 13% increase from $2.7bn in the same period a year earlier.

The increased sales were driven by improved pricing that was partially offset by lower volumes, the company said.

In the near term, Mosaic estimated that its potash sales volumes will range from 1.2m1.5m tonnes for the third quarter of fiscal 2012 with prices ranging $430460/tonne FOB (free on board) plant.

Third quarter phosphate sales are expected to range from 2.2m2.6m tonnes with an estimated price range of $530560/tonne FOB (free on board) plant.

Mosaic acknowledged that sales of fertilizers in the US for the third quarter would get off to a slow start as distributors, dealers and farmers delayed purchases for spring application as the price of corn dipped in December.

"While we expect third quarter results to decline due to near-term macroeconomic uncertainty and cautious distributor purchasing behaviour, we remain confident of the strong long-term demand prospects for our products," said Prokopanko.

($1 = €0.77)

By: Frank Zaworski
+1 713 525 2653

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