16 September 2013 23:19 [Source: ICIS news]
HOUSTON (ICIS)--Mosaic is lowering its price and volume forecast for potash and phosphates for Q3 2013 due to cautiousness being expressed within the market and the resulting deferment of purchases, the North American fertilizer producer said on Monday.
Since Mosaic issued its third quarter guidance in early July, the markets, especially the potash segment, have experienced increased softness as a result of the turmoil created when the Belarusian Potash Company was terminated by partner Uralkali.
For potash, the company said its revised volume outlook is now between 1.45-1.65m tonnes, which it says properly reflects the lower near-term demand. Price expectations will now be placed in a range of $330-340/tonne (€248-255/tonne) with the gross margin rate anticipated to fall in the low- to mid-30% range.
The phosphate market is feeling the impact of the potash turmoil, Mosaic said, with buyers for this segment having adopted a wait-and-see approach with deferments of purchasing taking place. The company said the volume expectations are between 2.6-2.8m tonnes with realised prices coming in a range of $430-440/tonne. The gross margin rate is calculated to be in the mid-teens.
Even with this drawback in short-term expectations, Mosaic believes this is only a small obstacle to an overall solid outlook for the crop nutrients marketplace.
“The long-term positive outlook for crop nutrient demand has not changed. High commodity prices are driving record farm returns and making our products more affordable than ever before. These strong fundamentals are expected to drive near record global phosphate and potash shipments in calendar 2013,” said Jim Prokopanko, Mosaic president and CEO.
($1 = €0.75)
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