Top potash producer Nutrien misses first-quarter profit estimates on lower prices
Nutrien fell short of Wall Street expectations for first-quarter profit on Wednesday, as the top potash producer was impacted by lower prices and higher energy costs.
Trade tensions between the United States and China following US President Donald Trump's tariffs have led to volatility in crop prices over the past few months, prompting farmers to reign in costs, which in turn has hit demand for fertilizers.
Its quarterly net selling price for potash in North America fell 21.6% from a year earlier to $243/t, while adjusted core profit for the segment was down about 16% at $446-million.
Higher energy costs in its nitrogen segment further pressured earnings in the quarter, which raised its cost of goods sold by about 10% at $663-million.
Adjusted core profit fell about 12% to $408-million.
Average natural gas prices NGc1 have risen over the past few quarters and hit a two-year high on March 10, supported by strong demand from LNG export facilities and supply concerns in the run up to the summer season.
Nutrien's quarterly earnings were also impacted by delayed field activity due to wet weather conditions in North America and strategic actions in South America.
The company's quarterly sales for crop nutrients was down 8.7% at $1.19-billion, while sales for crop protection products was down 12.7% at $972-million.
Earlier this year, Nutrien's Brazilian unit said it would sell its fertilizer blending plants in the country amid a shift in focus to reselling farm inputs through local retailers after its acquisitions and investments failed to yield the expected returns.
The Saskatoon, Canada-based firm posted an adjusted profit of 11 cents per share for the quarter ended March 31, compared with the analysts' average estimate of 31 cents per share, according to data compiled by LSEG.
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