News

October 09, 2008

Farmers Breathe Easier With End In Sight To Rising Fertiliser Prices

By Sally White

Shares of fertiliser companies are wilting. Prices falls of 30 per cent and more have been seen since Merrill Lynch and other US brokers slashed forecasts last week. This was put down to US sector major, potash producer Mosaic, coming out with less brilliant figures than expected. Mosaic merely tripled net earnings on doubled sales, while the analysts were going for US$2.94 a share and not the US$2.65 they were given. Even before then, however, fertiliser markets have been losing their fizz.

Tumbling down have come the shares of  Agrium, CF Industries, Potash as well as Mosaic – it fell by over 40 per cent - in the US, and the London quoted GDR’s of Russia’s Uralkali. Potash Corp was left down 60 per cent from its peak. The stocks have fallen from favour, or from the funds of distressed sellers, despite the fact that all are reporting record profits. The analysts got very rough – Goldman axed its six month price target on Mosaic by US$35 to US$115 and pulled it from its...