North American producer Nutrien sees a bleak future for phosphate producers, adjusting lower the estimated value of its primary US phosphate assets as a result.
It wrote down by a combined $760mn the value of its US phosphate plants at Aurora and White Springs after revising its forecasts for long-term phosphate prices. It describes the market as "fundamentally oversupplied" and said this could limit price appreciation for years.
White Springs will exhaust its reserves by 2029, with Aurora expected to run until 2050.
Nutrien produced 354,000t of P2O5 of phosphate products in the third quarter, down by 5pc on last year.
Nutrien expects in the short term that firmer farm economics and broad application windows in the Americas will support fertilizer demand. US farmers harvested earlier than normal this year, giving an extended period of time for fall ammonia, phosphates and potash applications.
A similarly wide window in Brazil has largely offset delays to summer soybean planting. Farmers, encouraged by higher crop prices, are expected to plant large soybean and safrinha corn crops in the new year.
Nitrogen hampered by industrial demand
Nutrien's nitrogen sales continued to be affected by Covid-19's impact on the industrial market.
Industrial and feed grade nitrogen sales were lower by 20pc than a year earlier at 977,000t in the third quarter. Most of the reduction was felt in ammonia, sales of which fell by 24pc to 546,000t.
But urea sales rose by 6pc to 766,000t, while UAN and amsul sales were little changed at 1.09mn t combined.
