Nutrien Ltd T.NTR

Alternate Symbol(s): NTR

Chemicals Basic Materials

Nutrien Ltd. is a Canada-based company, which is a provider of crop inputs and services. The Company operates through four segments: Nutrien Ag Solutions (Retail), Potash, Nitrogen and Phosphate. The Retail segment distributes crop nutrients, crop protection products, seeds and merchandise, and it provides services directly to growers through a network of farm centers in North America, South America and Australia. Its Retail business includes Nutrien Ag Solutions and Landmark Retail businesses, which provide agricultural solutions, including nutrients, crop protection products, seed, services and agronomic advice to growers. The Potash, Nitrogen and Phosphate segments are differentiated by the chemical nutrients contained in the products that it produces. The Company produces and distributes over 27 million tons of potash, nitrogen and phosphate products for agricultural, industrial and feed customers worldwide. It operates approximately 2,000 retail locations in over seven countries.

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Nutrien Ltd

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Post by retiredcfon Sep 01, 2023 8:52am

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Post# 35615529

TD Notes

Monthly Agriculture Update

Key Potash/Phosphate Prices Move Higher, Urea Pares Recent Gains Crop Prices Mixed M/M

Fertilizer Equities: Fertilizer equities were generally lower over the past month, giving back a portion of the strong gains realized in July. On average, the peer group was -5% m/m (NTR -7% m/m). Meanwhile, the S&P 500 and S&P/TSX were -2% and -1% m/m, respectively. Regarding valuation, group member EV/ FTM EBITDA multiples were mostly lower m/m (NTR -2%). We rate Nutrien as BUY, with a US$81.00 target price.
Agriculture Update: The USDA's most recent WASDE report (published August 11) included only relatively modest estimate revisions where U.S. corn, soybean, and wheat are concerned. Of note, although the U.S. soybean stocks-to-use ratio was already expected to be low by historical standards this year, it declined slightly m/m (now forecast to be 5.8% vs. 7.0% in July, which compares to 6.0% last year). Corn's forecast stocks-to-use ratio also fell slightly m/m, while wheat's increased modestly m/m.
Crop Prices: Crop prices were mixed over the past month. Soybeans gained for a third straight month (+4% m/m). However, corn and wheat both traded lower (-6% m/m and -9% m/m, respectively). Whereas U.S. crop prices exhibited a degree of strength in July on concerns over dry weather, by mid-August, improved crop soil moisture was observed in various U.S. growing regions. Regarding crop conditions, some improvements were observed through the first half of August, but the percentage of key crops (corn, soybeans, and wheat) rated as good or excellent by the USDA declined during the second half of the month.
Fertilizer Markets: Regarding potash, further evidence of an upturn in prices was observed over the past month. In Brazil, which was the first key market to see potash prices turn higher (i.e., began to increase in late-June after declining for more than a year), the spot price was up a further 4% in August (building on July's 5% gain). Moreover, notably, the U.S. Midwest spot price gained 12% in August. Potash prices in various other key markets (including SE Asia) were flat m/m. That said, industry consultant CRU this week reported that strong autumn demand and tighter supply have driven China's port wholesale potash prices up for two consecutive weeks. Meanwhile, the US Gulf/Tampa phosphate price gained 16% m/m (follows July's 4% decline).
Regarding nitrogen, after appreciating strongly in July, urea prices gave back some of their recent gains during seasonally slower August (NOLA urea down 6% m/m). Meanwhile, after ticking up slightly in late-July, the Tampa ammonia price was flat m/m. However, notably, it was recently reported that Yara and Mosaic agreed on a September Tampa ammonia price of $390/t CFR, which represents a 32% increase over August's $295/t CFR level.