Nutrien Ltd T.NTR

Alternate Symbol(s): NTR

Chemicals Basic Materials

Nutrien Ltd. is a Canada-based provider of crop inputs and services. The Company operates a network of production, distribution and ag retail facilities to serve the needs of growers. The Company operates through four segments: Nutrien Ag Solutions (Retail), Potash, Nitrogen and Phosphate. The Retail segment distributes crop nutrients, crop protection products, seed and merchandise. Its Retail provides services directly to growers through a network of farm centers in North America, South America and Australia. Its retail operations serve growers in seven countries across three continents. The Potash, Nitrogen and Phosphate segments are differentiated by the chemical nutrients contained in the products that each produces. The Company produces and distributes about 26 million tons of potash, nitrogen, and phosphate products for global agricultural, industrial, and feed customers. The Company’s agriculture retail network services over 500,000 grower accounts worldwide.

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Nutrien Ltd

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Post by retiredcfon Oct 02, 2023 8:32am

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Post# 35664593

TD Notes

Monthly Agriculture Update

Nitrogen Prices Up Notably M/M; Other Fert Prices Little Changed Crop Prices Mostly Lower M/M

Fertilizer Equities: Fertilizer equities exhibited mixed performance over the past month. On average, the peer group was flat m/m (NTR -1% m/m). Meanwhile, the S&P 500 and S&P/TSX were -4% and -3% m/m, respectively. Regarding valuation, performance was also mixed. On average, group member EV/FTM EBITDA multiples were flat 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 September 12) included only minor revisions to U.S. corn and soybean supply/ use estimates, while U.S. wheat estimates were unchanged. The USDA's forecast stocks-to-use ratio for U.S. soybeans continues to be low by historical standards, while expectations continue to call for U.S. corn and wheat stocks-to-use ratios to increase y/y.
Crop Prices: Crop prices were mostly lower over the past month. The price of U.S. soybeans declined 7% m/m after increasing in each of the prior three months, while U.S. wheat also traded down (-4% m/m). Meanwhile, the U.S. corn price was flat last month following m/m declines witnessed during the prior three-month period. U.S. crop prices have experienced pressure in recent months, driven in part by yields that have proven more resilient than some market participants were expecting, and more recently by harvest progress. Note, through the end of last week, 15% of U.S. corn was harvested (2% above the five-year average and 4% ahead of this time last year), while the U.S. soybean harvest was 12% complete (1% above the five-year average and 5% ahead of this time last year).
Fertilizer Markets: Regarding nitrogen prices, after giving back some previously seen gains in August, urea prices moved higher in September, aided in part by increased natural gas prices. NOLA urea was +16% m/m (although gains came in early-September) and U.S. Midwest urea was +21% m/m. Meanwhile, the Tampa ammonia price saw another significant move higher at the end of September (increased to $575/t from $390/t), supported by tight supply. Recall, this follows the 32% increase in Tampa ammonia seen at the end of August.
Regarding potash, after seeing price gains in the U.S. Midwest and Brazil in August, prices in these regions were down very slightly during September. That said, encouragingly, the SE Asia potash spot price (which had not shown the same evidence of firming as prices in other markets in recent months) moved up slightly last week (+2% w/w). Meanwhile, in terms of phosphate, the U.S. Gulf/Tampa price gained 3% m/m (follows August's 16% m/m gain).
With the North American harvest off to an early start, there is potential for a broad window for fall fertilizer application.