The Mosaic Company
Materials · Fertilizers & Agricultural Chemicals
Structural: phosphate + potash are concentrated global oligopolies - top 5 producers control ~70% of seaborne potash and phosphate trade. Mosaic is the largest North American phosphate producer and a top-3 potash producer alongside $NTR (Nutrien) and Belaruskali.
Brazil distribution gives it a captive channel into the world's #1 fertilizer-importing ag economy. Earnings track a (corn/soy prices) x (input cost ammonia + sulfur + nat gas) x (China/Russia export policy) cycle.
(1) phosphate market structurally tight - China export curbs on DAP/MAP since 2021 + Morocco/$OCP capacity discipline holding the floor; (2) Brazil ag expansion (safrinha corn, soy frontier) is the highest-growth fertilizer demand corridor and Mosaic owns the distribution; (3) potash supply still constrained by Belarus sanctions overhang + slow brownfield ramps; (4) sub-replacement nutrient application 2023-2024 builds soil-deficit demand pent-up for 2026+; (5) capital return - buybacks + dividend at trough multiples; (6) Ma'aden JV scales low-cost phosphate exposure.
(1) deeply cyclical - fertilizer prices off 2022 war highs; potash spot < $300/t vs $1,100 peak; (2) farmer affordability stressed as corn/soy prices fade, demand elasticity bites; (3) China DAP/MAP export quotas can reopen and crater phos pricing overnight (happened H2 2024); (4) Florida phosphate has legacy gypstack/environmental liabilities + permitting risk; (5) BRL/USD a recurring earnings drag on Fertilizantes segment; (6) Belarusian/Russian potash slowly normalizing back into seaborne trade; (7) capex on Ma'aden + Brazil weighs on near-term FCF.
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