Canadian company Nutrien in its annual report attributes the increase in potash prices in the fourth quarter to the uncertainty of sanctions against Belarus. It does not expect that the cessation of transit of Belarusian fertilizers through Lithuania will have a long-term impact on the market.
“Net realizable value increased in the fourth quarter and in 2021 due to strong global demand supported by higher crop prices, the impact on global supply caused by competitor disruptions and project delays, and uncertainty about future sanctions on Belarus,” the report says.
Nutrien estimates global demand for potash fertilizers in 2021 at a record 70 million tons. The company believes that many of the supply problems will remain in 2022, with the addition of restrictions on the transit of Belarusian potash through Lithuania. The global demand for potash fertilizers in 2022 is estimated at 68-71 million tons.
Компания не считает, что прекращение транзита беларусского калия через Литву окажет долгосрочное влияние на рынок.
“Nutrien expects record potash sales of 13.7 to 14.3 million tons in 2022. This forecast assumes that sanctions on Belarus will have a temporary impact on global supplies. If there was a more significant long-term impact on global supplies, Nutrien would have the opportunity to further increase production by hiring additional employees and incurring small additional capital expenditures,” the report says.
In 2022, the company increased its revenues from the sale of potash fertilizers by 88% to $4.04 billion. Sales volumes were up 6% to 13.6 million tons. Average realized price went up 77% to $296 per ton on a year-on-year basis. In the fourth quarter, it rose 2.7 times to $465 per ton compared to the same period in 2020.
Nutrien also recorded record sales of potash fertilizers, both in North America and other markets. Outside North America, Latin America accounted for 38% of sales, China – 11%, India – 6% and other Asian markets – 35%. Nutrien trader Canpotex has reduced the share of China and India in its sales by two or more times, but the share of other Asian markets has increased by 1.5 times.
The company’s total revenue in 2021 rose by 33% to $27.7 billion. Its net income increased sevenfold to $3.18 billion.