Fertilizer price slump chops profits at CF Industries, Agrium
By Rod Nickel
Aug 3 (Reuters) - Two of North America's biggest fertilizer companies reported large drops in quarterly profit on Wednesday, and warned of tough times ahead as abundant supplies weighed on prices.
At U.S. nitrogen producer CF Industries Holdings Inc, second-quarter profit fell 87 percent - more than expected - and it warned that prices would likely remain weak into next year.
Canada's Agrium Inc recorded a 16 percent profit drop, as its farm retail business softened the blow of weak nitrogen and potash prices, but it lowered its profit guidance for the year.
Nitrogen prices have been pressured by China's growing exports of urea and new capacity coming on stream in North America. CF's expanded plants in Louisiana and Iowa may start producing in the current, third quarter, the company said.
CF shares dipped 5 percent after normal trading hours on the New York Stock Exchange, while Agrium was unchanged.
CF Chief Executive Tony Will said the company would suspend share buybacks and allow its current authorization to expire in December.
Net earnings for CF's second quarter fell to $47 million, or 20 cents per share, from $352 million, or $1.49 per share, a year earlier.
Excluding items, it earned 33 cents per share, lower than average analysts' estimates of 68 cents, according to Thomson Reuters I/B/E/S. Continued...