Agrium raises profit view, shares jump
WINNIPEG, Manitoba (Reuters) - Shares of Agrium Inc, a Canadian-based farm-products retailer and potash miner, jumped on Monday after it raised its second-quarter earnings outlook, citing strong retail sales and higher nutrient prices.
The company's shares rose more than 3 percent in early trading in New York and Toronto, even as many U.S. stocks fell at the open as investors pulled out of riskier assets.
Shares of fellow fertilizer producers Mosaic Co and Potash Corp of Saskatchewan were also higher, but their gains lagged Agrium's climb.
Agrium, the largest North American farm products retailer, said on Sunday it now expects to earn $4.10 to $4.40 per share in the quarter, up from its previous view of $3.38 to $3.88.
"Record global crop prices are driving demand for all crop inputs," Agrium Chief Executive Mike Wilson said.
Prices of corn, a crop that requires much fertilizer, hit a record high this month on tight supplies and concerns about poor U.S. planting weather.
Despite planting problems, U.S. farmers managed to seed a large corn crop, which bodes well for Agrium's retail sales, said Gleacher & Co analyst Edlain Rodriguez.
"I don't think (raising guidance) is surprising," he said. "Farmers did end up planting all the corn they needed."
The U.S. Senate voted last week to eliminate subsidies for the U.S. ethanol industry, which added to a steep fall in the price of corn because it is used to make the fuel. Continued...