Fertilizer Maker Mosaic Plummets as Hurricanes Dent Profit

(Bloomberg) -- Shares of fertilizer producer Mosaic Co. fell the most in over a year after multiple US hurricanes and lower selling prices led to sharply lower-than-expected profit and sales.

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The stock closed down 7.7% at $25.86 for the steepest daily drop May 4, 2023. Shares have plunged about 28% this year, putting the stock on track for its worst annual performance since 2015.

Three back-to-back hurricanes took a toll on Mosaic’s phosphate production in the Tampa, Florida, area during the third quarter as lower product prices also hurt results. Revenue slumped 21% to $2.8 billion from a year earlier. The decline follows several years of heightened volatility in the fertilizer market amid war in Eastern Europe and stressed global supply chains.

Mosaic’s setback is in contrast with rivals like CF Industries Holdings Inc., which posted higher-than-forecast profit over the same three-month period.

While the logistical and production problems due to the massive storms were known, the magnitude was worse than expected, according to Ben Isaacson, a Scotiabank analyst who has a sector perform rating on the stock.

Mosaic’s phosphate production has returned to full operating capacity and is on track to reach its target yearly run rate by the year’s end, the company said in a statement.

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