Yara International ASA reported first-quarter net income after non-controlling interests of NOK 1,773 million (NOK 6.40 per share), compared with NOK 2,257 million (NOK 8.04 per share) a year earlier. Revenues were up, at NOK 21,709 million from the year-ago NOK 20,690 million.
"Yara reports a strong first-quarter result reflecting record deliveries," said Jørgen Ole Haslestad, Yara president and CEO. "While global commodity nitrogen markets have been impacted by increased export supply from China, healthy demand in both Europe and Latin America has supported value-added premiums and generated a strong Yara performance.”
Global Yara fertilizer deliveries were up 21 percent, to 6.4 million mt from the year-ago 5.3 million mt, reflecting both strong demand for most products in all markets as well as the acquisition of Bunge assets in Brazil. Excluding volumes to Brazil, global Yara fertilizer deliveries were up 11 percent compared with first quarter 2013.
Yara’s average realized urea prices were 13 percent lower than a year ago. Realized nitrate and NPK compound prices decreased by 12 percent and 10 percent, respectively, keeping premiums over urea and other commodity fertilizers stable overall, while NPK blend margins in Brazil were higher than last year.
Although an early spring in Europe pulled ahead some demand from second to first quarter, Yara said strong farm margins and tight supply for nitrates in particular indicate a positive European nitrogen market situation also for the second quarter. Yara said it has a strong European order book for the remainder of the season, and is also positively impacted by lower European gas prices, which are expected to continue based on forward markets.
The largest fertilizer volume uptick was for NPKs, which saw a 45 percent increase, to 2.33 million mt from 1.61 million mt. Other major nitrogens with increases were nitrate at 1.74 million mt, up from 1.65 million mt, UAN at 418,000 mt versus 316,000 mt, and CN at 353,000 mt versus 332,000 mt. Those dropping in volumes were ammonia at 650,000 mt from 869,000 mt and urea to 1.55 million mt from 1.61 million mt.
Yara said its ammonia production was off 6 percent during the quarter and cited a mid-January fire at Tertre, as well as the Libyan Lifeco plant going down around the same time due to a militia blocking access to the site. Lifeco just recently returned to production. Qafco production was also down due to a scheduled turnaround.