Pakistan media report an end to the deadlock between Pakistan and Iran over a barter deal that includes urea shipments to Pakistan. The deal was hung up on Iran complaining about the price and quality of Pakistan wheat, but negotiators removed the last roadblock this past week.

Under the barter arrangement Pakistan will send Iran about 1 million mt of wheat at the prevailing international market price. In return, Iran will send iron ore and fertilizers.

The deal has been under discussion since February. The delay was put on Iran’s reservations about accepting any wheat with a fungal disease known as Karnal bunt.

In the end, Pakistan showed that its wheat has a 0.3 percent ration of the disease while international standards allow 1 percent. Iranian negotiators were insisting on zero percent.

No word yet on how many tons of fertilizers Iran will send.

Iran-Pakistan cross-border trade is pegged at US$10 billion. Other arrangements being negotiated include oil and natural gas pipelines and refineries to move Iranian petroleum products through Pakistani ports.

The Indian Ministry of Chemicals and Fertilizers released the May numbers for urea and DAP production and availability. May is the latest set of numbers available.

Urea production was pegged at 1.8 million mt against an anticipated 1.7 million mt. While urea showed a surplus over planned production, DAP output was almost half of what was expected. May 2012 DAP production was 188,000 mt as opposed to a targeted output of 400,000 mt.

The government report added that the country had a supply of 2.6 million mt of urea for May. According to the report that was more than enough to cover the local demand for urea.

All told the government claimed it had 1.1 million mt of DAP available for local farmers. The report called the supply on hand “adequate to meet the demand of the States.”

Citing increased fertilizer sales volumes and improved urea margins, Yara International ASA on July 18 reported second-quarter net income after non-controlling interests of NOK 2,800 million (NOK 9.86 per share), compared with NOK 2,225 million (NOK 7.73 per share) last year.

Excluding net foreign exchange gain and special items, the result was NOK 10.84 per share, compared with NOK 7.84 per share in second quarter 2011. Second-quarter EBITDA excluding special items was NOK 5,196 million, compared with NOK 3,540 million last year.

“Yara reports strong second-quarter results, reflecting a strong nitrogen fertilizer market and a significant increase in sales of Yara-produced fertilizer, especially outside Europe," said Jørgen Ole Haslestad, president and CEO. “Our value-added nitrate and NPK business continues to perform well, and we are also improving our commodity cost position with production growth in Pilbara and Qafco. With these initiatives, Yara’s gas and oil consumption outside Europe increases to almost 45 percent of the Yara total.”

Global Yara fertilizer deliveries were up 6 percent from second quarter 2011, while sales of Yara-produced fertilizer increased by 14 percent. Nitrate sales were up 13 percent from last year’s second quarter, reflecting increased sales in Europe and Latin America. Yara’s global energy costs declined 7 percent compared with second quarter last year.

Nitrogen fertilizer industry deliveries for the 2011/12 season in Western Europe were 10 percent lower than a year earlier, as cold and dry spring planting conditions impacted overall consumption. However, Yara said it continued to take advantage of its ability to export premium products to overseas markets and ended the season with European stocks below a year earlier.

Second-quarter nitrogen fertilizer deliveries in Europe were primarily for immediate consumption, Yara reported, but pre-buying incentives for the new season are stronger than a year ago given the recent strengthening of grain prices.

The Scott County, Iowa, Planning and Zoning Commission voted 6-1 on July 17 against the rezoning of 318 acres for Egypt’s Orascom Construction Industries (OCI) to build a $1.5 billion nitrogen plant. The Commission met before a standing-room only crowd, and some 50 people spoke for and against the plant, according to the local press. Per OCI’s approval, the plant will now go before the Scott County Board of Supervisors for a decision in August. A new venue that can accommodate a larger crowd is being sourced for that meeting. The site is currently agricultural and would be rezoned heavy industrial for the new plant.

Agrium Inc. said today that it expects its second quarter earnings to be in the range of $5.40 to $5.50 diluted earnings per share and the first half earnings to be in the range of $6.72 to $6.82 diluted earnings per share. The estimate excludes hedging gains or losses and share-based payments expense in our first quarter actual results and estimated second quarter results. This revised earnings estimate is approximately 15 percent higher than the previously announced second quarter guidance level and would represent a record earnings for the second quarter and the first half of the year.

“The increase in expected earnings is due to excellent results across our entire crop input business, resulting from the continuation of robust demand through June, despite the very early start to the spring season. As a result, the second quarter EBITDA for all three business units is expected to be higher than the same period last year. The outlook remains very positive, supported by the significant increase in grain and oilseed prices globally due to adverse weather in the U.S. and an expected tightening in international crop input markets. Detailed financials and more color on our results and the outlook for our business and sector will be provided in our second quarter financial results on Aug. 2, 2012,” said Mike Wilson, Agrium President and CEO.

The Mosaic Company reported fourth quarter fiscal 2012 net earnings of $507 million, compared to $649 million a year ago. Earnings per diluted share were $1.19 in the quarter compared to $1.45 last year. The year-over-year decline was primarily driven by lower phosphate pricing.

Mosaic’s net sales in the fourth quarter of fiscal 2012 were $2.8 billion, roughly flat with the same period last year, as growth in realized potash prices was offset by lower prices in phosphates.

“We completed a fiscal year of significant accomplishments with a strong fourth quarter,” said Jim Prokopanko, Mosaic president and CEO. “The extended spring season in North America, along with continuing strong demand for our products in Central and South America, led to solid financial results for the quarter. Despite challenging market conditions for much of the fiscal year, Mosaic made great progress. We improved our operating efficiency in both Potash and Phosphates, made substantial headway on our potash expansion projects, set new records for premium product sales and cash from operations, and, most important, our people delivered our best safety performance ever.”

Mosaic’s gross margin for the fourth quarter was $834 million, or 30 percent of net sales, compared to $995 million, or 35 percent of net sales, a year ago. Fourth-quarter operating earnings were $671 million, a decrease of 19 percent compared to $825 million a year ago. The decreases in gross margin and operating earnings were primarily driven by lower phosphate pricing.

Cash flow provided by operating activities in the fourth quarter of fiscal 2012 was $1.2 billion compared to $973 million in the prior year. The year-over-year improvement was primarily driven by decreased North American phosphate inventory and increased customer prepayments. Capital expenditures totaled $449 million in the quarter. Mosaic’s total cash and cash equivalents were $3.8 billion and long-term debt was $1.0 billion as of May 31, 2012.

Net sales in the Phosphates segment were $1.8 billion for the fourth quarter, down 5 percent compared to last year. Gross margin was $322 million, or 18 percent of net sales, compared to $479 million, or 25 percent of net sales, for the same period a year ago. The decline in net sales and gross margin was attributed to lower finished goods pricing. Operating earnings for the segment were $224 million for the quarter, down 39 percent compared to $370 million last year.

The fourth-quarter average DAP selling price FOB plant was $494/mt, compared to $574/mt a year ago. Phosphates segment total sales volumes were 2.9 million mt, compared to 2.8 million mt a year ago. Mosaic’s North American finished phosphate production was 2.1 million mt, or 86 percent of operational capacity, flat with the same period a year ago. Curtailments early in the quarter were offset by subsequent high operating rates as the market tightened through the 2012 quarter.

“Our Phosphates business ended the year on a strong note, with robust shipments worldwide,” Prokopanko said. “The phosphate market has tightened, as producer inventories dropped dramatically with global demand more than offsetting lower sales to India. While ammonia prices have increased, we expect these cost increases to be offset by higher finished product prices. As a result, we expect the gross margin percentage in the first quarter of 2013 to remain essentially unchanged from the prior quarter. Increased production at the South Fort Meade mine should benefit our rock costs later in the year.”

Net sales in the Potash segment totaled $1 billion for the fourth quarter, up six percent compared to $982 million a year ago, as higher realized prices were partially offset by a small decline in sales volume. Mosaic estimates sales volumes in the quarter were negatively impacted by approximately 100,000 mt