All Posts from March 31, 2015

Sask. tax change to impact Mosaic – Alert

The Mosaic Co. said March 30 that the expected impact from the recent changes in Saskatchewan’s Potash Production Tax (CRT) calculation will increase the company’s 2015 CRT pre-tax payments by $80-$100 million. This increase in the company’s 2015 CRT obligation is additive to Mosaic’s guidance for 2015 CRT and Canada Royalties of $215 to $275 million provided as of Feb. 11, 2015.

Mosaic said it is continuing to assess potential ways to mitigate the increase, and expects to update all guidance, including CRT and Canadian Royalties, on April 30, in the first quarter 2015 earnings release.

Potash Corp. of Saskatchewan Inc. complained about the tax changes soon after they were announced (GM March 23, p. 1) and said they would decrease its 2015 pre-tax earnings by C$75-100 million.

Agrium Inc., which is a smaller producer, at the tail-end of a major expansion, expects no significant impact on near term earnings.

Cameron to buy Agrium facility – Alert

Cameron Chemicals Inc. reports that it has entered into a definitive agreement with Agrium Inc. to purchase the Reese Micronutrient Production Facility located in Reese, Mich.  The transaction is anticipated to close in the second quarter of 2015.

The Reese facility will be operated under newly incorporated, Advanced Micronutrient Products Inc. (AMP), and led by Bobby Bowen, John Bowen and Mark Whitfield. Products produced at Reese will continue to be sold under the AMP logo and trademark following the close of the transaction.

Cameron Chemicals Inc., founded in 1987, is headquartered in Virginia Beach, Va., with a production facility in Suffolk, Va.  It manufactures of dry granular micronutrients as single elements or as multi element mixes. Its products are marketed and sold through distribution networks located in North America, Europe, Asia and many other countries.

USDA forecasts record soybean crop for 2015; corn, wheat, cotton, rice all down from 2014 – Alert

USDA is forecasting 89.2 million acres of planted corn in the U.S. in 2015, according to the annual Prospective Plantings report released on March 31. The estimate is down 2 percent from last year, but up slightly from the 89 million-acre forecast the agency gave in last month’s early-season projections.

“Planted acreage for 2015 is expected to be down across most of the Cornbelt, with the exceptions being Minnesota and Wisconsin, which are both expecting an increase in planted acreage from last year,” USDA said. If the 2015 forecast is realized, USDA said this will be the third consecutive year of an acreage decline, and the lowest planted corn acreage in the U.S. since 2010.

Soybean planted area for 2015 is estimated at a record high 84.6 million acres, up 1 percent from last year and also higher than the February early-season forecast of 83.5 million acres. “Compared with last year, planted acreage intentions are up or unchanged in 21 of the 31 major producing states,” USDA said, noting that increases of 200,000 acres or more are anticipated in Arkansas, Iowa, and Ohio. “If realized, the planted area in Kentucky, Minnesota, New York, Ohio, Pennsylvania, South Dakota, and Wisconsin will be the largest on record,” USDA said.

All wheat planted area for 2015 is estimated at 55.4 million acres, down 3 percent from 2014 and down just slightly from the February early-season projection of 55.5 million acres. The 2015 winter wheat planted area, at 40.8 million acres, is down 4 percent from last year but up less than 1 percent from the previous estimate. Area planted to other spring wheat for 2015 is estimated at 13.0 million acres, down slightly from 2014. The intended durum planted area for 2015 is estimated at 1.65 million acres, up 18 percent from 2014.

All cotton planted area for 2015 is estimated at 9.55 million acres, down 13 percent from 2014 and also trailing USDA’s February early-season forecast of 9.7 million acres. “If realized, this will be the lowest planted acreage in the U.S. since 2009,” USDA said. “Growers in all states except Oklahoma are expected to reduce planted acreage from last year. If realized, planted area in Arkansas, Louisiana, and Tennessee would be record lows.”

Area planted to rice in 2015 is expected to total 2.92 million acres, down 1 percent from 2014 but up just slightly from the February early-season estimate of 2.90 million acres. “The expectation of lower prices for 2015 is contributing to the expected decline in rice acres compared with last year,” USDA said.